The pros and cons of a house and land package.

You’ve probably seen the advertisements for cheap house and land packages. They’re normally offered by big developers who buy up large tracts of land, add the necessary infrastructure like roads and utilities, and then release individual lots to the market as either completed home and land packages or vacant land for buyers to build on.

No matter whether you opt for the complete package or settle for vacant land, the big plus is that at some stage you’ll have a sparkly, shiny, new home. But there are pros and cons to consider with both strategies.

Let’s look at the pros first.

House and land package – what you see is what you get.

House and land packages can offer a ‘turnkey’ deal with all the bells and whistles including fully landscaped gardens, driveways, paths, even a clothesline. As the house is designed with the block of land in mind, there are no complicated construction decisions to make.

This means you won’t be left scratching your head trying to figure out where your back patio needs to sit for the perfect afternoon aperitivo. What’s more, interiors are painted and floor coverings like carpets and tiles are put in place.

You also know exactly what you’re buying. You can see whether the dining room is large enough to accommodate your furniture, and you know exactly what the bedroom windows look out onto. It takes the guesswork out of how your home will look and feel, so when you take possession of the property you can dive straight into the business of settling into your new home and exploring the neighbourhood.

You can make your house green.

Another benefit is that new house and land packages are often built with sustainable materials. As the construction industry becomes more and more environmentally conscious, so do the houses that are built.

Less maintenance.

When you buy a new car, you can confidently walk out of the showroom knowing that the vehicle is in tip-top condition and won’t burn a hole in your wallet at the mechanic. The same applies for a house and land package.

You can rest assured that your brand new house is not going to require a major amount of work anytime soon. Less maintenance and upkeep means more time for fun stuff, like deciding where to put your limited edition Star Wars replica light sabre collection.


And now, time for the cons.

Modifications on completed house and land packages can be costly.

Along with the benefits, there can be downsides to buying a completed house and land package. If you want to make significant improvements like, say, adding a backyard swimming pool, it can be expensive to accommodate major changes to a completed dwelling.

You may also have limited opportunities to customise your home to your preferences. Minor issues like changing the interior paint colour are relatively easy to sort out. However, re-tiling the bathroom to suit your taste can add to the cost of your home. If there are many items you’d like to change, it can pay to think about option number two – buying land now and building when you’re ready.

Buying a block of land and building later.

Plenty of new estates feature vacant lots for sale, or you may come across an in-fill site in a more established suburb. Either way, buying land and building a house later provides the opportunity to construct a home that accurately reflects your tastes, preferences, and lifestyle. This option can also provide savings on stamp duty as you’ll pay duty on the value of vacant land only, which is likely to be far less than for a completed house and land package.

On the one hand, buying land first and building later provides more time to save funds for your home’s construction. Although, if you are currently renting, it can be a financial juggle to cover rent payments while also managing the repayments on a land loan.

Be aware too, master-planned estates often have design restrictions in place to help create a cohesive overall impression. It can mean you are restricted to a choice of builders and designs, and while minor modifications in key home designs may be fine, anything that’s wildly out of sync with the overall look and feel of the estate may not pass muster.

Stamp duty on house and land packages.

On the plus side, some state and territory governments offer incentives to new home builders and buyers, typically in the form of stamp duty concessions. Your ME Bank Mobile Bank Manager can let you know whether potential stamp duty savings are available for your circumstances.
This is also a good opportunity to discuss loan finance. A traditional mortgage may be suitable if you buy a home and land package, but if you’re building a home from scratch, a loan for the land and separate construction loan is likely to be better suited to your needs. Your ME Bank Mobile Bank Manager can help here too, with expert advice on the loan finance that works best for your needs.