Some of The Additional Expenses to Consider Before Buying a House
You have saved up for the deposit, got a pre-approval from the bank and narrowed down your choice of a home to just one, but have you thought of the different little expenses that may come along with buying a property? All of these and other expenses should be budgeted into what you can actually afford. These are just some of the one-time and ongoing home expenses you may want to consider:
Getting a property valuation, Land Information Memorandum report, title search and pre-purchase building inspection are the things you shouldn’t skimp on (unless they are provided to you for free by the agent, of course) if you are interested in making an offer on the property. These are one-off expenses which may help you make an informed decision on whether you should go ahead with the purchase.
Getting a pre-purchase condition inspection is highly important, as it can identify any matters that need attention. Considering how old some New Zealand houses are – and also the widespread leaky building issue, in most cases there will be some maintenance to do, so by getting independent advice you can ensure you know as much as possible about the property. Depending on how big the house is, a pre-purchase condition report can set you back around $500.
Another important step you should take before purchasing a property is getting hold of the certificate of title, which will provide you with information on the size and shape of the land section, who owns it and also whether there are any mortgages, leases, and any interests registered against the title. There could be an additional fee of $15 for this.
Although some real estate agents will provide a LIM report to potential buyers for free, in some cases you may need to pay for it yourself, which can set you back $265 or $365 for an urgent LIM, if you are looking at buying a house in Auckland.
Getting a valuation could also be a very wise thing to do before going ahead with the purchase (often, it will be requested by the bank anyway). It will allow you to check if the price you are prepared to pay, or the offer you are making to the vendor, reflects the market value of the property. Depending on the property type and size, a professional valuation will cost a few hundred of dollars.
Some of the other additional expenses you should consider before buying a house or an apartment are:
- House and content insurance – very, very important! Shop around by getting quotes from a number of reputable insurance companies.
- Rates! If you are in Auckland or any other area where the house values have significantly gone up over the past few years, the chances are your rates will increase very soon.
- Regular utility bills like power, phone, Internet, water, SKY
- House repairs and maintenance, maintenance of common areas or body corporate, if applies
- Paid car park, if applies
- Furniture to move in with, if you don’t already own any
Please note that this blog does not constitute financial or property advice; it is provided for general information purposes only.
Sources: consumerbuild.org.nz