Conveyancing costs for buyers and sellers
Conveyancing for buyers and sellers usually means engaging a licensed conveyancer or solicitor to handle the legal work involved in a property transaction, charged either on a sliding scale (base fee) or a fixed amount. Buyer and seller fees do not follow a universal rule. A seller requires contract preparation and disclosure work, while a buyer generally requires contract advice, searches and due diligence. The cost depends on the pricing structure and particular transaction.
Buyers
Fixed-fee conveyancing for buyers usually includes all searches and disbursements, whereas a sliding scale rate means that some costs are charged separately. While the base amount may seem low and more attractive, it may cost more and make it challenging to budget appropriately during a property transaction. Buyers can expect to pay between $1,500 and $2,500 for conveyancing in NSW.
Sellers
A seller incurs legal work before the property is even advertised. In NSW, a sale contract must be prepared before residential property is offered for sale. Depending on the property, the contract package can require title and plan documents, dealings registered on title, drainage information, a section 10.7 planning certificate, prescribed cooling-off information and additional pool or off-the-plan documentation. Sellers can expect to pay between $2,000 and $3,000 for conveyancing in NSW.
What is the difference between sliding scale and fixed-fee conveyancing?
Sliding-scale conveyancing means that conveyancers may charge a ‘base fee’ for their time and expertise, plus additional charges for all searches and extra work. The cost of disbursements will be charged separately and may vary depending on the location and type of property.
Disbursements refer to the costs incurred during the conveyancing process. These can include title searches, council rates certificates, compliance certificates, registration of mortgage fees, transfer fees, and land tax certificates.
Fixed-fee conveyancing typically includes disbursements, allowing buyers and sellers to more accurately budget for the associated costs. There are no nasty bill surprises at the end.
Can you do conveyancing yourself?
NSW recognises DIY conveyancing in principle, but an unrepresented individual’s practical ability to complete land-registration and electronic settlement steps is limited. Anyone considering DIY conveyancing should confirm the current LRS and electronic-settlement requirements before proceeding.
So, what could go wrong if you do it yourself? You could miss a property search that reveals the home has an extreme flood risk, making it uninsurable. You could make a mistake with the entity details you’re buying or selling under, or worse, enter into a contract for the wrong property. If you purchase a limited title property, there may be other considerations you haven’t factored in.
Professional, licensed conveyancers must have professional indemnity insurance. This protects you if they make a mistake or are negligent. You also have consumer rights if you have a concern with a lawyer or conveyancer in NSW. You will not have this protection if you do the conveyancing yourself, which means the legal and financial implications of a mistake are significant. If you’re buying or selling a property worth over a million dollars, a question to ask is whether the risk is worth it.
In many instances, we have seen buyers waive their rights to cooling-off periods without understanding the implications. Without the right advice, this could be a problem. The property settlement process itself can be complicated to finalise on your own without any prior experience, resulting in unexpected and costly mistakes.
These issues may be complex for a layperson to identify and can create numerous problems, complicating what should have been a straightforward process. It costs much more to fix a mistake than to get it right in the first place.
Inconsistencies or errors in the contract can also impact the property transfer, potentially resulting in the forfeiture of your deposit. When reviewing the Contract of Sale, a property lawyer or conveyancer knows what to look for and can ensure everything is in order.
Getting legal advice on the contract ahead of time can protect both buyers and sellers. Sometimes, you may need advice beyond the property transaction, especially if there are issues with the title or boundaries. It may also be worth understanding the differences between a property lawyer and conveyancer to make an informed decision.
Who pays conveyancing fees?
Each party is responsible for paying conveyancing fees to their legal representative. Your conveyancer may take all or part of their fee at settlement, reducing your upfront costs; however, their fees will still need to be paid one way or another.
Conveyancing fees can be paid by the other party if this is negotiated as part of the contract.
What isn’t included in conveyancing fees?
Separate home-buying costs such as transfer duty, lenders mortgage insurance, pest and building reports, strata reports, mortgage registration, loan application and valuation charges and other ownership costs are not included in your conveyancing fees.
Transfer duty
It’s important not to confuse conveyancing fees with transfer duty (stamp duty). Transfer duty is a NSW Government tax paid by a purchaser and is calculated separately according to the property’s dutiable value. First-home-buyer exemptions or concessions may apply under the First Home Buyers Assistance Scheme (FHBAS).
Building and pest inspections
Building and pest inspections are usually conducted by a licensed professional and the fees can vary widely depending on the age and size of the house, experience of the building and pest inspector and location of the property. Hipages places prices at around $200 to $300 for smaller properties and $400 to $500 for average properties, while pest inspections can cost an extra $100 to $150.
Strata reports
With over 85,000 strata schemes in NSW according to government data, there may be a chance you’re buying a strata property. Getting a strata report before buying is always recommended because the report may reveal issues that aren’t visibly obvious. For example, some strata reports have restrictions on types of pets allowed or there may be significant building defects or planned works that you may not be able to budget for. In our experience, this typically costs between $300 and $400.
Borrowing costs
Additional costs, including lenders mortgage insurance (LMI), mortgage registration and loan application fees, are not covered by conveyancing fees. These vary by lender and loan amount, and are best confirmed directly with your financial institution.
Is it worth hiring a conveyancer?
Hiring an experienced conveyancer can streamline the complex process of property transactions, ensuring all legal aspects of ownership transfer are diligently managed. While it may seem tempting to do it yourself or to hire the cheapest conveyancer you can find, experience can help avoid expensive mistakes.
At RS Law Group, we provide fixed-fee conveyancing and same-day contract review to help our clients achieve their goal of selling or buying a home in NSW with complete peace of mind.
As a property lawyer with significant expertise in conveyancing, we understand the complexities of property law and can advise you on various aspects of the property transaction to protect your interests. Our conveyancing costs are competitive and transparent, and we offer comprehensive property law expertise.
