That dreaded larger than you anticipated expense that feels like it is eating at your hard-earned deposit, also known as stamp duty. This added hurdle to jump when trying to break into the property market or increase your portfolio usually equates to around 4% of the property purchase price and is an added tax in addition to a deposit. A few ways to limit how much you could fork out include:
Buy a cheap home
It may not be what you have always wanted but buying a cheaper home and renovating it to how you envision can save thousands of your hard-earned money going to the government instead of on your very own home.
Build a new home
When building a brand-new home, stamp duty is only payable on the land and not the new home construction, whereas with an established property, stamp duty must be paid on the entire value of the property.
Use a guarantor
An increased loan amount with the Lenders Mortgage Insurance (LMI) fee covered by a guarantor is a way to get around paying so much stamp duty upfront. A guarantor is when another party, usually a family member, offers the equity in their own home as additional protection to secure the loan. This can save you thousands of dollars in fees and the guarantor is not required to make any out of pocket payments, but if you can no longer keep up your loan repayments then the lender will turn to the guarantor to make them.