Revealed: Why first-time home buyers are being blindsided by more than $6,300 in hidden costs as they try to get a foothold on the property ladder
- A new study has found first-home buyers are being saddled with hidden costs
- More than half of first-time buyers are paying an average $6300 in extra fees
- A report by Finder.com.au has revealed purchasers are being repeatedly outbid
- This means they must pay for multiple property reports and contract reviews
First-home buyers are being blindsided by more than $6000 in hidden costs as they try to get a foothold on the property ladder, a new study has found.
Stamp duty and lenders mortgage insurance – for those with smaller deposits – are usually incorporated into most first-time purchasers’ budgets.
But more than half of Australians seeking their first home are being saddled with an average of $6300 in additional fees for unexpected services, such as solicitor charges for reviewing contracts and building inspections.
A report from online comparison site Finder.com.au has revealed the booming property market has led to house hunters being repeatedly outbid for homes, driving up the number of times professional advice or building reports are required.
First-time home buyers are being hit with an average of $6300 in hidden fees while trying to secure their first property (stock)
This means prospective buyers are being forced to pay for preparation expenses to bid on multiple properties before they even secure their dream home.
Finder home loans expert Sarah Megginson said some purchasers were being slapped with up to $20,000 in unexpected fees.
‘Paying for government charges, lender fees and other moving costs can easily stack up,’ Ms Megginson said, realestate.com.au reports.
Ms Meggison said many first-home buyers also do not anticipate the travel costs as they go between numerous inspections.
Kim Nguyen and her partner Arnie Brabbs have looked at 90 homes since September last year but are yet to secure their first home.
The couple are growing frustrated with the mounting fees.
A report from Finder.com.au has revealed first-time purchasers are frequently being outbid, driving up the number of times they need to seek professional advice and property reports (stock)
‘There were five homes that we’ve been very interested in so we did building and pest checks on them. Some of the homes or duplexes were brand new too, so those contracts are a bit more expensive to review,’ Ms Nguyen said.
‘Then there are those homes that you’re quite interested in and you decide to get a contract review done and they can vary between $100 to $150.’
Buyers agent Veronica Morgan said the biggest hidden cost for first-time buyers were often payments for properties they do not purchase.
She said the property market is often hard to gauge for those trying to enter it for the first time, and they can often believe they have a chance based on the selling agent’s word.
While it can be tempting to take the leap and lay down a bid just to secure a spot in the market, Ms Morgan advises against being hasty.
She said this could leave purchasers stuck with a property they regret buying if the market slows down.
Kim Nguyen and her partner Arnie Brabbs said they have paid for five building inspections but are yet to buy a home (stock)