So, you've found that perfect house. Great! House hunting can be exciting, especially when you spot “the one”.

It's a little less exciting when you sit down to figure out how much you need to spend. There's the price of the house itself, which will probably be your biggest expense, but you'll have to factor in a range of other things when working out your total budget.

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Stamp duty

Stamp duty—a tax levied on property purchases by states—is one of the bigger costs for which you'll have to budget. The exact amount will vary depending on which state you're in, but it's calculated as a percentage of the property price. 

If you're wondering how much you may be up for, we've got a stamp duty calculator that can help you estimate your stamp duty obligations. 

If you're a first home buyer, you may be eligible for a First Home Buyer Grant or stamp duty concession. Check out our article on what grants and concessions might be available in your state or territory. 

Lenders Mortgage Insurance

If your deposit is less than 20% of the purchase price, you'll need to take out Lenders Mortgage Insurance (LMI), which protects lenders in the event of borrowers defaulting on their loans. LMI can be several thousand dollars, depending on the size of the loan, so if you can pay a 20% deposit it's certainly worth considering. If you can't, you might consider saving for a little longer to reach that 20% threshold, but the LMI saving should be weighed up against the extra living expenses incurred in that time (like rent) and the possibility of property prices shooting up.

Other borrowing costs

Besides stamp duty and LMI, other costs associated with taking out a home loan can include:

• a loan establishment fee;
• a guaranteed rate fee, which fixes a rate for 90 days following your application;
• an additional valuation fee, if more than one property valuation is required;
• a guarantor fee, if a guarantor is included on the loan; and
• ongoing account-keeping fees.

Don't panic! Not all the above may apply to you. For more detailed information about fees associated with a Suncorp Bank Home Loan, check out our Lending Fees and Charges document.

Other expenses

There are a few other expenses that you may need to budget for. These can include things like:

• solicitors or soliciting conveyancers;
• connection or relocation of utilities;
• council fees, such as rates;
• body corporate fees;
• pest and building inspections; and
• moving services.

Again, don't stress too much. Not every fee on this list will necessarily apply to you.

The costs can start to add up, but if you've taken the time to plan for them you can make sure that you only spend what and when you really need to. If you're especially savvy, you might even save a few bucks for an awesome housewarming party.

To estimate the total costs involved in buying a home, try to come up with individual estimates for lending costs (loan establishment fee, etc.) and other costs (utilities, moving services, etc.), then tally them up. These can vary a lot, but even a ballpark figure will help as a starting point.

A Suncorp Bank home loan expert can help you estimate costs and make the home loan process a lot smoother.  Book an appointment with a lender near you. They know their stuff and there's no cost or obligation for their services. They can answer your questions, no matter how large or small, and offer assistance every step of the way.

Published 17 October 2022