Acquisition Costs
All costs incurred to take ownership of a property — stamp duty, legal/conveyancing, building and pest inspections, lender fees, and any due-diligence consultants. In Australia these typically run 4-7% of purchase price for an investor.
Acquisition costs are everything you spend to take ownership of a property, over and above the purchase price itself. For an Australian investor they typically run 4–7% of the purchase price, and the bulk of that is stamp duty. The rest is made up of conveyancing or legal fees, building and pest inspections, lender application and valuation fees, and any due-diligence consultants — a town planner or surveyor on a development site, for example.
They matter to a flipper for one simple reason: they are cash you have to fund at settlement, before a single dollar of value has been added. A common beginner error is to budget the deposit and the renovation but treat acquisition costs as a rounding error. On a $600,000 purchase, 5% is $30,000 — enough to move a deal from viable to marginal on its own.
Where they sit in the deal
Acquisition costs are one of the cost blocks the 70% rule buffer is meant to absorb, which is exactly why that buffer needs to be sized to real AU costs rather than the lighter US assumptions. Most acquisition costs form part of the property's cost base for tax rather than being immediately deductible, though the treatment depends on whether the ATO views your activity as trading on revenue account — worth confirming with an adviser.
The practical takeaway is to itemise them, not estimate them. Get an exact stamp duty figure for your state and price, add realistic conveyancing and inspection quotes, and fold the total into the flip ROI calculation alongside the reno and holding costs. Precision here is cheap insurance against a nasty surprise at settlement.
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