As a First Home Buyer (FHB -you!) be aware that there are additional costs to your purchase price.
Often cost terms are thrown around, and like most FHB, you most likely smile and nod when this happens. As you disappear into the safe refuge of your car, you hit google search and thankfully find this BLOG which conveniently explains those, cost terms and empowers you to be in control of your first home purchase and get you through the front door
The first major cost above the purchase price is Stamp Duty (now called Transfer Duty in NSW). Transfer Duty is a tax imposed by the NSW Government upon the Purchaser when they purchase a property, and Revenue NSW governs stamp duty obligations in NSW.
BUT if you are an FHB, you may be entitled to a concessional rate of transfer duty or even an exemption from it all together under the First Home Buyers Assistance scheme (FHBAS). This link gives you a guide as to whether you are eligible for a concession or total exemption and discuss with your bank and Mortgage Broker https://www.revenue.nsw.gov.au/grants-schemes/first-home-buyer/assistance-scheme
Understanding your Finances is critical before you even start looking. See my BLOG
Also, note FHBAS can take a more extended approval process, so talk with both your Mortgage Broker and Solicitor (ME!)
Once successful in your property purchase, your solicitor (ME) creates a workspace for your Conveyance in Property Exchange Australia Ltd (PEXA). All parties (Purchaser, Vendor, and Banks) use this digital platform to complete your Conveyance, and your solicitor is a subscriber to this network on your behalf.
All conveyancers have mandatory PEXA fees, and these fees will vary based on the type of transaction being completed. For a schedule of PEXA fees, you can go to https://www.pexa.com.au/pricing. Otherwise, for an FHB, the most common fees are the PEXA Fee Transfer of Title $117.92 and the Lodgement Fees $443.10 (prices current as of March 2022).
These are always subject to change, and your solicitor will advise you of any changes.
This term usually hits your radar when you are sent a Settlement Sheet. Very simply, a Settlement Sheet is a reconciliation of what must be paid by you on the date of Settlement.
Adjustments are the portion of the outgoings (Council, water, and Strata Levies) you are responsible for paying for from the date you take possession of the property, usually the day of Settlement.
To give an example:
Say Settlement was 1 November. The seller may have already paid Council rates until 31 December 2021. An adjustment would be made so that the buyer would pay the calculated proportion to compensate the seller for the rates paid from 1 November until the end of the year (when the buyer will be the owner).
Adjustments vary according to rates and the date of Settlement. Exact amounts are informed by searches undertaken by your solicitor and charged as a disbursement.
It would be best to consider an allowance of between $1,500 and $2,500 to accommodate adjustments.
Disbursements are the costs undertaken by the solicitor to conduct the searches. The usual searches for a First Home Buyers include Sydney Water 66 CT, s184 CT, Council rates, s603 CT Transport for NSW. Searches are required to confirm financial details about the property and inform the Adjustment calculations.
It would help if you considered an allowance of between $200 -$300 to accommodate for these Disbursements
Note that property enquiries such as Building Pest and Strata Reports are outside the scope of these Disbursements.
These will vary, but at BEH Legal, you engage a Solicitor at a fixed price that includes 5 contract reviews. A qualified lawyer is always on call to advise on your contract (including Saturdays and after hours when you need them most). See our competitive rates published on our Pricing page
At BEH Legal, we aim to take as much uncertainty out of your first home purchase. BEH Legal provides a bespoke Conveyancing experience that coordinates and recommends industry professionals to ensure your first home purchase is a great experience.
Contact me and help me navigate your Conveyance and get you those keys to your first home and get you through the front door.
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