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The True Cost of Buying and Owning Property in 2017

The True Cost of Buying and Owning Property in 2017

Looking into buying your first home? Maybe you’re considering venturing into investment properties? Congratulations! But, before you make any concrete decisions, do your research.

Here is the TRUE cost of buying or owning a property.

You’ve probably figured out that buying a property isn’t cheap. Sadly, it is not just the property’s dollar figure you need to worry about.

A property will continue to incur costs for as long as you own it, for example, finding new tenants, repairing ‘wear and tear,’ and upgrading the kitchen are all common.

To create a strong financial plan before making the jump, don’t be tempted to only factor in what you ‘hope.’ You need to be realistic, and if anything, always over-compensate costs.

You’ve probably already researched the up-front costs…

  • Purchase Price – Enough said here.
  • Stamp Duty – If you’re purchasing your first home, you might not need to pay stamp duty.
  • Mortgage and Land Transfer Fees – Often the forgotten fee, mortgage or land transfer fees are difficult to avoid.
  • Up-Front Deposit, usually 20% to receive a lower interest rate and avoid paying lender’s insurance.
  • Conveyance Fees – You’ll need a conveyancer or solicitor to document the settlement process. Annoying, yes. But a good one is worth their weight in gold.
  • Establishment Fee – Always aim to have this waived or not included. The banks want your business, and the mortgage market is too competitive to not give it to you.
  • Moving Costs – Often, you will need to pay your new mortgage costs as well as your old rent costs for a short time. Do your best to avoid this by renting van/caravan or cashing in some favours.

But do you know the ongoing costs?

  • Mortgage – Obvious, but also the most significant.
  • Owners’ Corporation Fees – Those buying into an apartment building need to pay this, usually quarterly. Keep in mind ‘extras’ like lifts and swimming pools can add thousands to this bill.
  • Home Insurance – Also on the obvious side. Make sure you also cover home and contents, because you never know what could happen. If you’re renting you should also seriously consider landlord insurance and hiring a professional property manager.

Feeling overwhelmed? Don’t worry too much, as the majority of these costs are spread out over a long period of time.

If you would like to make sure you have all bases covered, speak to an expert.

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