Buying Property in Melbourne? Don't Forget to Factor these Key Costs — Property Advocates | Melbourne

As Melbourne based buyers advocates, we often encounter first-time buyers who are caught off guard by the hidden costs associated with purchasing property. While the excitement of finding your dream home is palpable, it's crucial to understand that the journey involves more than just the purchase price.

Stamp Duty

Stamp duty is a significant upfront cost that many first-time buyers overlook. In Victoria, stamp duty can be calculated at approximately 5.5% of the property value for investors. For a $650,000 property, this amounts to around $34,070. First home buyers may receive concessions pending purchase price, but it's essential to factor this into your budget

Conveyancing and Legal Fees

Engaging a conveyancer or solicitor is critical to ensure all legal aspects of the property transaction are handled correctly. Their fees typically range from $1,000 to $2,500, depending on the complexity of the transaction. This is not a step to be missed or an area to cut corners. A good conveyancer will safeguard your interests and provide peace of mind throughout the buying process.

Building and Pest Inspections

Before finalizing any purchase, a building and pest inspection is something we advise all clients to undertake, on almost all property types. These inspections can cost between $600 and $900 pending size of property but can save you from a nightmare of unforeseen costs down the track. Identifying potential issues early allows you to make informed decisions on what you’re prepared to pay for the property and help you put a maintenance plan in place for the first few years of ownership.

Moving and Setup Costs

The excitement of moving often comes with overlooked expenses. Budgeting for professional movers, utility connections and cancellations, and potential crossover of your previous property is essential. These costs can add up quickly, particularly if you’re holding two properties for a period of time. So it's wise to plan ahead to avoid financial strain during the transition.

Ongoing Maintenance and Upkeep

Owning a property entails ongoing maintenance, it is part and parcel and one of the known joys of property ownership! Setting up an emergency fund for both regular and unforeseen maintenance issues will protect your mental health. Gutters, gardens, plumbing, stumps, paint work, fencing… Maintaining a property is an absolute necessity if you’re looking to retain and or improve the capital value over time.

Leverage Government Assistance

Victoria offers various grants and concessions for first-time homebuyers, including the First Home Owner Grant (FHOG) and stamp duty exemptions. These incentives can significantly reduce your upfront costs, making homeownership more accessible. Speak to your mortgage broker or financial advisor to determine your eligibility and maximize these benefits where you can because they might not be around forever!