Hidden Costs of Buying A Car in Australia

When it comes to buying a car, all you pay is the advertised price right? Wrong.

On top of the vehicle’s price, there are actually quite a few hidden costs that you will need to pay before you can get your hands on your new vehicle.

Here are the Hidden Costs of Buying a Car in Australia.

1. Dealership Admin Costs

If you are looking to buy a Car from a Dealership, you should expect to pay a fee on top of the vehicles advertising price. Most dealers add an additional “admin fee” on top of the vehicle’s price to compensate for their services and vehicle advertising costs.

Dealership Admin Costs will vary from dealership to dealership but based on the average cost in 2022 you should expect to pay between $200 to $400 in dealer fees. It is important that you are aware of this expense as it cannot be included in your loan amount and will need to be paid directly to your dealership of choice.

2. Loan Fees

On the topic of Loans, if you are using a loan to buy a car, you will need to pay loan fees. A loan fee is a fee set by the lender to set up and organize your loan. Like mentioned in point number one, you will have a loan amount plus an incurred cost – Loan Fee.

The loan fee amount that you will need to pay will differ from lender to lender. Some lenders may waive the loan fee entirely, but you should be expected to pay that amount. It is important that you consult with your lender of choice and understand their fee amount prior to agreeing.

3. Stamp Duty

Stamp Duty is only for houses, right? Well, actually you will need to pay stamp duty for your car as well! Stamp Duty is an added tax on top of the vehicles price that you need to pay. This doesn’t go to the dealer or seller, but to the Government.

This is where it can get a little bit tricky. Some dealerships include Stamp Duty in the advertised price. It is important that you ask the dealer if the price is inclusive of stamp duty or not prior to purchase. The amount that you have to pay for stamp duty will differ from state to state. It is always best practice to understand and find the correct stamp duty amount prior to purchase from the official state government website.

4. Vehicle Inspection Costs

If you are buying a used car, it is always recommended that you get an independent, third-party mechanic to assess the vehicle’s condition. Getting an independent mechanic to assess your car will offer you greater protection and reduce the risk of buying a lemon, but you will need to pay for it.

If you are looking to get an independent mechanic to assess your vehicle you should expect to pay in between $150 - $300 depending on your location. This may seem like a lot of money upfront, but it could save you thousands in the long run!

5. Car History & PPSR Reports

A Car History & PPSR report are official third-party documents that highlight a vehicles history, stolen status and if there is any finance owed on the vehicle. If you are looking to purchase a Used Car, you may need to purchase a Car History and PPSR Report depending on how you are buying the vehicle.

This one can go either way, some dealerships may provide these reports free of charge, others will not. No private seller will provide a Car History or PPSR Report to potential buyers. It is important to consider this expense if you are looking to purchase a car. In terms of price a Car History Report is $40* and a PPSR is roughly $15*.

*Prices are not set in stone and often change.

6. Registration Fees

The last hidden cost that you need to take into consideration is Government Registration Fees. To purchase a vehicle, you need to register the vehicle to your name. To do this costs money.

Like Car History Reports, the price of registration will differ from state to state and often changes. To find out registration fees in your state it is always best to check the official state government website.

Final Word,

There are more costs that you need to consider when buying a car than just the advertised price. As such, you need to have an extra thousand or so dollars available to cater for the hidden expenses. The 5 expenses mentioned above are common when buying a car in Australia in 2022.

We hope you enjoyed reading this article. To read more articles like this, please visit the Shop for Cars latest news page here.

About Shop for Cars,

Shop for Cars is Australia’s first car dealership-only online classified. Shop for Cars brings you the best quality new and used vehicles from trusted motor dealers Australia wide. Shop for Cars currently has over 12,500 cars listed for sale all from licensed Motor Vehicle Dealers ONLY.

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DISCLAIMER: This is all based on opinion please research and consult with all relevant parties to make the best-buying decision.