🧠 House and land packages – everything you need to know

House and land packages are a growing segment in the property market and a popular way for Australians to enter the housing market. However, it can be challenging to understand whether this type of property is right for you and your pretty goals and circumstance. On this episode, Buyer’s Agents Pete Wargent and Amy Lunardi will discuss what you should consider and deep dive into the pros and cons of house and land packages from purchasing your own home to investments.

On this episode of the Australian Property Podcast:

• How to define a house and land package
• House and land packages – your home versus an investment

If you are buying your home: 

Pros 

• Cheaper option
• Brand new, more accommodation
• Lock in land price now, build later
• Less stamp duty
• Making changes to design/customisation
• FHOG

Drawbacks

• Lifestyle: Amenity, distance from CBD
• Finance risk: delays to title, land value goes down, circumstances changing, build cost goes up
• Unexpected costs
• Builder risk
• Lengthy delays

If you are an investor: 

Benefits. Why do people invest in properties that aren’t built yet?

• Depreciation benefits from a new property
• Easier to rent out
• May make some capital gain if the land and build cost is less than the final value

Drawbacks: 

• Also, less scarcity, fewer amenities

Considerations when thinking about purchasing a house and land package

• Where to start
• Location? Fringe greenfield estates? Almost by definition, H&L packages are often in locations which are being developed and where land isn’t scarce. Walkability to amenities, transport, cafes, restaurants etc.?
• How long will it take? Current rates are up to 24 months. On average 22 months per PropTrack data.
• Is the developer reputable? Insolvencies in the construction / developer industry are currently rather high
• Is it a fixed price? What are the risks of overruns and hidden extras?
• How will you finance the deal?
• Is it safer simply to buy an established property?
• Are there incentives for investing in a new property? Stamp duty exemptions etc. First homebuyer gents etc.
• Rules and regulations for building and approvals needed