Costs of Buying & Holding an Investment Property in Australia

Thinking of growing a portfolio of three, four, or even five investment properties? Before you dive in, it’s essential to get a clear picture of what it really costs to buy and hold property in Australia. From hidden upfront fees to ongoing maintenance and management costs, many investors underestimate the financial commitment required, especially when scaling. In this guide, we break down every major expense you’ll face, show you how to plan for them, and share smart strategies to keep your portfolio scalable and sustainable.

Upfront Costs of Buying an Investment Property

When it comes to buying an investment property in Australia, you’ll face two main types of expenses: upfront acquisition costs and ongoing ownership costs. Let’s start by breaking down the acquisition costs, this is the initial out-of-pocket expenses required to secure the property.

• Acquisition Costs (upfront)
• Ongoing Costs (ownership and maintenance)

1. Acquisition Costs

Acquisition costs are the upfront expenses you’ll pay when purchasing an investment property. These include:

• Deposit: Most lenders require a 10% deposit, although some investors choose to contribute more, such as 12% to reduce or avoid Lender’s Mortgage Insurance (LMI).
  
  
• Stamp Duty: This government tax varies by state and can significantly impact your budget. It’s important to factor it in when calculating your total cost.
  
  
• Conveyancing Fees: You'll need a solicitor or conveyancer to handle the legal side of the purchase, including reviewing contracts and managing settlement.
  
  
• Pest and Building Inspections: These inspections are essential, especially for older homes. They help uncover structural issues or pest infestations that could cost you later.
  
  
• Buyers Agent Fees (optional): While not mandatory, a buyers agent offers valuable advantages—like access to off-market listings, deep market insight, and quicker, more strategic decision-making.

Example Breakdown:

• Property Price: $456,000
• 12% Deposit: $54,720 (to reduce LMI)
• Stamp Duty: $16,140
• Conveyancing + Inspections: $3,000

Total Upfront Cost (excluding buyers agent fee): $73,860

Many people wrongly assume a 20% deposit is required. In truth, you can start with less, especially if you work with a buyers agent who understands lender requirements and the property market.

This is where the advantage buyers agents bring becomes clear. The right buyers agent helps property buyers access better deals and start investing with less capital.

2. Ongoing Costs of Holding an Investment Property

Once your investment property is officially yours, the focus shifts from buying to managing your holding costs. These ongoing expenses play a key role in your cash flow, long-term profitability, and how well your property portfolio scales.

Here’s a breakdown of the most common ongoing costs to budget for:

1. Council Rates, Water Rates & Insurance - These bundled property investment expenses will typically cost around $4,500 annually.

2. Property Management - Expect to pay 7% to 10% of rental income. For example, on a $550/week rental, property management will cost $38–$55 weekly. Skimping here could cost you. A great property manager protects your asset and cash flow while ensuring scalable growth across your investment properties.

3. Insurance - Landlord insurance is non-negotiable. From weather damage to problematic tenants, you want coverage. Don’t compromise here—it’s a key part of risk management in property investment.

4. Interest Repayments - While principal repayments build equity, it’s the interest that affects your monthly cash flow. Many investors choose interest-only loans to preserve flexibility.

5. Maintenance and Wear & Tear - Budget $1,000–$2,000 per property annually. Also plan for renovations every 3–5 years, which can range from $7,000 to $50,000. Strategic renovations increase property value and unlock new equity.

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How to Simplify and Streamline Property Expenses

If you're worried about juggling multiple properties, here's the streamlined method I personally use—and it works even if you’ve got a full-time job and a busy life. I have all council rates, water rates, and insurances paid directly through my property manager. The process looks like this:

1. The bills go straight to the manager.
2. They use a portion of your monthly rent to pay the rates and insurance.
3. Whatever’s left is transferred to your account.

Why does this matter?

• You save time by not handling multiple payments.
• At tax time, you receive a single ledger showing your annual income, expenses, and profit/loss. You can send this straight to your accountant.

Using a well-structured system like this doesn’t just save time, it makes scaling your investment portfolio realistic, even for time-poor professionals.

Are Buyers Agents Worth It for Australian Property Investors?

If you're wondering whether a buyer's agent is worth it when buying an investment property in Australia, the answer often comes down to the value of expert support. A professional buyers agent does more than just find properties—they help you navigate the Australian property market, shorten the learning curve, provide strategic advice, and give you access to off-market investment property opportunities that most buyers never see.

While buyer's agent fees may appear to be an additional expense, they are frequently offset by the better deals, cost savings, and time efficiency they deliver. For investors focused on building long-term wealth through real estate, a buyer's agent can be one of the smartest investments you make.

If you're serious about growing your investment property portfolio and want to make smarter, faster, and more confident decisions, book a free discovery call with the Search Property team today. We help you invest with clarity, strategy, and results.