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 Why a Conveyancer? |
| About Conveyancing |
| Buying Property |
| Selling Property |
| Cost of Buying a Home |
| First Home Buyers |
| FAQ |
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The Cost Of Buying A Home There are no set fees for conveyancing, fees are negotiable and you should obtain an estimate of the fees and disbursements involved, in writing, from your conveyancer. The following are estimates of the costs involved in a typical conveyancing transaction when buying a home. Some things will not apply to your particular purchase and it is not possible to give an accurate estimate of costs without having the details of any particular transaction. This summary is for your assistance and to be used as a guide only. Loan Fees Application fee charged by lending bodies to process a loan application; approx. $nil to $1,000.00 Valuation fee is normally required by the lender to obtain a value from a registered valuer as to the market value of the property; approx. $nil to $500.00 Mortgage Insurance is required by the lender to insure the loan when the amount of the loan compared to valuation is above a certain percentage. This insurance protects the lender against any loss through default of the borrower if the property, when sold, returns less than the loan amount outstanding at the date of sale. The premium paid is a once only premium and is determined by the amount borrowed and the loan to valuation ratio. Conveyancing Fees and Disbursements The conveyancing fee may vary slightly from conveyancer to conveyancer and may be determined by the value of the property. Some conveyancers will charge a flat fee and others will charge a sliding fee determined by the properties sale price: approx: $900.00 to $2,200.00 Disbursements are the charges for those expenses incurred by the conveyancer for the cost of such things as: - Title Search $20 - $100 Inspection Fees Building Inspections will confirm the structural soundness of the property revealing any visible defects and repairs required; approx. $275.00 to $500.00 Pest Inspections will reveal any indications of pest infestation either present or past that may be of concern; approx. $150.00 to $300.00 Strata Inspections are normally done on the owner's corporation's books and records to see if there are any ongoing maintenance or structural problems with the buildings and provide information about strata levies, special levies, insurances etc. approx. $200.00 to $350.00 Survey report may be required to confirm the location of the buildings on the property and their distances from boundaries, to confirm fences are on boundaries, to confirm there are no encroachments onto the property by the next door buildings or by any buildings on the property onto the next door property and to show the position of any easements or rights of way etc. A lender may require this report and as a purchaser you would be wise to obtain this report; approx. $400.00 to $600.00 Stamp Duty Contract Stamp Duty is payable on the contract for sale of land and is determined by the purchase price of the property. The duty must be paid within three months from the date of the contract or before settlement when borrowing money whichever date comes first. If purchasing an "off the plan" property or a "house and land" package then duty is payable within 12 months from the date of contract or before settlement if borrowing money whichever date comes first. Duty on the contract is calculated on a scale as follows; (a) Sale price up to $14,000 (e) Sale price between $300,001 - $1,000,000 (f) Sale price between $1,000,001 and up ** duty is paid at 7% on that part of the purchase price exceeding $3M on a residential property Mortgage Stamp Duty; There may be other criteria to qualify for non payment of duty on mortgages, you should check this with your conveyancer. Other Costs Building Insurance is recommended to be taken out before settlement and if you are borrowing money then your lender will require a building insurance policy noting their name as mortgagee before they will lend any money. Your insurable risk commences as soon as settlement is effected therefore it is essential that the policy of insurance be in place before or on the day of settlement. If you have borrowed money this means that you will have had to arrange the policy well in advance of settlement so that a policy is in the hands of your lender so that their insurance requirements are satisfied before they advance any money at settlement, your lender usually requires the insurance at least two weeks before the settlement. The cost of the insurance will depend on the size, age, location, value and type of material the building is constructed of. It is recommended that you arrange a "Replacement Cover" policy, this covers reinstatement of the property to its original condition, or if you like, replaces new for old. "Indemnity Cover" pays for the repair or reinstatement of your property taking into account depreciation. Speak to your insurance agent so that you have a proper knowledge of what insurance you need, keeping in mind that your lender may dictate to you which policy they require you to take out. Cost of insurance should be checked with your nominated insurance company. Council rates, water rates and strata levies are adjusted at settlement so that each party to the transaction pays their portion of the rates or levies for the period applicable to the settlement. Council rates are calculated on the financial year and are adjusted as if the rates are paid in full for the current year. Water rates are paid quarterly and are also adjusted as if they are paid in full for the current quarter. Unit levies are normally calculated on a quarterly basis but the quarter may not be the normal yearly quarters, they are adjusted as if they are paid in full for the current quarter. The amount payable will be the portion calculated from the settlement date until the end of the current rating period and will be added to the purchase price as the purchaser's portion of those rates or levies. The amount a purchaser will have to allow for their portion of rates will be determined by the settlement date, if settlement is at the beginning of the rating period it may be nearly all of the rates that needs to be allowed, if it is at the end of the rating period it will only be a nominal amount. Ask your conveyancer for an estimate when calculating your budget. Electricity will need to be reconnected into your name if you are taking occupation of the property, if the property is to be tenanted then the tenant will need to do this; approx. $nil -$100.00 during working hours or up to $200.00 outside normal working hours. Telephone will need to be reconnected into your name if you are taking occupation of the property, if the property is to be tenanted then the tenant will need to do this; approx. $80.00 if the phone is already connected, up to $220.00 if phone is not already connected. Gas will need to be reconnected into your name if you are taking occupation of the property, if the property is to be tenanted then the tenant will need to do this; Approx. $100.00 Removalist costs will vary depending on where you are moving to, how far you are moving and the quantity of furniture to be moved and whether you or the removalist does the packing. There may be other expenses involved depending on each individual case and you should check all the costs of your transaction with your conveyancer and then calculate a budget for your personal needs and requirements. Disclaimer: While every reasonable effort has been taken to ensure the accuracy of the information contained in this web site the Australian Institute of Conveyancers NSW Division takes no responsibility for anyone relying on the information. The Australian Institute of Conveyancers NSW Division disclaims all responsibility for any loss or damage suffered by readers or third parties in connection with the information contained in this web site.
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