Buying a house in NSW: step by step
Buying a residential property in NSW involves more steps than most people expect. This guide walks you through the entire process in plain English, from working out your budget to receiving the keys on settlement day, with pointers to the legal and financial steps where specialist help matters most.
Step 1: Work out your budget and borrowing capacity
Before you start inspecting properties, it is worth getting a realistic picture of what you can borrow and what a purchase will cost in total. Lenders assess your borrowing capacity based on income, existing debts, living expenses, and the size of your deposit.
A deposit of at least 20% avoids Lenders Mortgage Insurance (LMI), which can add thousands to the cost of a purchase if your deposit is below that threshold. Some buyers use the First Home Guarantee to buy with a 5% deposit without paying LMI (subject to eligibility and property price caps).
First home buyers in NSW should also check whether they qualify for the First Home Buyers Assistance Scheme, which can eliminate transfer duty entirely on properties up to $800,000. See our full guide: First home buyer NSW: grants, stamp duty exemptions, and how to apply.
Step 2: Get mortgage pre-approval
Pre-approval (also called conditional approval or approval in principle) is a lender's confirmation that, subject to the property and final checks, they are prepared to lend you up to a specified amount. It is not a guarantee of finance, but it tells sellers and agents that you are a serious buyer and gives you a realistic spending ceiling.
Pre-approval typically lasts 3 to 6 months depending on the lender. The formal application and valuation of the specific property comes once you have an accepted offer. Note that pre-approval does not lock in an interest rate.
Step 3: Understand the full cost of buying
The property purchase price is only one part of the total cost. Budget for all of the following:
- Transfer duty (stamp duty): The largest additional cost for most buyers. Calculated on the purchase price (or market value if higher) using the rates set by Revenue NSW. On a $750,000 purchase the general rate is $28,518. First home buyers may pay nothing on properties up to $800,000. See our detailed guide: Transfer duty (stamp duty) in NSW: rates, calculator, and exemptions.
- Conveyancing fees: Your conveyancer's or solicitor's professional fee plus disbursements (searches, PEXA fees, title registration). Licensed conveyancers typically charge less than solicitors for a standard residential transaction. See: How much does conveyancing cost in NSW?
- Building and pest inspection: Typically $400 to $800. Not required by law but strongly recommended before exchange to identify structural issues or pest activity. You bear the cost even if the results lead you not to proceed.
- Lenders Mortgage Insurance: Payable if your deposit is less than 20% and you are not using a guarantee scheme. Protects the lender (not you) and can add 1 to 3% of the loan amount to your costs.
- Mortgage registration fee: A small government fee for registering the mortgage on the title with NSW Land Registry Services.
- Moving costs, utility connections, council rates adjustment.
Step 4: Find and inspect properties
Use a combination of realestate.com.au, domain.com.au, and local agents to identify properties in your target suburbs. Attend open homes and, for properties you are serious about, arrange a private inspection.
At this stage it is also worth researching recent comparable sales (comparable sales data, or "comps") so you have a realistic sense of what properties are actually selling for versus asking prices or agent guides.
Keep a record of your inspections and note anything that raises questions about the property's condition, planning status, or strata management (if applicable). These are things your conveyancer will investigate through searches.
Step 5: Make an offer or bid at auction
Private treaty (making an offer)
Most properties in NSW are sold by private treaty: the vendor sets an asking price and buyers make offers, usually through the agent. An offer is not legally binding until contracts are exchanged. You can negotiate price, settlement period, and special conditions during this phase.
Even before your offer is formally accepted, you should request a copy of the contract of sale from the selling agent so your conveyancer can review it.
Auction
Buying at auction works differently. When you are the successful bidder, you sign the contract and pay the deposit immediately. There is no cooling-off period at auction. You are unconditionally committed from the moment the hammer falls. This means any issues with the contract or the title need to be identified and resolved before you bid.
Arrange a pre-auction contract review with a conveyancer before the auction day. This is a paid service but can be one of the most valuable investments in the buying process. See our guide: Cooling-off period in NSW: what it means and when it does not apply.
Step 6: Engage a conveyancer or solicitor
Once you have found a property you are serious about, this is the time to engage a conveyancer or solicitor. They will:
- Review the contract of sale and advise on any issues or risks
- Conduct due diligence searches (title, planning certificate, drainage diagram, land tax clearance, and others relevant to the property)
- Negotiate any changes to the contract conditions
- Handle the exchange of contracts and hold your deposit
- Manage all pre-settlement and settlement steps with your lender and the vendor's side
- Complete electronic settlement through PEXA
- Ensure transfer duty is assessed and paid correctly, and that any applicable exemptions or concessions are claimed
On the question of which type of professional to engage, see:
Conveyancer vs solicitor in NSW: which do you need?
On how to choose between providers, see:
How to choose a conveyancer in NSW.
For most straightforward residential purchases, a licensed conveyancer provides the same practical outcome as a solicitor at a lower professional fee. If your transaction involves broader legal complexity (such as an estate, a trust, or a dispute), a solicitor may be more appropriate.
Step 7: Contract review, exchange, and cooling-off
Your conveyancer reviews the contract of sale and advises you on any concerns. They may negotiate special conditions with the vendor's solicitor, for example:
- Making the contract subject to satisfactory building and pest inspection
- Making the contract subject to finance approval
- Adjusting the settlement period
- Amending inclusions and exclusions (fixtures, appliances, and so on)
Once both parties are satisfied, contracts are exchanged: each party signs identical copies of the contract, the buyer pays the initial deposit (commonly 0.25% at exchange by private treaty, with the balance to 10% due within the cooling-off period or at exchange by agreement), and both parties are bound to proceed.
For a private treaty purchase, you then have a 5 business day cooling-off period. If you withdraw during this period you forfeit 0.25% of the purchase price. After cooling-off expires, you and the vendor are legally committed.
The exchange is the most significant legal step in the purchase. It is at this point that the contract becomes binding, not when you had your offer accepted.
Step 8: Prepare for settlement
In the period between exchange and settlement (typically 42 days), your conveyancer will:
- Prepare transfer documents and lodge them with NSW Land Registry Services
- Liaise with your lender to confirm mortgage funds will be available for settlement
- Conduct a pre-settlement title search to confirm no new encumbrances have been added
- Calculate and agree settlement adjustments with the vendor's side (adjustments are made for council rates, water charges, and strata levies paid in advance or in arrears)
- Confirm PEXA workspace details with the vendor's conveyancer
You are entitled to carry out a final inspection of the property shortly before settlement, usually within the last few days. This is to confirm the property is in the same condition as at exchange and that any agreed inclusions are still in place.
Step 9: Settlement day and getting the keys
Settlement in NSW now takes place electronically through the PEXA platform. On settlement day, the parties' conveyancers (and the lenders' representatives) connect in the PEXA workspace and:
- The buyer's deposit (held in the conveyancer's trust account) and mortgage funds (from the lender) are transferred to the vendor
- The transfer of title is lodged simultaneously with NSW Land Registry Services
- Ownership passes to you the moment the transfer is lodged and accepted
Your conveyancer will contact you once settlement has completed successfully. The agent will then release the keys to you.
For a detailed walkthrough of what happens on the day, see: Settlement day in NSW: what to expect.
Step 10: After settlement
Once settlement is complete:
- Title registration: NSW Land Registry Services registers the transfer and your ownership is recorded on the title. This happens automatically as part of the PEXA settlement process.
- Council rates and water: Contact the local council and Sydney Water (or relevant water authority) to transfer accounts into your name.
- Utilities and insurance: Arrange connection of electricity, gas, and internet. Building insurance should be in place from the day of exchange (at that point risk passes to the buyer in most NSW contracts), not just from settlement.
- Land tax: If you are purchasing an investment property (not your principal place of residence), land tax obligations may arise. The Revenue NSW land tax page sets out who is liable and how it is calculated.
- Mortgage and offset accounts: Confirm all lender accounts are set up correctly and that your mortgage repayments are scheduled.
Common questions
How long does buying a house in NSW take?
From having an offer accepted to settlement, most NSW residential property purchases take 6 to 10 weeks. The pre-exchange phase (conveyancer review, searches, finance approval) typically takes 1 to 3 weeks. The settlement period itself is usually 42 days (6 weeks) by convention, though buyers and sellers can agree to shorter or longer periods in the contract.
Do I need a conveyancer to buy a house in NSW?
There is no law that requires a buyer to engage a conveyancer, but in practice almost all buyers do. Under the Conveyancing (Sale of Land) Regulation 2022, the seller's contract must include prescribed documents (title search, zoning certificate, drainage diagram) that need professional interpretation. More practically, most lenders require their own legal representation for the mortgage, and PEXA electronic settlement requires a licensed practitioner as your subscriber. A conveyancer's fee is modest relative to the property price and the risks of getting the process wrong.
How much is stamp duty (transfer duty) when buying in NSW?
Transfer duty in NSW is calculated on the greater of the purchase price or the property's market value. For a $750,000 purchase the duty is $28,518 (general rate as at 2026). First home buyers purchasing a property for $800,000 or less may qualify for a full exemption under the First Home Buyers Assistance Scheme; partial concessions apply up to $1,000,000. Use the Revenue NSW transfer duty calculator at revenue.nsw.gov.au for your exact amount.
What happens on settlement day in NSW?
On settlement day, your conveyancer and the seller's conveyancer complete an electronic settlement through the PEXA platform. The purchase funds (your deposit held in trust plus mortgage funds from your lender) are transferred to the seller, the transfer of title is lodged with NSW Land Registry Services, and ownership passes to you. Your conveyancer will notify you once settlement has completed and the keys can be released by the agent.
What is the cooling-off period when buying in NSW?
For most private treaty (non-auction) purchases in NSW, the buyer has a 5 business day cooling-off period after exchange of contracts. During this period you can withdraw from the contract, but you will forfeit 0.25% of the purchase price. There is no cooling-off period for properties purchased at auction, or where the buyer signs a Section 66W certificate waiving their cooling-off rights. Buying at auction means you are unconditionally committed from the moment the hammer falls.
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Conveyancing Explained provides general information about property transactions in New South Wales. It is not legal advice and does not create a client relationship. For advice on your situation, engage a licensed NSW conveyancer or a solicitor.