Quick answer: owning a house in Australia costs much more than the mortgage. Each year you pay council rates, water, energy, insurance, repairs and maintenance, plus strata levies, state levies or land tax where they apply. Most are charged whether or not you use the home, so budget for them before you buy.
Updated 28 October 2026. Council, energy, tax and safety rules checked on government and council websites on the same day.
Key facts, checked 28 October 2026
Three dated facts shape the cost of owning a house this year: the Reserve Bank cash rate that drives your mortgage, Victoria's council rate cap, and Queensland's smoke alarm deadline. Each is from an official source and was checked on 28 October 2026.
- The Reserve Bank cash rate target is 4.60%, after a 0.25 percentage point rise that took effect on 30 September 2026 (RBA cash rate, checked 28 October 2026).
- Victoria's base council rate cap for 2026-27 is 2.75%, and the Essential Services Commission approved a higher 5% cap for Glen Eira on 18 May 2026 (Essential Services Commission).
- Queensland homes need interconnected photoelectric smoke alarms by 1 January 2027 (Queensland Fire Department, page updated 25 August 2026).
The ongoing costs of owning a house: the full list
The main ongoing costs of owning a house are your mortgage, council rates, water and sewerage, electricity and gas, insurance and maintenance. Strata levies, state levies and land tax apply only in some cases. The table shows who charges each cost, how often, and what changes the amount.
| Cost | Who charges it | How often | What changes it |
|---|---|---|---|
| Mortgage repayments | Your lender | Weekly, fortnightly or monthly | Loan size, interest rate, loan term, principal and interest or pay interest alone for a set period |
| Council rates | Your local council | Yearly, often paid in instalments | Your council's rate in the dollar and the valuation of your property |
| Water and sewerage | Your water authority or council | Usually quarterly | Fixed service charges plus how much water you use |
| Electricity and gas | Your energy retailer | Monthly to quarterly | A daily supply charge plus your usage |
| Home (building) and contents insurance | Your insurer | Yearly or monthly | Location, flood and bushfire risk, rebuild cost, excess |
| Strata or body corporate levies | Owners corporation | Usually quarterly | The scheme's budget, sinking fund and your unit entitlement |
| State levies on your rates notice | State government, collected by council | With your rates | Set by the state, for example the Emergency Services and Volunteers Fund in Victoria |
| Repairs and maintenance | You and your tradies | All year | Age and condition of the home, garden, pool, roof |
| Pest and termite checks | Licensed pest controller | Commonly yearly | Termite risk in your area and the type of house |
| Internet and phone | Your provider | Monthly | Plan and speed |
| Land tax | State revenue office | Yearly | Generally not payable on your own home; can apply to investment property and holiday homes |
Moneysmart's guide to buying a house makes the same point in one line: once you buy, update your budget with your mortgage repayments, plus ongoing costs like council rates and land tax (when known). The sections below explain each one in plain words, and how to keep it down.
How council rates are calculated
Council rates are a yearly charge from your local council, worked out by multiplying your property's value by the council's rate in the dollar, then adding fixed charges such as waste. The valuation used differs by state, so similar homes in different states can pay quite different amounts.
Council rates pay for local services such as roads, parks, libraries and waste collection. Each council works out how much money it needs, then sets a rate in the dollar that is multiplied by the value of your property. The South Australian Local Government Association explains it simply: councils divide the funding they need by the total value of properties in the area, and the rate in the dollar is multiplied by the value of each property.
The valuation that is used differs by state, which is why two similar homes in different states can pay very different rates:
- NSW: rates are calculated from valuations supplied by the NSW Valuer General and are tied to the land value (unimproved value) of your property. The Valuer General revalues properties every three years, and rate pegging limits how much a council's total rate income can rise each year.
- Victoria: councils such as Monash base rates on capital improved value (land plus buildings), valued every year by the Valuer-General Victoria. The state's rate cap limits the rise in a council's total general rates each year; the base cap for 2026-27 is 2.75%, set by the Minister for Local Government, and the Essential Services Commission can approve a higher cap for a council that asks.
- Other states: each council's rates page explains the valuation it uses and its rate in the dollar. Most councils publish a rates calculator.
A bigger or more valuable block often pays more, but not in every case: it depends on your council's rate in the dollar, any minimum rate, and fixed charges such as waste. Your rates notice shows the valuation, the rate in the dollar and each charge. Most councils let you pay yearly or in instalments, and pensioners can often get a rebate, so check your notice and your council's website.
Different Council Rates and How They Vary Across Different LGAs
Councils with more parks, pools, libraries and community services can charge more, and waste services differ too. Some councils give you red, yellow and green bins, others fewer, and the waste charge on your notice reflects that. Before you buy, look up the council's rates and waste charges for that street so there are no surprises.
Council Collections and Pick Ups
Many councils also offer bulky waste pick-ups for old furniture and appliances, and some charge to replace a damaged bin. Check your council's guidelines, because there are items they will not take. Small charges like these add up, so look after your bins and book free collections where your council offers them.
Water works the same way: you cannot avoid the fixed charges, but you can control how much you use.
Water Rates and Usage
Water and sewerage bills combine fixed service charges with a charge for the water you use, and your water authority decides how often it bills you, often quarterly. You cannot avoid the fixed charges, but fixing leaks and using efficient fixtures can reduce the usage part of the bill.
Water rates are charged by your local water authority and are based on the amount of water that you use. It’s important to be mindful of your water usage to avoid high water bills.
There are a number of things that you can do to reduce your water usage and lower your bills.
For example, you can install water-efficient appliances and fixtures, like water-saver shower heads, fix any leaks, and reduce your overall water usage by taking shorter showers and using a water-efficient washing machine. Additionally, you can research what water-saving programs your local council may offer.
Water and sewerage are usually billed quarterly, but your water authority decides how and when it bills you. Some read the meter monthly and others twice a year, so check your bill to see how often you are charged for usage. Electricity and gas retailers also bill on their own cycles.
Electricity Connection Rates and Usage
Every electricity plan has a daily supply charge, paid even if you use no power, plus a usage charge for each kilowatt hour. Bills arrive monthly to quarterly depending on your retailer. Comparing plans once a year on Energy Made Easy, or Victorian Energy Compare in Victoria, is the simplest way to lower the cost.
The billing cycle for electricity and usage is anywhere between 1 to 3 months. The date that your bill is generated and sent to you is the bill cycle date. So, your rates notice for example may be generated on the 15th of every month, this means that your billing cycle is the 15th of every month. Otherwise, quarterly or bi-monthly bills come every 2-3 months.
Just like water, electricity rates and usage, Electricity rates may vary depending on your energy provider.
Every electricity and gas plan has two parts. The daily supply charge is, in Energy Made Easy's words, the cost of getting electricity or gas to your home even if you don't use any, and it is charged in cents per day. The usage charge is the cost of the energy you use, in cents per kilowatt hour for electricity. When you move in, your retailer may also charge a connection or move-in fee. Compare plans on the government's Energy Made Easy website (or Victorian Energy Compare in Victoria) once a year.
In addition to connection rates, you will also be charged for your electricity usage. It’s important to be mindful of your electricity usage to avoid high bills. You can reduce your electricity usage by using energy-efficient appliances and turning off lights and electronics when not in use.
As you can see there are ways to reduce your usage across different rates, fees and charges when it comes to the costs of running a home. I’m sure you can imagine what may happen if you accidentally left something on for a long period of time that you were unaware of.
It’s important to remember that not all properties have the same type of rates charged to their property. Every home pays council rates, water and electricity, but a home with no gas connection has no gas bill, because it runs on electricity alone.
Gas Rates and Gas Usage
If you do have gas, these are rates charged by your gas provider and are based on the amount of gas that you use. Some ways that gas is used are for heating, hot water, and cooking appliances such as stoves and ovens.
You can reduce your gas usage by using the most efficient appliances you can find (such as condensing boilers) and switching off any devices when not in use.
There are a number of things that you can do to reduce your gas usage and lower your bills. For example, you can install gas-efficient appliances and fixtures, reduce your overall gas usage by using a clothesline instead of a dryer, and turn off your gas heating when not in use. The same thing can be said about other services that are connected to your home. Phone Communication and Internet Services.
Thankfully we live in a day and age where some things are just not needed as they are not as commonly used as they use to be which means that there are ways to completely avoid unnecessary bills. How many people have landlines nowadays? Yes, you might have people who still have landlines but what if you don’t need it simply because no one calls you anymore on the landline?
We also live in a world today where we use internet services and have things connected like NBN, ADSL, Cable and Fibre, these kinds of services come with all sorts of fees and charges. So you would want to shop around and compare your options to ensure that you are getting the best deal both on quality as well as price as this is another expense that you would need to factor in.
Maintenance Costs Like Gardens and Lawns
Maintaining your gardens and lawns can be a significant expense for homeowners. It’s important to budget for these expenses and to be aware of the maintenance requirements for your property.
There are a number of things that you can do to reduce your gardening and lawn maintenance costs. For example, you can install low-maintenance plants and turf, use mulch to reduce water usage and compost your food scraps to reduce waste.
Pest Control and How to Prevent Infestations
Pest control is an important aspect of home maintenance. It’s important to be proactive in preventing infestations and to take action quickly if you notice any signs of pests.
There are a number of things that you can do to prevent pests from entering your property. These include sealing up any cracks or gaps in your walls and floors, keeping your property clean and tidy, and using natural pest control methods.
Home and contents insurance
Building insurance covers the house and contents insurance covers what is inside it. Lenders usually require building cover, and premiums depend on location, flood and bushfire risk, rebuild cost and excess. Get quotes on the address before you sign a contract, because a high premium can change whether a home is affordable.
In more detail, building insurance covers the house itself; contents insurance covers what is inside it. Lenders usually require building insurance on a house you borrow against. If you buy a unit or townhouse in a strata scheme, the owners corporation insures the building and you pay for it through your levies, so you may need contents cover. Premiums depend heavily on where the home is: flood, bushfire and cyclone risk, the rebuild cost and the excess you choose. Get quotes before you sign a contract, not after, because a high premium in a risk area can change whether the home is affordable.
Land tax: do you pay it on your home?
You generally do not pay land tax on the home you live in, because states such as NSW, Victoria and Queensland offer an exemption for your main home. Land tax usually applies when you also own an investment property, holiday home or vacant land above your state's threshold, so check your state revenue office for the rules.
Land tax is a state tax on the value of land you own, worked out each year. Your home is generally exempt. NSW Revenue says the property you own and live in most of the time may be eligible for the principal place of residence exemption, Victoria's State Revenue Office says your home may be exempt from land tax, and the Queensland Revenue Office lets you apply for an exemption for the home you live in. Land tax usually becomes a cost when you also own an investment property, a holiday home or vacant land above your state's threshold. Each state sets its own thresholds and rules, so check your state revenue office.
State levies on your rates notice
Some states add a levy to your council rates notice. In Victoria it is the Emergency Services and Volunteers Fund, a state government levy that helps fund emergency services, which councils collect for the state. Check a sample rates notice for the area you are buying in.
In more detail: In Victoria, the Emergency Services and Volunteers Fund is a Victorian Government levy shown on your rates notice that helps fund emergency services across the state; councils collect it on the government's behalf. Look for any state levy on a sample rates notice for the area before you buy.
Mortgage repayments and interest rates
For most owners the loan is the biggest cost. Your repayment depends on the loan size, interest rate, loan term and whether you pay principal and interest. The Reserve Bank cash rate target is 4.60% as at 28 October 2026, so compare lenders and review your loan every year or two.
In more detail: Your repayment depends on the loan size, the interest rate, the loan term and whether you pay principal and interest or pay interest alone for a set period. Your rate depends on things like your deposit (your loan-to-value ratio), whether you live in the home or rent it out, and the lender. Rates move with the Reserve Bank's cash rate; our guide to the September 2026 RBA rate rise explains what the latest change means for repayments.
Shop around. A mortgage broker compares many lenders for you and can ask your current lender for a better rate. Review your loan at least every year or two, and before any fixed rate ends. If you are still buying, read our guide to home loan pre-approval first.
How much to budget for home maintenance
A common rule of thumb is to set aside about 1% of the home's value each year for repairs and maintenance, and more for an older home, a pool or a large garden. There is no official figure, so keep the money in a separate sinking fund to cover surprises like a failed hot water system.
In more detail, the 1% figure is a guide only. Put it in a separate savings account (a sinking fund) so a hot water system, roof leak or broken fence does not land on a credit card. Regular jobs to plan for:
- Gutters and downpipes cleaned before storm and bushfire season.
- Termite and pest inspections, commonly once a year.
- Smoke alarms tested and replaced on time. In Queensland, all existing private homes, townhouses and units need interconnected photoelectric smoke alarms by 1 January 2027, and a seller must upgrade them before the home is transferred.
- Hot water system, air conditioner and appliance servicing.
- Garden, lawn and tree care.
- Painting, sealing and small repairs before they become big ones.
Your first-year cost checklist
- Ask the selling agent or council for the last rates and water notices for the property.
- Get insurance quotes on the address before you sign.
- For a unit or townhouse, read the strata report: levies, the sinking fund balance and any special levies coming.
- Get a building and pest inspection so you know what repairs are coming.
- Add up your repayments plus all of the costs above, monthly, and make sure you can still save.
- Keep a maintenance fund of at least a few months of costs.
More questions about the cost of owning a house
What is the daily supply charge on my electricity bill?
It is the cost of getting electricity or gas to your home, charged in cents per day even if you use none. It is separate from the usage charge for the energy you actually use. Compare both parts when you compare plans on Energy Made Easy.
What is the Emergency Services and Volunteers Fund on my rates notice?
In Victoria it is a state government levy shown on your council rates notice that helps fund emergency services. The council collects it for the state. Other states fund emergency services in different ways, so check a sample rates notice for the area you are buying in.
Do I need home and contents insurance?
Lenders usually require building insurance on a house they lend against, and it protects your biggest asset. Contents insurance is optional but covers your belongings. In a strata scheme the owners corporation insures the building, so you usually need contents cover.
What smoke alarms do Queensland homes need?
Queensland Fire Department says all existing private homes, townhouses, units and manufactured homes need interconnected photoelectric smoke alarms by 1 January 2027. When a home is sold, the seller must upgrade the alarms before the home is transferred.
What hidden costs come with buying a house?
Beyond the deposit, budget for stamp duty, conveyancing, building and pest inspections, loan fees, lenders mortgage insurance if your deposit is under 20%, moving and connection fees, and the first rates, water and insurance bills, which can arrive soon after settlement.
Is it cheaper to rent or to own?
It depends on the home, the rent you would pay instead and the interest rate. Owners pay rates, insurance and maintenance that renters do not, but they build equity. Compare the full monthly cost of owning, including every cost on this page, with the rent for a similar home.
How can a buyers agent help me with the cost of owning a house?
A buyers agent checks the rates, levies, strata records and condition of a home before you offer, so you know the ongoing costs as well as the price, and negotiates the price for you. Wealth Through Property's home buyers agent fee is a fixed $12,000 for homes up to $1 million, GST included.
Know the true cost before you buy
The cheapest home to buy can be the dearest home to own. Wealth Through Property's home buyers agent service checks the rates, levies, strata records, insurance risk and condition of a home before you make an offer, then negotiates the price. The fee is a fixed $12,000 for homes up to $1 million, then 0.4% on the part from $1 million to $2 million, GST included, with payment plans. Work out the fee for your price with the buyers agent fee calculator, or compare fees in our buyers agent fees guide.
Related reading: how to buy a home in Australia, first home buyer NSW guide and buying a strata property.
Sources
- Moneysmart: Buying a house (checked 28 October 2026), Reserve Bank of Australia: Cash rate target (checked 28 October 2026), Essential Services Commission: 2026-27 rate cap (18 May 2026)
- Local Government Association of SA: Council rates
- Ballina Shire Council (NSW): Rates explained
- City of Monash (Vic): How rates are calculated
- Energy Made Easy: Understanding gas and electricity charges
- Revenue NSW: Land tax exemptions (updated 28 July 2026), SRO Victoria: PPR exemption, Queensland Revenue Office: Land tax relief
- Queensland Fire Department: Smoke alarms (last updated 25 August 2026)
This article is general information and is not financial, tax or legal advice. Costs, rates and rules change; check with your council, insurer, lender and state revenue office before you buy.