Real Estate Buying Costs in Queensland
Having been in Real Estate for well over a decade, sometimes we take the fundamentals for granted until we are reminded that everyone has a first time. We were chatting with a young lady who asked us a simple yet very good question – are there any other costs in buying a home beside the purchase price when buying real estate in Queensland.
To help answer this let’s assume two things. The property is located in Queensland and the home sells for $530,000. That’s the first cost, so what else?
Building and Pest
We would always recommend a building & pest inspection be performed. This is a chance for you to employ a qualified building & pest inspector (sometimes there is one of each), to have a thorough look over the home and inform you of any issues discovered or may arise in the future. We would also always recommend you be present for this as it is a great opportunity to ask questions and hear firsthand exactly what they find and in what context (which is equally important).
We won’t go into the ins and outs of the building and pest here, how it applies to a contract, legal ramifications and so forth as we are looking at costs at this stage – maybe for another post.
You can expect to pay between $450 and $650 for a building & pest inspection (depending on the level of service they provide). Let’s take the median as the cost being $550.
Next is Conveyancing. This is where you employ a qualified conveyancer or legal practitioner (solicitor) to not only ensure the contract travels smoothly and abide by the terms and conditions, but importantly conduct searches on the property to ensure there are no hidden surprises and you know exactly what you are buying into.
You can expect to pay between $1400 and $1800 for a conveyancer, again depending on the level of service provided and searches conducted as they have costs too. Again, let’s take the median as the cost being $1600.
Next up the Queensland Government Transfer Duty (commonly known as Stamp Duty). Depending on whether you are buying as an owner occupier or an investor, the transfer duty varies. The Government charges the ‘normal’ full transfer duty (which is what an investor buyer would pay) but if you are an owner occupier, you get a discount – a lower transfer duty. On a $530,000 home, the ‘normal’ duty is $16,975 but if you are an owner occupier, the duty is discounted to $9,800 – a fair difference.
Please note, at present, there is a further ‘discount’ for first home buyers who will also be owner-occupiers. There is no Transfer Duty if the purchase price is under $500,000, and a sliding scale of discount between $500,000 and $550,000. Over $550,000 this first homeowners discount evaporates, and you are back to the normal owner occupier discount. If you were a first homeowner and the home was $530,000 – your discount would drop the duty to $6,300. (To get all the details visit the Queensland Government website or Google ‘Queensland transfer duty homes’. There are other variables such as land only, but again check the website).
Summary of Real Estate Buying Costs
So now, let’s add up the costs:
$530,000 – purchase price
$550 – building & pest
$1600 – conveyancing
$6,300 – Transfer Duty (assuming first home buyer)
Giving a total of $538,450 on an initial purchase of $530,000 home.
There of course can be other costs such as removalists, finance costs etc but these are very individual.
When buying real estate in Queensland, you need to consider the full costs when deciding on your budget. We hope this has helped explain what costs relate to purchasing a home and some of the variable such as Transfer Duty.
Finally, please note this information is relevant at the time of writing. If you would like more information, feel free to contact us anytime.
Written by Shawn Kristofer