Hidden Costs of Buying a Home in Victoria & How to Budget Smartly
Buying a home in Victoria involves more than just the purchase price. Many buyers, especially first-home buyers, are surprised by the additional costs that arise throughout the process. Failing to budget for these hidden expenses can lead to financial stress. In this article, we’ll break down these hidden costs and provide smart budgeting tips to help you plan effectively.
1. Stamp Duty – The Biggest Extra Cost
What is it?Stamp duty is a tax imposed by the Victorian government on property purchases. It is one of the largest additional costs buyers face. The amount varies depending on the purchase price, property type, and whether you’re a first-home buyer.
How much is it?
• Properties under $600,000: First-home buyers may be exempt from stamp duty.
• Properties between $600,000 – $750,000: Discounted stamp duty applies.
• Properties above $750,000: Full stamp duty applies.
• For non-first-home buyers, stamp duty can cost tens of thousands of dollars.
👉 Example: On a $700,000 home, stamp duty for a non-first-home buyer is approximately $37,000.
✔ Budgeting Tip: Use the Victorian State Revenue Office (SRO) stamp duty calculator to estimate your costs in advance.
2. Conveyancing & Legal Fees
What is it?A conveyancer or property lawyer ensures the legal transfer of property ownership and reviews the contract of sale.
How much does it cost?
• Conveyancer fees: $800 – $2,000
• Additional legal fees: May apply if the contract requires changes or complex legal work.
✔ Budgeting Tip: Get quotes from multiple conveyancers and ensure their fee includes title searches and disbursements.
3. Building & Pest Inspections
What are they?Before purchasing a home, it’s crucial to check for structural issues, termites, and other defects. These inspections help you avoid costly repairs after settlement.
How much do they cost?
• Building inspection: $400 – $800 • Pest inspection: $300 – $600
✔ Budgeting Tip: Some inspectors offer combined reports at a lower price. Investing in inspections can save you thousands in future repairs.
4. Home Loan Costs & Mortgage Fees
What fees are involved?• Loan application fee: $500 – $1,000 (varies by lender)
• Lenders Mortgage Insurance (LMI): If your deposit is less than 20%, LMI can add thousands to your loan.
• Mortgage registration fee: Approximately $119 (as of 2025).
• Property valuation fee: $200 – $600 (some banks cover this cost).
✔ Budgeting Tip: Ask lenders if they waive application fees or offer cashback incentives.
5. Council Rates & Utility Connection Fees
What are they?• Council rates: Ongoing local government fees for services (garbage collection, roads, etc.).
• Water & sewerage connection fees: Typically $200 – $500.
• Electricity & gas setup: $50 – $150 per service, depending on the provider.
✔ Budgeting Tip: Some sellers prepay rates, and you may need to reimburse them at settlement.
6. Moving Costs & Immediate Repairs
What expenses should you expect?• Professional movers: $500 – $3,000 (depends on distance and volume).
• Temporary accommodation/storage: If settlement is delayed, you may need short-term housing.
• Repairs & maintenance: Even a well-maintained home may need minor fixes like painting, plumbing, or new locks.
✔ Budgeting Tip: Ask lenders if they waive application fees or offer cashback incentives.
7. Home & Contents Insurance
What is it?Home insurance covers damage to the property, while contents insurance protects your belongings. Most lenders require proof of insurance before settlement.
How much does it cost?
• Home insurance: $800 – $3,000 per year, depending on location and property value.
• Contents insurance: $300 – $1,500 per year.
✔ Budgeting Tip: Bundle policies with one provider for potential discounts.
8. Owners Corporation (Body Corporate) Fees (For Apartments & Townhouses)
What is it?If you buy an apartment or a townhouse in a managed complex, you’ll need to pay owners corporation fees for shared property maintenance.
How much does it cost?
• Low-rise buildings: $1,000 – $3,000 per year
• High-rise buildings with amenities (pool, gym, concierge): $5,000+ per year
✔ Budgeting Tip: Ask for a copy of the owners corporation certificate to check for upcoming special levies.
Smart Budgeting Strategies for Buyers
✅ Get Pre-Approval: Understand exactly how much you can borrow and prepare for all costs.
✅ Use a Home Buying Budget Template: Track every expense to avoid surprises.
✅ Negotiate Fees: Ask lenders about waiving fees or reducing interest rates.
✅ Have an Emergency Fund: Keep extra savings for unexpected costs, ideally at least $5,000 – $10,000.
✅ Check Government Grants: If eligible, use First Home Owner Grant (FHOG) and stamp duty concessions to reduce costs.
Final Thoughts
Buying a home in Victoria comes with many hidden costs, but with smart budgeting and planning, you can manage these expenses effectively. Make sure to research all potential costs, compare service providers, and set aside extra funds for unexpected surprises.
If you need expert guidance in your home-buying journey, feel free to reach out—I’d love to help you find the perfect property within your budget!