What are the costs of buying a home in Adelaide?

Stamp duty: the biggest cost for most buyers

Stamp duty is a state tax on the purchase price, calculated by RevenueSA on a sliding scale. Under the general rates, duty on a $500,000 home is $21,330, on a $600,000 home it is $26,830, and on a $700,000 home it is $32,330. Above $500,000 the rate is $5.50 for every $100 of value, so each extra $10,000 on the price adds $550 in duty.

First home buyers in SA pay no stamp duty on an eligible new home, an off-the-plan apartment or vacant land to build a home on, with no property value cap for contracts from 6 June 2024. There is no first home buyer stamp duty relief on an established home. If you are buying an existing house or unit as your first home, budget for the full amount at the general rates.

Registration fees and settlement adjustments

When the property is transferred into your name and your mortgage is registered, the SA Government charges a fee to register the transfer, which is scaled to the property value, and a separate fee to register the mortgage. Your conveyancer collects these at settlement along with stamp duty. They are much smaller than duty but still belong in your budget.

Your settlement statement will also include adjustments for council rates, SA Water charges and the emergency services levy. If the seller has paid these ahead, you reimburse them for the period after settlement. If the seller has not paid them, they credit you for their share.

Legal, inspection and loan costs

Conveyancing covers your conveyancer's or solicitor's professional fee plus searches, so ask for a written quote before you sign. A building and pest inspection is worth doing on any established home. For a private sale it can be booked during the cooling-off period or made a condition of your offer. There is no cooling-off at auction in SA, so inspections have to be done before auction day.

Lenders may charge an application or establishment fee, a valuation fee, settlement fees and, on some packaged loans, an annual fee. These vary a lot between lenders, which is one reason to compare the total cost of a loan rather than the headline rate. The comparison rate helps here because it rolls most standard fees into a single percentage.

LMI, insurance and moving in

If your deposit is under 20% of the value, most lenders charge lenders mortgage insurance. Depending on the loan size and LVR it can run from a few thousand dollars to well over ten thousand, and it is usually added to the loan rather than paid in cash. Eligible first home buyers can avoid LMI with a 5% deposit under the Australian Government 5% Deposit Scheme, which has a price cap of $900,000 in Adelaide and $500,000 elsewhere in SA.

Your lender will usually require building insurance to be in place by settlement. Then come the costs of moving itself: removalists, connecting electricity, gas and internet, and any urgent repairs or furniture. These are easy to forget when every spare dollar has gone into the deposit, so set aside a buffer.

Putting your budget together

Take an established $600,000 home bought by someone who is not eligible for any concession. Stamp duty is $26,830. Add registration fees, conveyancing, a building and pest inspection and loan fees, and the total is likely to be a little over $30,000 on top of the deposit. That is around 5% of the price, which is why the 4-6% rule of thumb is a useful starting point.

First home buyers buying or building a new home may also receive the $15,000 First Home Owner Grant, with no value cap for contracts from 6 June 2024. The grant is not available for established homes. Lenders will want to see that you have the funds to complete the purchase before formal approval, so map out every cost before you start making offers.

Frequently asked questions

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