Moving house: it all adds up

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You've scraped the deposit together and it's off to buy a new house. But don't forget that it's not just the mortgage lender who wants your
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Monday, July 19th 1999, 12:00AM

by Paul McBeth

You've scraped the deposit together and it's off to buy a new house.
But don't forget that it's not just the mortgage lender who wants your money. First-home buyers can need as much as five to ten per cent of the house value to cover all the other bills they'll face; and those upgrading won't escape lightly either.
The obvious ones like legal fees and insurance are often joined by inspection costs and a host of other charges that Chris Mulcahy of Leaders Real Estate says can add at least another $4000 or $5000 you mightn't be counting on.
"People can also forget to allow for basic maintenance - you might have to fix the spouting when you move in or put up curtains (a lot of houses are sold without them). Depending on the area, you might want to change the locks too...it all adds up if you've already stretched yourself to meet the house price."
Chris says another common cost that hits buyers is the fee for breaking investments, as they can often have money tied up that is needed to meet payment deadlines.
So here's a quick checklist of some bills you could be up for (any prices given are indicative only):

Legal costs: a lawyer will have to do the conveyancing for you. Say $600 to $1,000

Registered valuation: usually required by the mortgage lender. $300 to $500

Pre-purchase checks can include:

Builder's inspection: to confirm the structure of the house is sound and highlight any problem areas or impending maintenance. $250 to $400.

Engineering inspection: not so common, but you may want one if you're concerned about ground stability (there's a bank near the house, say, or it's built on fill). Around $400.

Council reports: you might want to check that permits have been granted for all recent work to the property or get more detailed information about zoning of the land and permitted uses, location of services in relation to your property and so on. Check with your local authority on cost.

Once you've bought the house, there's all the personal stuff:

House insurance: a completely new cost if you didn't already own a house and obviously more money if you're buying a larger place. Either way, another drain on the pocket.

New furniture: Maybe your old sofa won't fit through the door. Maybe you don't even own anything to sit on yet.

Moving costs: Hundreds of dollars or more, especially if you're moving to another area. If you're not going straight from one place to another, you'll be hit with storage costs as well. Don't forget insurance for your goods in transit (get a quote from your own insurance company as well as the moving firm).

Urgent repairs: all those things you didn't notice when you were buying the place.

Getting connected: fees for hooking up power/gas/phone/Internet/cable TV. You could be hit with a deposit or bond if you don't have an existing account. You might also need to install extra power points, phone jack-points or TV aerials, especially if you're working from home.

Paul is a staff writer for Good Returns based in Wellington.

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