If you’ve decided to build your dream home from scratch, you might be considering a house and land package. It turns out more and more Australian home buyers and investors are exploring this option lately.
What is a house and land package?
The term ‘house and land package’ is used by home developers to describe a ‘package deal’ that includes both a new home and the land on which it’s built.
- Buy a block of land of your choice and then you choose from a selection of standard or customised home designs.
- A pre-built home completed on the developer’s land. Referred to as ‘turnkey’ packages, this means your home is ready for you to move in with all features.
The first option requires two home loans, one for the land and another for the construction of the house. One of the most significant advantages of buying this way is that you will only pay stamp duty on the purchase of the land, not the house. The other significant advantage is that usually, a construction loan is drawn down in stages of an agreed loan amount. This means you only pay the interest on the amount as you use it.
The second option is a bit more simple and straight-forward. The land and construction contract/loans are bundled together, granting the buyer a fixed price. Most home buyers choose this option due to the ease and convenience of the process. You also get to move into your brand new home without a lengthy waiting period.
Both types of house and land packages offer you a property that suits your needs and lifestyle. Also, with the new depreciation rules associated with investment properties house and land packages are a great investment decision.
But with so many house and land packages to choose to from, how do you make the right decision?
Firstly, make sure you research the builders, property-location, market prices, and narrow down your options. Once you have your short-list, check the credentials of the builder and ask the right questions to ensure you’re choosing the most reliable builder for the job.
Understand the pricing structure and obtain signed contracts for every change made to the original plan. Don’t assume what you see is what you get, clarity and contracts are often the most important elements of hassle-free home construction.
If you’re a first home builder, the Australian government offers the First Home Owner Grants (FHOG) which vary state to state. You may also be eligible for a stamp duty exemption or concession.
If you’re a home buyer looking for a straightforward process and quality build get in touch with our expert team at Lindona.
Read more about Lindona and our awesome projects to get started on your next home build.