The Real Cost of Buying Your First Home in NSW (It’s More Than the Deposit)

The deposit only gets you to the starting line of your home purchase... here's what else you need to be prepared for

How much money do you actually need to buy your first home?

Most first home buyers spend months (more likely years) focused on one number: the deposit. Which makes sense. It’s the number your broker talks about, the number you’re saving toward, the number that feels like the finish line.

In reality – the deposit only gets you to the starting line of your home purchase. There’s a whole other set of costs coming for you between there and settlement day.

On an $850,000 property in NSW, a buyer could easily need an additional $15,000 to $20,000 on top of the deposit.. That’s not a small number, and the problem isn’t that these costs exist. It’s that they are not as often spoken about, so you may not see the full picture until you’re already committed.

What are the costs First Home Buyers miss?

Let’s break down what’s actually involved beyond the purchase price and deposit.

Stamp Duty

To be fair, most buyers have heard of stamp duty. It’s a government tax on property transactions, and in NSW, it’s calculated based on the purchase price of the property.

The good news for first home buyers: you may be eligible for a concession or full exemption depending on the property value. As of 2026, first home buyers purchasing a property valued up to $800,000 may qualify for a full exemption. Above that threshold, stamp duty applies on a sliding scale.

It’s worth checking your eligibility at Revenue NSW before you start calculating your budget.

Lenders Mortgage Insurance (LMI)

If your deposit is less than 20% of the purchase price, most lenders will require you to pay LMI. This is insurance that protects the lender if you can’t meet your repayments and the property sells for less than what you owe.

LMI can cost anywhere from $10,000 to $30,000+ depending on your loan amount and deposit size.

It’s one of the biggest costs first home buyers don’t see coming, and one of the reasons the 5% Deposit Scheme (more on that below) can be such a game-changer.

Conveyancing Fees

Conveyancing is the legal process of transferring property ownership from the seller to you.

A licensed conveyancer reviews your contract, conducts property searches, liaises with your lender and the seller’s legal team, and manages everything through to settlement. Budget around $2,500 to $3,000 for conveyancing fees, depending on the complexity of your purchase.

One important note: conveyancing isn’t something that happens at the end of the process. Involving a conveyancer early – before you sign anything – is where the real value lies.

Searches and Disbursements

During the conveyancing process, a number of compulsory property searches are conducted. These check things like council zoning, outstanding rates, easements, and planned developments near the property. These are third-party fees, typically in the range of $300–$500, and they’re not optional.

Building and Pest Inspections

Before you exchange contracts, it’s highly advisable (and often a condition of finance) to have the property inspected by a licensed building inspector and pest inspector. These reports tell you about structural issues, moisture, or pest activity that isn’t visible to the naked eye. Budget around $600-$800 for both reports combined.

Yes, you pay for this even if the inspection reveals a problem and you decide not to proceed. Think of it as the cost of information… and potentially the cost of avoiding a very expensive mistake.

Government Registration Fees

When ownership of a property transfers, that transfer needs to be registered with NSW Land Registry Services. These fees are set by the government and are relatively modest, typically around $350, but they’re still a real cost that needs to be in your budget.

PEXA Electronic Settlement Fee

If you’ve never heard of PEXA, you will soon. It’s the electronic settlement platform used in NSW property transactions. There’s a small fee for using it, around $140, but it’s worth knowing about so it doesn’t appear as a surprise line item.

Moving Costs

Often forgotten until the last minute: actually getting your stuff from A to B. A professional removalist for a 2 – 3 bedroom property within the Newcastle region will typically cost from $1,500 to $3,000 depending on distance and how much needs to move.

A Real-World Example

Take a couple buying an $850,000 home in the Newcastle region, both first home buyers eligible for a stamp duty concession and using the 5% Deposit Scheme (which removes the LMI requirement entirely). Their additional costs beyond the deposit would look something like this:

Cost Estimate Stamp Duty (with concession) ~$9,853
Lenders Mortgage Insurance $0 (waived under 5% Scheme)
Conveyancing Fees ~$2,500
Searches & Disbursements ~$400
Building & Pest Inspections ~$700
Government Registration Fees ~$351
PEXA Settlement Fee ~$141
Moving Costs ~$2,000

Total Additional Costs ~$15,945

So even in a relatively favourable scenario – with a stamp duty concession and no LMI – the costs on top of the deposit still come to nearly $16,000. Without those concessions, you could easily be looking at $30,000 to $40,000 in additional costs.

Why This Catches Buyers Off Guard

The reason so many first home buyers are caught short isn’t because they didn’t bother to research. It’s that the tools most people use, like bank calculators, borrowing capacity tools, are built to show you what you can borrow, not what buying will actually cost.

By the time you’re sitting at the kitchen table adding up quotes from a conveyancer, building inspector, and settlement platform, you might already be emotionally committed to the property. That’s a tough position to be in.

The fix is simple: do the full cost calculation before you start looking, not after you’ve found the one.

What You Can Do Right Now

Use a calculator that shows the full picture. We built the Impero Home Buying Calculator specifically because standard bank calculators don’t show you everything. It factors in all the costs above so you know the real number before you start.
Check your stamp duty eligibility. Revenue NSW has an online calculator. First home buyer concessions can save you thousands, but the rules around purchase price thresholds and property types are specific. Check before you assume you qualify.
Find out if the 5% Deposit Scheme applies to you. If you have at least 5% saved and haven’t owned property before, this scheme could remove your LMI requirement entirely… which is one of the biggest cost savings available to first home buyers. Read our full guide to how it works.
Talk to a conveyancer early. Not when you’ve found a property. Before you start looking. Understanding what you’re signing up for – legally and financially – before anything becomes binding is the single best thing you can do to protect yourself.