Aug 24, 2021
House And Land Packages: How To Get Your Finance Sorted
A house and land package refers to a deal where you get a new house on a vacant block you have either bought in the location of your choice, or on housing estates or land developments. This is different to buying an established property. With either standard or turnkey packages you have the option of choosing your favourite location, and building your house exactly the way you want.
How Does Financing Land Packages Work?
If you are planning on building, always shop around to find the best deal on a home loan. It’s not hard to finance a package, it’s just different to financing the purchase of an already established home.
Financing your build begins with finding the block you want and securing a loan for that, then securing the loan for the build. Try to get a good deal from one lender as you will pay interest. Some banks and lenders will bundle both the home loan and the block loan.
More about the stages:
- Buying the vacant land: You can buy with a mortgage registered against the land’s title.
- The construction loan: You will require more finance to build. With a construction loan, you can draw down payments for the main stages of the construction process according to the building contract. Construction loans are normally interest-only home loans, meaning interest is only paid on the progress payments drawn down from the loan amount.
Once your home is built and your builder has received the final payment, your bank may allow you to combine both borrowings into one full mortgage. This is general advice only.
What hidden costs do I have to consider?
There could be extra costs so as a home buyer always ask your builder precisely what is included. You might find landscaping, flooring and fencing may not be included in the quote. Also, some lenders might only begin to borrow money from your loan for your build when they’re sure your deposit has been used to pay off all the first stage invoices.
Are House & Land Packages a Good Investment?
Yes, a package deal is one of the best investments available in the property market in Australia right now. There’s a huge amount of interest, especially with Federal and most State Governments offering many benefits to owner-occupier buyers with generous grants and stamp duty exemptions.
Are There Any Grants for First Time Buyers/Builders in Victoria?
Yes, Victoria does have a First Home Owners’ Grant which offers $10,000 when you build or buy your very first home and $20,000 if you build in regional areas, depending on your eligibility criteria. With these grants, you can save even more money by opting for a house and land package rather than buying an existing property to climb up the property ladder.
At Aston Homes, you not only get a quality build and a simplified process compared to most, but you also will end up with a fabulous new dream home that includes front landscaping, concrete driveway, stone benchtops, quality floor coverings, 900mm kitchen appliances, brick infills, 2550mm high ceilings and so much more at no extra cost.
Call us today on 1300 616 204 or use the convenient online form.