When you are working out the finances of buying a home and ready to apply for a loan, don’t forget to include those other costs you will need to pay. These may be considered hidden costs because you may not realise they exist if you’ve never had anything to do with buying real estate. It can come as a shock to know that you have to account for many thousands of dollars more than the price of the house. What are these hidden costs?

• Stamp duty is one of the most significant costs; even when discounts apply, it still accounts for thousands of dollars. There are two types; responsibility for the transfer of the property and duty for the registration of your mortgage. The amount of the former depends on the property’s price and what state or territory it is in.
• Moving costs and renovation costs if you want to paint or replace the carpet before you move in. You might also want to purchase new white goods.

• Those essential pest and building inspections are much less, but still, a cost to be paid. Damage from termites can cost thousands to repair, as can structural damage, so getting those inspections is undoubtedly worthwhile. Still, they must be paid for. Don’t leave it for the seller to assure you they’ve had an appraisal done. Not everyone is honest.
• A buyer doesn’t have to pay real estate commissions on the transaction, but if you are selling your current home to buy another, the real estate agent will charge you a commission. This is usually a percentage of the sale price, so don’t forget to factor that into your equation when working out the budget.
• Legal costs may not seem much compared with the cost of the house, but they still have to be paid. There is a cost for conveyancing even if you don’t use a lawyer, plus you need a professional to conduct searches to ensure the current owner can legally sell it.
• There are often costs associated with your mortgage. Ask the lender what these will be.
• Lenders’ mortgage insurance can be avoided by saving up to 20% of the price for a deposit. Otherwise, the lender will charge you this extra to cover their risk. You should also consider Mortgage Protection Insurance that will take care of the repayments if you are ill or injured and can’t work anymore. If you have valuable furniture and goods, ensure they are insured during moving.

All these costs add up and must be figured into your budget to get an accurate picture of the costs of purchasing a new home, or any property, for that matter. Once you know what to expect, you’ll can work out the repayments you can cope with.