The mortgage repayment is only the starting line
The number your bank quotes for your monthly repayment is the smallest part of what ownership actually costs. Council rates, insurance, utilities, strata levies, and maintenance stack thousands of dollars a year on top, and most buyers only see the full picture after settlement. This step pulls every recurring cost into a single monthly number so you know the real figure before you commit.
- 47% of first home buyers spent more than they budgeted in 2025, up from 38% in 2022 .
- 1 in 7 first home buyers who purchased in the past year have no savings left .
- 1 in 3 first home buyers have less than $10,000 remaining after settlement .
These are not reckless buyers. They are people who planned to the mortgage repayment and treated everything else as an afterthought.
What ownership actually costs each month
Take a first home buyer purchasing a $700,000 property with a $560,000 loan (20% deposit). At a variable rate of 6.2% over 30 years, the monthly mortgage repayment is about $3,430. Most buyers stop there.
Here is what a month of ownership looks like on that house:
Cost | Annual estimate | Monthly estimate |
|---|---|---|
Mortgage repayment ($560,000 at 6.2%, 30 years) | $41,160 | $3,430 |
Council rates | $2,200 | $183 |
Home and contents insurance | $3,000 | $250 |
Water and utilities (electricity, gas, internet) | $4,200 | $350 |
Maintenance reserve (1% of property value) | $7,000 | $583 |
Total (house, no strata) | $57,560 | $4,796 |
That is $1,366 per month on top of the mortgage, or about 40% more than the repayment alone.
If you are buying an apartment or townhouse, add strata levies. For a typical apartment, strata fees range from $3,000 to $8,000 a year depending on the building . Using a mid-range figure of $5,000 a year:
Cost | Annual estimate | Monthly estimate |
|---|---|---|
Mortgage repayment ($560,000 at 6.2%, 30 years) | $41,160 | $3,430 |
Council rates | $1,800 | $150 |
Home and contents insurance (contents only in strata) | $1,200 | $100 |
Water and utilities | $3,600 | $300 |
Strata levies | $5,000 | $417 |
Maintenance reserve (reduced — strata covers building) | $2,000 | $167 |
Total (apartment with strata) | $54,760 | $4,564 |
Apartment owners typically pay lower council rates and insurance (building insurance is included in strata), but strata levies more than fill the gap.
Connecting the number back to your income
The 30% threshold is widely used as the benchmark for housing affordability stress . Apply it to your own numbers. If a household earns $130,000 gross (about $100,000 after tax), 30% of disposable income is $30,000 a year, or $2,500 a month. The house example above comes in at $4,796 a month — well above the 30% threshold for that income level.
To stay under 30%, a household would need roughly $192,000 in after-tax income to comfortably carry the full $4,796 monthly cost. That is the kind of reality check this exercise is designed to provide.
The formula is simple:
Your total monthly ownership cost / your monthly after-tax income = your ownership cost ratio
If that number is above 0.30, you are in the zone researchers define as housing stress. It does not mean you cannot buy — but it means you need to go in with a clear plan and a buffer.
Use this template with your own numbers. Every figure should come from actual quotes, council websites, or recent bills from the property area you are targeting.
Cost | Your annual estimate | Your monthly estimate |
|---|---|---|
Mortgage repayment | $ | $ |
Council rates | $ | $ |
Home and contents insurance | $ | $ |
Water and utilities | $ | $ |
Strata levies (if applicable) | $ | $ |
Maintenance reserve | $ | $ |
Your total | $ | $ |
Where to find each number
- Mortgage repayment: Use the MoneySmart mortgage calculator . Enter your expected loan amount, interest rate, and term.
- Council rates: Search your target council's website. Most publish rate calculators or sample rate notices.
- Insurance: Get quotes from at least three insurers. The gap between the cheapest and most expensive policy can be over $1,500 a year .
- Utilities: Ask the real estate agent for recent utility bills, or use your current bills as a starting point.
- Strata levies: Ask the agent for the current levy notice. Check the strata report for any planned special levies.
- Maintenance: Use 1% of the property value for a house. For apartments, reduce this to 0.3-0.5% since strata covers the building.