What to look for when buying a house and land package. Buying a standalone home on a nice block of land can be a great investment. Purchasing a full turn-key is among the most ideal ways to buy as its a fully inclusive purchase that is generally offered on a fixed priced contract. In this market insight we highlight five common items to consider in advance before you begin.
What is a house and land package?
A house and land package is when a buyer purchases a block of land and a house in one transaction. These are most commonly sought after in new land estates and are available all over Australia. These are often transacted in two separate contracts as follows:
- A contract is executed for the land purchase
- A contract is executed with the nominated builder
Both contracts are essentially bundled together as one transaction, being a house and land package.
Five common items to consider when buying a house and land package
1. Is the package within your overall budget? A full turn-key house and land package is often a fixed price allowing you to identify if it’s feasible and within your budget. Keeping your budget in mind throughout the buying process is imperative. You can easily get stuck into an impulse buying spree once you see what custom features you have at your disposal in comparison to buying a second hand home that is ‘what you see, is what you get’. It is also important to note, a buyer generally requires a 5% deposit for the build price and a 10% deposit for the land value. For example, a build price of $350,000 and a land value of $350,000 would mean you’d need to fund $17,500 for the build and $35,000 for the land. Totalling a collective deposit of $52,500 for a $700,000 house and land package.
2. What is excluded from the package? As mentioned earlier in this market insight, a full turn solution is ideal as it is an all-inclusive build, however, you still need to be aware of the inclusions and exclusions. Some builds may provide a split system in the living area only, while others may provide evaporative cooling throughout. A floor plan may offer larger kitchen appliances or another build may not include an alfresco. Selecting the right builder is very important. Employing a buyers agent, such as ourselves at Crest Property Investments will ensure you are in safe hands. Most new builds will provide some flexibility to alter a floor plan to cater your personal needs. Communicating this upfront will ensure you make a great purchase.
3. What land estate do you want to buy? A master planned community is a residential land estate designed for families to live and raise their families. They often feature a number of different sized allotments with recreational areas such as parks and reserves and retail amenities including shops and supermarkets. Many master planned communities have wetlands, pathways and other outdoor facilities such as playgrounds and running tracks.
4. Understanding the block of land Not all blocks were made equal. It may be a corner block, it may include an easement or rock. The land allotment may feature a slope from side to side or from front to back. Obviously the flatter the block, the cheaper the build given the site costs and preparation required to build a home on it. The land can really dictate the build so its really important you understand the block. A cheaper block of land doesn’t necessarily make it a bargain!
5. Choosing the right builder Choosing the right builder is more than just a price comparison. Is it for investment purposes or to occupy? Regardless of the purpose, how do you choose the right builder is critical to gaining longevity, low maintenance and a well-presented property. Set yourself a list of objectives that you are looking for in a build. Understanding your needs within a build is half the battle.
What to do next?
In conclusion, obtain qualified advice from a property adviser. To choose the right house and land package, a property adviser can help create your list of objectives, refine your search and present some opportunities to review.
If you’d like to learn more about building a custom home, please don’t hesitate to contact us. We would welcome the opportunity to help with your property purchase.
Our YouTube channel and Market Insights also provide a wealth of information to assist you with many areas relating to property.
While we have taken care to ensure the information above is true and correct at the time of publication, changes in circumstances and legislation after the displayed date may impact the accuracy of this article. If you want to learn more please contact us. We welcome the opportunity to assist you.
September 2023
