House Buying and Solicitor Costs

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Home > Blog > House Buying and Solicitor Costs
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11/23/2023

Understanding Solicitor Costs and Other Fees

Purchasing a property can be a very exciting time, particularly after years of saving and hunting for the perfect new home. It can also be a time full of learning and having to quickly react to directions from real estate agents, mortgage brokers and lawyers. Some of the requests may be simple and straightforward (like producing identification documents), but others may catch you by surprise (such as having to transfer funds in a short period of time). Nobody likes surprises when they involve large amounts of money, so it is wise to understand upfront the types of fees, such as solicitor costs, insurance and transfer fees, so you can be well prepared and not caught off guard.

Transfer Duty Fees 

The biggest fee when it comes to buying property is transfer duty (also known as stamp duty). Unless you are an eligible first-home buyer and can access first-home concessions, your stamp duty is likely to be in the tens of thousands of dollars, on top of the cost of the property. This fee is payable up-front, usually as part of the settlement process.

It is easy to work out the amount of stamp duty payable simply by using a transfer duty estimator, like the one on the Queensland Revenue Office’s website.

The Queensland Titles Office also charge a title transfer fee, which is based on the purchase price. Your conveyancer will be able to give you an estimate of this will be.

Mortgage Set Up Fees

Mortgage fees relate to the cost of setting up the mortgage and are usually in the realm of a few hundred dollars, but they can vary depending on the size and complexity of the loan. Typically, this fee will be payable at settlement, but you should read your mortgage documents carefully to establish the fee amount and when it is due. If you are selling another property and using the proceeds of the sale to fund the purchase of your new property, you may be discharging a previous mortgage. This means that you are paying off the old mortgage using the proceeds of the sale and opening a new mortgage related to the new property. This can sometimes attract further fees, and you should speak to your lender about how paying off your existing mortgage early can attract added costs.

Conveyancer costs and Services

Conveyancers typically charge lower fees than solicitors, making them a cost-effective option for straightforward property transactions. Their fees generally range between $800 and $2,000, depending on factors like the complexity of the transaction, the location of the property, and the specific services required. Disbursements, or additional costs, are also part of the total fee and include expenses such as title searches, property registration fees, and bank transfer charges. These disbursements usually range from $300 to $800.

Conveyancer Services
Conveyancers specialise exclusively in property transactions and provide essential services to ensure a smooth transfer of ownership. These services include:

  • Preparing and reviewing the contract of sale and Section 32 (Vendor Statement).
  • Conducting property title searches and checking for any restrictions or caveats on the property.
  • Managing the transfer of ownership and lodging the necessary legal documents with the relevant authorities.
  • Coordinating with financial institutions for mortgage settlements or payments.
  • Ensuring all property taxes and rates are accounted for at settlement.
  • Organising and finalising the settlement process on behalf of their clients.

Conveyancers focus solely on property-related matters and are a practical choice for most standard property purchases or sales.

Solicitor Costs and Services

Solicitor costs are typically higher than conveyancers due to their broader legal expertise. The cost for a solicitor can range from $1,500 to $3,000 or more, depending on the complexity of the transaction and the legal issues involved. Like conveyancers, solicitors also charge for disbursements, which include title searches, registration fees, and bank transfer charges. These additional expenses usually range from $300 to $800, depending on the property.

Solicitor Services
Solicitors offer a wide range of services, encompassing not only property transactions but also other legal areas. When it comes to conveyancing, their services include:

  • Drafting and reviewing contracts of sale, including complex agreements such as off-the-plan purchases or commercial property contracts.
  • Providing advice on legal issues beyond the scope of conveyancing, such as disputes, wills, or tax implications.
  • Handling complicated property transactions, such as unregistered land, properties with caveats, or leasehold properties.
  • Representing clients in disputes or legal proceedings related to the property.
  • Advising on special conditions in contracts or situations involving multiple parties or entities.

Solicitors are ideal for transactions that involve legal complexities or when broader legal advice is needed beyond the property purchase or sale.

Building and Pest Inspections

Engaging building and pest inspectors can seem like an unnecessary cost during a purchase, but they can save you from making a mistake in the amount of hundreds of thousands, or even millions of dollars. Fees for building and pest inspections will vary, but they are essential for anyone wanting to make a sound investment on a property that is free from termites or building defects.

Insurances Costs

Most insurances are optional, but depending on the amount of your deposit and other lending conditions, you may need to pay Lenders Mortgage Insurance (LMI). LMI can be a cost of tens of thousands of dollars but it can be wrapped up into the overall amount of the loan. You should check with your lender whether their LMI is payable up front or if it can be amortised over the life of the loan.