Know your home ownership costs

ENTERING the property market is a new and exciting adventure, though it is not one that should be taken lightly.

An easy trap for first-home buyers is to not take notice of the extra costs associated with home ownership. There are many fees, rates and costs that continue long after the initial purchase.

Stamp Duty

In the ACT, people who purchase property must pay duty on that purchase upon transfer of the property. The rate of duty payable depends on the type of property purchased and its value.

Rates

Property owners in the ACT are required to pay rates to provide funding for a wide range of municipal and other essential services to the ACT community.

Municipal services provided in the ACT include:

  • Building and maintaining roads, bicycle paths and footpaths;
  • Establishing and maintaining recreational areas such as swimming pools, public libraries, halls and community centres; and
  • Garbage and waste disposal services, stormwater drainage, street lighting and cleaning.

If payment is not received by the due date, you will be charged interest. Unpaid interest sums accrue interest which compounds monthly until paid in full.

On the flip side of the coin, home owners who pay their entire annual rate bill upfront at the start of the financial year (as opposed to quarterly) are entitled to a discount on their rates for that year.

Land tax

Land tax is applicable to all rateable commercial properties and any residential properties that are rented out or owned by a trustee or corporation.

It is also applicable to boarding houses and multiple dwelling properties, including dual occupancies and granny flats.

The marginal rates used to calculate land tax are determined under the Taxation Administration Act 1999.

Next: Finance - Loans

CONTACT US

Next: Finance - Loans