Buying a Property
Owning your own home remains one of the great Australian dreams. Whether you are a first time home buyer or a veteran of several homes, the thrill of finding the perfect home and making that successful bid or offer never wanes.
While owning a home means different things to different people, there are some common reasons for investing in a mortgage:
- Building up equity in a home by making regular mortgage payments is one of the best ways for many people to save a large amount of money over time;
- Unlike rent, the money you spend each month to pay the mortgage goes directly towards purchasing your own valuable asset;
- Home ownership is usually a safe way of investing money over a long period, and, depending on location and other factors, the value of the asset is likely to appreciate over time;
- When you own your own home, you no longer face problems associated with renting — no visits from the landlord, no need to renew a lease every 12 months or so, no need to ask permission when you want to make improvements; and
- Many people anticipate that owning their own home will make things easier when they retire.
Buying a property is not only one of the largest purchases you’re likely to make, it can also be one of the best long-term investments — so it’s important you get it right. This means doing your homework and making sure that the property you are buying is the right one in terms of price, location, value, size and lifestyle.
To assist you in making your decision to purchase, the REIA has developed a fact sheet which highlights everything you will need to consider before making a purchase. To obtain a copy of the fact sheet Buying a Property, click here.
Costs associated with buying a property
Costs associated with buying and selling a residential property will involve some, if not all of the following items, depending on the state or territory where the property is bought, and how the property is bought:
- stamp duty: the state tax imposed on documents or “instruments” that record contracts of sale and some loan applications. In each state and territory, stamp duty is payable on the property purchased and in most cases must be paid prior to settlement. Stamp duty is payable on the amounts borrowed for mortgages in all states (excluding ACT and NT).
- conveyancing/solicitor’s fees: comprise the legal fees for the time involved in the conveyancing and the disbursements, ie the cost of searches, enquiries etc in respect to the property
- land transfer registration fee
- mortgage registration fee
- mortgage discharge fee
- other fees, eg loan application/establishment, building inspection, pest inspection, removalists.
For further information on costs involved in buying a property contact your state or territory Real Estate Institute. For contact details, click here.