Ongoing Costs to Consider When Buying a Home in Australia

So you’re an Aussie mechanic, grease under your fingernails and dreams of homeownership in your head. You’ve been wrenching away at your budget and understand the importance of interest rates. But hold on a sec, cobber, because there’s more to this house than meets the eye (or the loan contract). Let’s delve into the ongoing costs that come with a home loan, besides the headline interest rate.

First things first, there’s the initial hurdle: application fees. These vary depending on the lender, but they can be a few hundred bucks to get your foot in the door. Once you’re in, some lenders whack on a monthly or annual account keeping fee just for the privilege of having your loan with them.

Now, let’s say you’re a responsible sort who likes to get ahead on repayments. Great! But if you want the flexibility to redraw some of that extra cash down the track, be prepared for a potential redraw fee each time you dip back into your repayments.

But that’s not all! Owning a home is a far cry from renting. Here’s where things get real:

  • Council Rates: Every year, you’ll contribute to the local kitty for services like rubbish collection, parks, and libraries. The amount will depend on your property’s value and location.
  • Home and Contents Insurance: No lender wants to see their investment go up in smoke (literally). That’s why most require you to have home and contents insurance to cover things like fire, theft, and even possum damage (it’s a thing!).
  • Utilities: Unlike renting, where some bills might be included, you’ll be responsible for everything from electricity and gas to water and internet.
  • Maintenance, Glorious Maintenance: From leaky faucets to overgrown gardens, things will break and need fixing. Budget in some cash for regular maintenance and unexpected repairs.

Feeling a bit overwhelmed? Don’t worry, mate. The good news is that with a little planning and budgeting, you can factor these ongoing costs into your homeownership dream. Talk to different lenders, compare fees, and get a realistic idea of what you’ll be paying beyond the interest rate.

Remember, buying a home is a marathon, not a sprint. By being prepared for all the costs involved, you’ll be cruising down the homeownership highway in no time!