The Real (and Hidden) Costs of Buying a House in South Australia

The purchase price is only part of the story. Between signing the contract and getting the keys - and for years after - there are loads of additional costs that can add tens of thousands to what you thought you’d be paying.

Buying a new house is exciting. You've found the perfect place. The price is right, the location ticks all your boxes and you're ready to put in an offer.

But whether you’re buying your first home or considering an investment property, when it comes to the expenses involved, the initial price tag is only part of the story.

Understanding this can make all the difference between enjoying a smooth purchase or enduring a stressful one.

Why? Because the real cost of buying a house goes well beyond the deposit and mortgage repayments... and this can come as a bit of a surprise to buyers who haven’t been through the process before.

So before you start browsing real estate listings, it pays to take the time to understand exactly what expenses you're in for – and how to budget for them.

What you'll pay upfront when buying property

When you're preparing to buy a property in South Australia, there are several one-off expenses you'll need to cover before you set foot in your new home.

Here are the main ones.

• Stamp Duty
  This is usually your biggest upfront expense after the deposit.

  In South Australia, stamp duty – also known as transfer duty – is a state government tax that is applied when you buy residential property.

  The amount varies based on either your property's purchase price or market value… and it climbs quickly.

  For instance, a $400,000 property in Adelaide attracts around $16,330 in duty, while a $600,000 home sits closer to $26,830!

  But there's good news if you're a first home buyer purchasing a new or off-the-plan home - there’s significant relief available.

  As of mid-2024, the SA Government abolished stamp duty entirely for eligible first home buyers on new and off-the-plan homes, with no property value cap.

  This exemption alone can save you tens of thousands of dollars! And it’s the reason many first-timers are drawn to newly constructed homes rather than established ones.

  If you’re not eligible, it pays to factor stamp duty into your budget early, so you know what to set aside.

   

  RevenueSA has a handy stamp duty calculator to help your get an accurate estimate for your specific situation.
  
  

• Lender's Mortgage Insurance

  If you’ve found a property you’d like to buy, but your deposit is under 20%, your lender will likely ask you to pay Lender's Mortgage Insurance.

  Despite what the name suggests, this is there to protect them, not you, in case of loan default.

  LMI can range from a few thousand to well over $20,000, and is typically calculated on between 1% - 5% of the total loan amount.

   

  As an example, on a $500,000 loan with a 10% deposit, you're looking at upwards of $10,000, depending on your lender and their individual rules.

  But while potentially costly over the long term, it’s not as immediately scary as it sounds. You can often roll it into your loan rather than paying it upfront (though you'll pay interest on it).

  If you’re a first homebuyer, you can also potentially avoid LMI altogether through the federal government’s First Home Guarantee scheme.

  Or you’re lucky enough to be a doctor, lawyer or accountant? Some lenders will also waive LMI for professionals working in medical, legal or financial professions.
  
  

• Conveyancing Fees

  A conveyancer or solicitor handles the legal side of transferring property ownership - running searches, reviewing contracts and making sure everything’s legally sound before settlement.

  Fees in SA typically sit between $800 and $2,000. It might feel like another bill, but having someone experienced in your corner can save you from expensive mistakes down the track.

   

• Building and Pest Inspections

  Before committing to an older established property, professional inspections are one of the smartest investments you can make.

  These reports uncover hidden structural problems, termite damage or safety issues that aren't visible during a quick walk-through.

  While you can expect to pay between $400 and $800 per inspection, it might actually save you money if issues come up – you may be able to negotiate repairs, offer a lower price – or walk away from the deal entirely.

  With newly built homes, inspections are generally simpler since everything is constructed to current standards and covered by builder warranties.

   

• Loan Application and Mortgage Registration Fees

  Inevitably, your lender will charge a range of application fees, settlement fees and various admin costs.

  You’ll also pay around $192 to register the mortgage with the Lands Titles Office in SA.

  On top of that, transferring the title comes with yet more lodgement and transaction fees based on the property’s value.

  Your conveyancer usually rolls these into their quote, but it’s worth confirming so there are no surprises.

  Some of these fees are negotiable, so it’s worth asking your broker to push back where possible.

   

• Home and Contents Insurance

  Most lenders require building insurance before you settle. This covers structural damage from fire, storms and other events, while contents insurance protects what's inside.

  Premiums vary depending on location and property type. In areas prone to flooding or bushfires, annual costs can hit $2,000 to $3,000 or more. Shop around and make sure you understand what's actually covered.

   

• Moving Costs

  Removalists, utility connections, cleaning supplies, takeaway among the chaos of moving week – it all adds up. Budget anywhere from $2,000 to $5,000 depending on how much you're moving and how far.
  
  

The ongoing costs of owning a home

Settlement day isn't the end of it either.

Once you actually own the property, a new set of ongoing costs need to be factored into your regular household budget.

These won’t come as a shock if you plan for them, but they can quickly add up if you don’t.

• Mortgage Repayments
  

  This one's obvious, but it's worth stress-testing your budget against different interest rate scenarios. Rates move, and if you're on a variable loan, your repayments will too. Make sure there's breathing room in your budget for rate rises or unexpected income changes.
  
  

• Council and Water Rates
  

  Council rates fund local services like waste collection and road maintenance. In SA, expect roughly $1,500 to $3,000 a year depending on the area. Water and sewerage adds another $1,000 to $2,000 annually. Bills arrive quarterly, so plan accordingly.
  
  

• Strata or Body Corporate Fees
  

  If you’re buying an apartment, strata fees cover shared areas and building maintenance. Depending on the complex and its amenities, these can range from $1,000 to $5,000 or more per year. Before buying, check current fees and ask about any major works on the horizon that might trigger special levies.
  
  

• Insurance Premiums
  

  Your building and contents insurance isn't a one-off cost. But our advice? Review it annually – insurers have a habit of creeping premiums up over time. If you're renting the property out, you’ll also need landlord insurance to cover risks like unpaid rent or tenant damage.
  
  

• Utilities 
  

  Electricity, gas, water, internet are all part of the package. Budget around $200 to $400 a month, but remember that you’ll probably see spikes in summer and winter when heating and cooling costs skyrocket. Energy-efficient properties cost less to run, which is one advantage of new or modern builds.
  
  

• Maintenance and Repairs
  

  Hot water systems blow up. Roofs leak. Taps drip. So a good rule of thumb is to set aside around 1% to 2% of your property’s value each year for maintenance and repairs.

  On a $500,000 home, that's around $5,000 to $10,000 annually. You won't spend it every year, but when something breaks, you'll be glad it's there.

How to approach your budget

Knowing the costs is one thing. Planning for them is another.

And the best way to plan properly, is to have a clear idea of what’s coming up.

Start by listing every upfront expense you can identify, then add a buffer of around 10% to 15% for the things you didn’t see coming.

If you’re buying an investment property, calculate your expected rental income against all ongoing costs to understand your real cash flow position.

For owner-occupiers, make sure your repayments and regular bills are manageable even if life throws you a curveball - a rate rise, a redundancy, an unexpected repair… you get the idea.

Working with a mortgage broker, financial planner or conveyancer early in the process helps you identify gaps in your budget and negotiate better deals on fees and rates. Don't go it alone if you don't have to!

Why understanding expenses matters more than ever

There's a reason so many buyers feel a little blindsided after settlement – especially if it’s their first time purchasing property, or it’s been a long time since they did.

The focus naturally tends to be on the big numbers, like the purchase price and the deposit.

But reality is, property ownership is a long game, and the costs that catch people out aren't usually the headline figures.

What we're seeing in South Australia, and indeed nationally, right now is buyers entering the market with very slim buffers thanks to cost-of-living pressures, soaring house prices and a lack (or overload!) of incorrect or incomplete information floating around online or in the media.

All of this makes understanding the full cost picture not just helpful, but essential.

The buyers who tend to do well aren’t necessarily the ones with the biggest deposits or the highest incomes. They’re the ones who plan realistically, build in buffers and make decisions based on total cost of ownership - not just what the bank tells them they can borrow.

Because when you buy within your means, you give yourself room to weather the storm when the unexpected hits – rate rises, redundancies, repair bills… life! And that’s what will set you apart from those who end up financially hamstrung.

And as for Adelaide buyers open to exploring new-build or off-the-plan options, there are some really great financial incentives worth exploring too - from first homeowner grants to stamp duty relief - that can free up even more cash.

Despite all the expenses involved, it’s worth remembering that property ownership is still one of the most effective ways to build long-term wealth in Australia.

But like any investment, it works best when you go in with your eyes wide open.

And if you’re ready to explore what’s available, or simply want to talk through whether a particular property type makes sense financially? The team at Cedar Woods is always available to guide you through the current exciting opportunities in new and off-the-plan homes in Adelaide!

Cedar Woods Properties is a leading, national developer of residential communities and commercial developments.

We strive to create quality homes, workplaces and communities that people are proud of.

With award-winning projects in Western Australian, Victoria, Queensland and South Australia, we continue to place great importance on understanding our customers and their lifestyle, producing design solutions to enrich their lives.

For more than 30 years we have worked hard to think ahead, evolving our designs to always respond to the changing world in which we live and creating meaningful places that inspire connection and help us grow.

We work with our customers every step of the way to create a solid foundation for their future.

Because at Cedar Woods we know we are developing tomorrow, today.

DISCLAIMER: All recommendations made by Cedar Woods are general in nature and not to be relied upon as legal or financial advice. To ensure accuracy, we always strongly recommend seeking independent, professional advice tailored to your specific situation before making any investment or financial decisions.