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The 4 main costs involved when buying property

Updated: May 25, 2022

Whether you're buying a house for owner-occupier purposes or investing in real estate, it's important to consider the costs

Buying a house is a big commitment! Though, it's an exciting commitment that we all look forward to at some stage in life.

At Real Estate Investment Finance, we're here to help you with buying your first home. We will assist you from the finance stage, sourcing the right property, through to assisting your needs after you've moved in.

In this article we'll explain the four main costs involved when buying a house. We'll look at the upfront costs, government fees, mortgage repayments and general expenses involved with that home.

Before you purchase your home it's important to know what you can afford. We highly recommend consulting a specialist such as a REIF home loan expert to see what you can afford. Our brokers will work with you to review the costs and affordability of buying a house. They'll help you with determining your borrowing capacity and other finance options available to you!

Upfront costs

Upfront costs are fees that you initially pay when you enter into a property contract. When you purchase a home, you'll be required to pay a deposit. Deposits start from 5% of the overall costs for the house and land. Though, the total deposit is also dependant on the loan type and the amount that you wish to borrow.

If you're paying less than a 20% deposit when you're buying a house, you'll be required to pay a fee to the bank. This is called Lenders Mortgage Insurance (LMI). LMI is an insurance policy that covers the mortgage lender in the instance that you are no longer able to make mortgage repayments, resulting in losses for the bank.

Other up-front costs you can expect to pay during the process of buying a house are; solicitor and conveyancing fees. It's always a good idea to have a few thousand dollars put aside for these fees. While you're technically allowed to arrange your own legalities when purchasing a house, it's highly recommended that you pay a solicitor. They will arrange the relevant documents for you and provide professional legal advice.

The upfront costs, such as stamp duty, are one of the main costs you should be aware of when purchasing an investment property

Government fees

This is especially relevant if you're buying your first home - because you often neglect to consider these fees. Government fees will differ for each state and territory, so we highly recommend consulting your state or territory government website. For instance - stamp duty. This is a land tax that differs from state-to-state and if you're a first home buyer you may be entitled to certain concessions.

Mortgage repayments

When you're looking at finance, there are various lending options available to you! As a borrower, you'll be shown a variety of interest rates suitable to your circumstances. One type of interest rate is a fixed rate. Fixed rates are set over a certain period of time and will not change until the contract has ended. You may also choose a fixed plus variable rate, or a standard variable rate. Variable rates are subject to change as the market changes.

Deciding on the right loan can often be a time consuming and overwhelming process. That's why we recommend consulting a REIF finance specialist. Our finance specialists have access to over 40 lenders. They will help you to source the most suitable rate and ensure you're only paying what's suitable in terms of mortgage repayments.


These are the costs involved during the process of buying a house and beyond. It's important to compare your earnings with your expenses on a regular basis to determine whether you'll be able to afford them.

Some common expenses that you'll need to account for are:

If you own a home, we cannot stress the importance of insurance and asset protection enough! This is a VERY IMPORTANT expense that will give you peace of mind in the instance that your house and contents are compromised. The average cost of this expense is only $2,000 a year.

Find out more

Looking for that right property? Whether you're looking for that next home, investment property or buying your first home - we can help! REIF will help you from the end-to-end process of owning property. We will help you with finding the most suitable mortgage options, finding the best property and beyond!

To learn more, reach out to us on the details listed below. We would love to be able to guide you through our seamless journey.

Ph: 1300 130 932


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