Who Pays for What When You Buy or Sell a House?

If you’re thinking about buying or selling a property for the first time, you may be wondering what costs are involved and who pays for what.

If you are buying a property, the purchase price is obviously the biggest cost. You may have a deposit saved and be financing the rest, or perhaps you are purchasing the house outright. 

Whatever your circumstances, there are quite a few additional costs you will need to budget for when buying a property.

Stamp duty is payable on most property transactions in Australia.

The state government charges buyers a transfer fee and mortgage registration fee.

Legal and conveyancing fees will be payable. We recommend you engage a Certified Practicing Conveyancer to review your contract, perform checks on the title, and draft the settlement documents. 

Your lender will charge various fees to set up your finance. These are likely to include a mortgage application fee and loan service fee but check with your lender to find out exactly what fees you will be charged and whether they are negotiable. 

If you have a deposit of less than 20% of the purchase price, you will usually be required to pay Lenders’ Mortgage Insurance. 

Although optional, a building inspection and pest report is highly recommended.

Home, building, and contents insurance is strongly recommended. If you are taking out a mortgage for the property, your lender will insist that you have building insurance at a minimum. Note, when purchasing, you are responsible for the property from the day you sign the contract, not the settlement date. 

You may need to budget for moving costs, depending on how many possessions you have and how far you are moving. 

Reconnection fees for gas, electricity and telecommunications may be payable if the vendor has disconnected any of these services.

If you are a vendor selling a home, you will also need to budget for a range of costs.

You may need to carry out some minor repairs and maintenance to get your property looking its best, while property styling can help make your home more appealing to prospective buyers. You may even wish to get your own building inspection or pest report done to avoid any nasty surprises.

There will almost certainly be marketing costs involved. These will vary depending on the options you choose but will generally include photography, brochures, a sign board, and online listings.

Your real estate agent will charge commission, usually a percentage of the property sale price. If you choose to sell at auction, you will also need to pay an auctioneer. 

Legal and conveyancing fees will be payable.

If you have finance on the property, there may be mortgage discharge fees, settlement fees and government fees payable to your lender when you sell the home. If your mortgage is fixed, there may also be early repayment costs.

It’s easy to underestimate what is involved in buying or selling a home, which is why engaging a Certified Practising Conveyancer can help you navigate the complexities of this process.

We have also compiled some handy links to help you calculate the costs of buying or selling a property.

Please get in touch today for a confidential and obligation-free chat, so we can answer any questions you may have and provide you with a cost estimate for your conveyancing needs.