WHEN bidding at auction or going in to negotiate, most buyers keep a number set in mind — their limit. But when it comes to finally putting your money down, that number is far from final. Advantage Property Consulting director Frank Valentic explains that for many Melbourne properties, extra costs could add up to $100,000 to a sale price. He breaks down the biggest extras, and how to budget for them.
THINK BIG: It can be easy to underestimate the costs of buying and moving “It’s not just the cost of the property, and many of these costs cannot be factored into your loan,” Mr Valentic warned. Factoring in 11 per cent of the property’s purchase price could indicate how much extra cash would be needed to cover incidental costs. It is essential to keep this in mind when discussing a budget limit. “The main question to ask your broker or bank is if that is the purchase figure, or is that inclusive of all the costs you’ve got to factor in,” he said. “Because if it isn’t, you will have to work back about 11 per cent.” For a $1 million property, an average price in much of Melbourne, added costs could hit $110,000.
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