--- title: "A $700K Melbourne House Actually Costs $756,000. Here Are the 6 Hidden Fees." description: "The 6 hidden costs of buying a $700K property in Melbourne: stamp duty ($37K or $25K for FHB), conveyancing, building inspection, bank fees, and the PR trap that costs $56K." author: Joey Don date: 2025-08-07 category: Market Analysis url: https://premiumrea.com.au/blog/melbourne-hidden-buying-costs-56000-extra tags: ["buying costs", "stamp duty", "conveyancing", "Section 32", "first home buyer", "Melbourne", "settlement"] --- # A $700K Melbourne House Actually Costs $756,000. Here Are the 6 Hidden Fees. *By Joey Don, Co-Founder & CEO at PremiumRea — 2025-08-07* > My mate nearly had a meltdown the week before settlement. He'd budgeted for the deposit. He hadn't budgeted for the other $56,000. A friend messaged me a week before his settlement date in near-panic. He'd just received the cost breakdown from his conveyancer and the numbers were $30,000 more than he expected. He'd saved a 10% deposit — $70,000 on a $700,000 house. He thought that was all he needed. Stamp duty, legal fees, building inspection, bank charges, and a dozen other line items he'd never heard of pushed his total upfront cost past $125,000. "I thought the deposit was all I needed," he said. This is embarrassingly common. Especially among first-time buyers and new migrants who haven't been through the Australian settlement process before. So let me lay out every single cost, line by line, on a $700,000 Melbourne house. ## 1. Stamp duty: the biggest hit Stamp duty is the single largest extra cost when buying property in Victoria. For a $700,000 property purchased by a non-first-home buyer: approximately $37,070 [1]. For a first-home buyer: approximately $24,713 (the concession applies between $600K and $750K on a sliding scale). That's a difference of $12,357. If you qualify as a first-home buyer, this is the single biggest saving available to you. For properties under $600,000, first-home buyers pay zero stamp duty. Under $750,000, there's a partial concession. Above $750,000, no concession at all. If you're buying off-the-plan, there's an additional concession where stamp duty is calculated on the land value only (excluding construction), which can reduce the bill by 70-80%. This concession has been extended to October 2026 [2]. And here's the big one: foreign buyers (non-PR, non-citizen) pay an additional 8% foreign purchaser surcharge. On a $700,000 property, that's $56,000 extra. Getting your PR before buying literally saves you the price of a new car. ## 2. Conveyancing / legal fees: $1,000-$2,500 You must engage a conveyancer or solicitor for any property purchase in Victoria. They handle contract review, Section 32 analysis, title searches, settlement coordination, and PEXA (electronic settlement) processing. Cost: $1,000 to $2,500 depending on complexity [3]. Do not skip this. The Section 32 (Vendor's Statement) is a uniquely Victorian document that discloses everything about the property: easements, covenants, zoning, planning overlays, owners corporation details, outgoings, and any registered encumbrances. A good conveyancer will flag issues that could cost you tens of thousands of dollars. A drainage easement across the backyard. A restrictive covenant that prevents multi-dwelling development. A planning overlay that limits building height. These aren't hypothetical risks — they're things we see every month in Section 32 documents. I've seen buyers who skipped the Section 32 review and discovered post-settlement that their property had a heritage overlay preventing any facade changes. That discovery cost one buyer the entire development potential of the property — roughly $150,000 in lost value [4]. ## 3-6. The other costs that add up **3. Building and pest inspection: $500-$800.** A registered building inspector examines the property for structural defects, moisture damage, termite activity, roof condition, plumbing, and electrical. This is optional but refusing to get one is financial recklessness. A $500 inspection that reveals $35,000 in restumping costs saves you from a disaster [5]. **4. Bank/lender fees: $500-$1,500.** Loan application fee, property valuation fee, and settlement processing fees. These vary by lender. Some lenders waive the application fee for competitive deals. Always ask. **5. Lenders Mortgage Insurance (LMI): $0-$25,000.** Only applies if your deposit is less than 20% of the purchase price. On a $700,000 property with a 10% deposit, LMI can run $12,000 to $18,000. With a 5% deposit, it can exceed $25,000. This is the most avoidable cost on the list — save the full 20% deposit and it disappears entirely. **6. First Home Owner Grant: +$10,000.** This isn't a cost — it's money back. If you're a first-home buyer purchasing a new build under $750,000, you get $10,000 from the state government. It doesn't apply to established properties. But if you're buying a house-and-land package or a brand new dwelling, claim it [6]. **The total picture on a $700,000 property:** Non-first-home buyer: $37,070 (stamp duty) + $2,000 (legal) + $600 (inspection) + $1,000 (bank fees) = approximately $40,670 in additional costs beyond the deposit. First-home buyer: $24,713 (stamp duty) + $2,000 + $600 + $1,000 - $10,000 (FHOG if new build) = approximately $18,313. Foreign buyer: add $56,000 surcharge = approximately $96,670. Know these numbers before you start looking at properties. Not after you've signed the contract and are scrambling to find an extra $40,000 a week before settlement. That's how you end up defaulting on a contract and losing your 10% deposit as a penalty — a $70,000 mistake that ruins your property journey before it starts. ## References 1. [State Revenue Office Victoria, Land Transfer Duty Calculator. Rates for residential property purchases.](https://www.sro.vic.gov.au/calculators/land-transfer-calculator) 2. [SRO Victoria, 'Off-the-Plan Concession'. Stamp duty calculated on land value only, extended to October 2026.](https://www.sro.vic.gov.au/off-the-plan-concession) 3. [Law Institute of Victoria, 'Conveyancing Costs Guide'. Typical fee range for residential property transactions.](https://www.liv.asn.au/) 4. [PremiumRea client case: heritage overlay discovered post-purchase, ~$150K development value lost.](#) 5. [Housing Industry Association, 'Pre-Purchase Building Inspection Guide'. Scope and cost of residential inspections.](https://hia.com.au/) 6. [SRO Victoria, 'First Home Owner Grant'. $10,000 for new residential properties under $750K.](https://www.sro.vic.gov.au/first-home-owner) --- Source: https://premiumrea.com.au/blog/melbourne-hidden-buying-costs-56000-extra Publisher: PremiumRea (Optima Real Estate) — Melbourne buyers agent