Hit with hidden fees
First homebuyers are being hit with hidden fees. Image – Canva.
  • The average first homebuyer is being hit with $6K+ of 'unexpected' extra costs
  • Research from Finder suggests these can be for advice, travel and reports
  • The amounts vary according to state and for owner occupiers versus investors

First home buyers have been one of the hottest parts of the booming property market across the country, but amid all the excitement they are forking out an extra $6,353 in unexpected fees.

This is the finding from research site Finder, which interviewed 1,028 first home buyers, with more than half paying unexpected upfront costs.

The research also found that Victorians paid more in these ‘unanticipated costs’ ($9,107 on average) as compared to NSW ($5,886) and Queensland ($4,724)…

Average Unexpected Costs, by State

Unexpected costs
Source: Finder

“Paying for government charges, lender fees and other moving costs can easily stack up to $10,000 or even $20,000, depending on the state,” said Sarah Megginson, home loans expert at Finder,

“That’s a sizable price for homebuyers to pay if they aren’t expecting it.” Ms Megginson said.

Owner-occupiers were more likely to pay unexpected costs than investors, but actually paid less than half ($5,647 compared to $12,573 for investors).

Hidden costs typically included: professional advice, travel costs and property reports.

“It’s important buyers do their research beforehand. While many states offer concessions on stamp duty for first home buyers, there are still costs for conveyancing, loan application fees, and home and contents insurance, to name a few.”

Sarah Megginson, Finder

Lender’s mortgage insurance also applies to those borrowing more than 80% of the property’s value, potentially costing thousands of dollars, she said.

How to avoid these hidden costs

  1. Do your research – beyond the cost of deposits and home loans, there are a number of expenses associated with buying a home such as stamp duty, title transfer fees, lender fees and more.
  2. Don’t forget the hidden fees – there can be plenty of extras to consider as well, such as information costs, professional advice and travel costs.
  3. Compare mortgages to get the best deal – look for low-fee, low-interest home loans.

Source: Finder’s First Home Buyers Report 2021

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