Is a house and land package good value for money?

Have you always imagined yourself with oak floors, not walnut? A walk-in wardrobe with shelving units just because? An ensuite with nooks for all your weird frog figurines? Whatever your preferences, you want your house to be just right for you.

House and land packages can be a great option for first-home buyers: competitive prices, tax savings and the chance to customise the way things look. Plus, with land in inner suburbs becoming more scarce, new estates can offer development space the city never will.

But, as with any home, there are pros and cons to a house and land package. Follow our tips for making an informed choice.

Everything is new.

House and land packages are like a freshly-ironed shirt: everything is neat, all the lines are straight and it smells a bit like when your mum does your washing. But there are benefits beyond the aesthetics. Newly-built homes tend to be more energy efficient and, when you choose a reputable builder, may not need repairs for many years. In fact, the home will be covered by a builder’s warranty, meaning you’re protected if anything goes wrong.

Your surrounds might also be new. Many house and land packages are located in master-planned estates where everything is deliberately designed for the new community. Your brand-new bedroom window might overlook a brand-new supermarket and a brand-new bike track and a brand-new pond with lots of brand-new ducks.

You might be eligible for stamp duty tax deductions and other savings.

Besides savings on list price and ongoing maintenance, house and land packages can come with tax benefits. Before the house is built, stamp duty is only payable on the land component – not house and land combined – so you can save by buying off-the-plan.

To further sweeten the deal and entice first home buyers to house and land packages, many state governments now restrict stamp duty concessions and first home owner grants to those who build or buy a newly-constructed home.

Some developers even offer rent-to-buy house and land packages, for buyers who want in to the market but can’t front the whole deposit right away.

You’ll probably get to know your neighbours really, really well.

We interrupt your fantasy stroll down your new hallway to bring you this reality check. A house and land package might offer good value and the freedom of choice. There are floorplans to suit almost any situation and finishes to make you feel like royalty.

But there can be downsides. New estates tend to have smaller lot sizes than established areas. A low-maintenance garden or courtyard could be perfect for you now, but will it still work if you get a rescue greyhound or several children?

Consider the location, too. New estates are often constructed in outer-ring suburbs, where employment opportunities and public transport may be harder to come by. Saving money on your new house is great, but not if those savings are eaten up by expensive commutes or salary cuts.

Be clear about what’s included.

The idea of a ‘turnkey’ property is definitely appealing, but make sure you know what’s actually included. Many builders charge extra for things you might not have considered, like fences, landscaping and pathways.

Make yourself familiar with some of the less obvious inclusions, too. New builds typically cut costs with lower ceilings or lesser-quality fittings. The difference between 2400mm and 2700mm ceilings doesn’t sound like much, but it’s basically impossible to change once your house is built. Visit plenty of display homes to see the specifications in action.

Everything will take a little bit longer.

Building a home can be a lengthy and stressful process. Choosing backsplashes and soft carpets and a synchronised Christmas light display might sound fun now, but each decision takes time. Even after you move in, you’ll need to wait for plants to grow, other families to arrive and perhaps even for amenities to be built.

Property values in outer-suburban areas can appreciate more slowly than in urban locations, too. It’s especially an issue in large developments where space is plentiful and supply outstrips demand. Slower capital growth could impact your ability to move house again or climb the property ladder quickly.

Unlike buying an established home, a house and land package off the plan requires a bit of imagination and a dose of good faith. It can be hard to know exactly what you’ll get when it’s time to pick up the keys.

Weigh up the options with your eyes wide open. If a brand-new home built just to your tastes still feels right, go forth and research. As you would with any purchase, make sure you fully understand the terms of your contract and know exactly what’s included.