Building a house

[BENT_8]

So im after some tips on building a house in the near future, we've been checking out quite a few display villages lately and have found a house called the Vibe 3 by Distinctive Homes that ticks all the boxes.

This is our first build personally although we've been through a house and land package with our Son and in the process with our Daughter as i type this.
Both were off the plan developments where you pick a design, a site from a block of 6 or 8 that they have designated for that design and a choice of 3 colour schemes plus the option for certain upgrades.

For us it'll be different, do we approach the builder and ask about a house and land package, does that method require us to build where they already offer that package or can we decide on an area, a block that suits within that area and let them put it together or do we buy a block and then engage them to build seperately.
We dont want to go in without some insight.

Whats the financing process involved with each option, we'll be using Homestart due to lower start up costs to begin with and refinance at a later date.

What do you suggest?

[jaydee]

Usually with house and land packages you have to build on their land.
They buy up big swathes of land cheap, sit on it, then develop it by sub dividing into lots of little lots.
Pay attention to small print, the devil is in the detail.

[BENT_8]

Originally Posted by jaydee

Usually with house and land packages you have to build on their land.
They buy up big swathes of land cheap, sit on it, then develop it by sub dividing into lots of little lots.
Pay attention to small print, the devil is in the detail.

Thats what i thought too and then when i read some fine print on numerous house and land packages it actually stated that the builder didnt own the land advertised with it so im assuming its not theirs, nor does that house have to be with that block and that its more of a price guide than a set package as with what my kids have bought.

My Wife is on work cover and although she goes back to full time hours tomorrow the surgeon has said she'll never be 100% fit nor able to return to her original duties due to the nature of them and her injury so its looking like a career change in the medium future. Her current job is whats kept us living where we are but are both ready for a change of scenery so considering a move to the coastal country or river areas where house and land 'packages' seem few and far between.
The lure is the land, what we'd pay for under 400sq meters in our area we'd get 800sq in Murray Bridge etc.

[nstg8a]

Wee went through this when we built our house six years ago.

We ended buying the land ourselves, not through a traditional developer but through an older gentleman that was sub dividing his own big block to fund his retirement.

We paid $170000 for 818sq metres, at that time blocks in “developments” were roughly $180-200000 for a 450 ish sq metre block in the same suburb.

We then tracked down an builder that didn’t have a bunch of plans to choose from, but rather one that would design us the home we wanted, that would suit our block.

And in roughly two months time it’s getting bulldozed to make room for a primary school.

Finance wise we had two mortgages, one for the land, one for the house. But the bank treated it like one debt.

[BENT_8]

Originally Posted by nstg8a

Wee went through this when we built our house six years ago.

We ended buying the land ourselves, not through a traditional developer but through an older gentleman that was sub dividing his own big block to fund his retirement.

We paid $170000 for 818sq metres, at that time blocks in “developments” were roughly $180-200000 for a 450 ish sq metre block in the same suburb.

We then tracked down an builder that didn’t have a bunch of plans to choose from, but rather one that would design us the home we wanted, that would suit our block.

And in roughly two months time it’s getting bulldozed to make room for a primary school.

Finance wise we had two mortgages, one for the land, one for the house. But the bank treated it like one debt.

Cheers, thats exactly the first hand experience im looking for.
So if you dont mind me asking, you have enough deposit to satisfy the mortgage for the land and the bank draws up that mortgage, i assume you give them a time frame until you look to finance the build, how long did you wait?

Im thinking, and again im not sure if it can happen like this but i need less deposit up front to buy the land, then sit on it for 12 months and pour every spare dollar into it, use the equity as deposit for the build.

[LG17]

In reality you have to go with the option that suits you and your circumstances best.
I'd guarantee that everyone on here has used every option available to purchase their own home at some stage.

You have to research the options available to you and then go from there.

[naddis01]

Be prepared to be Bent over at the moment on building costs. We are going through this at the moment. We bought a block last year and in the time it took to get plans drawn up etc the cost to build has gone up 6 figures.

[BENT_8]

Originally Posted by naddis01

Be prepared to be Bent over at the moment on building costs. We are going through this at the moment. We bought a block last year and in the time it took to get plans drawn up etc the cost to build has gone up 6 figures.

Yes, as i mentioned in another thread the price difference between what my Son paid 18 months ago and what my Daughter is paying for an identical build now is 40k.
We wouldnt be looking to build until 2nd qtr of 2023 so that may see material costs normalise a little, i guess the advantage to buying land first and sitting on it is a smaller mortgage to begin with meaning more money on principal, less on intrest, building equity, and time to study the market.

Spoke briefly to the land agent my Daughter is dealing with about it and he confirmed what i thought, the days of builders buying swathes of land they develop and build on are over, the 'house and land' line is just a sales pitch and not the reality.
Using Homestarts calculator we'd be looking at around 14k deposit on a block worth 140k whereas for house and land together it would be around 40k on a 370k build.

I also like the idea of taking our time to own the land first, plan how the finished product will look, maintain the block, perhaps put up a shed and wait for the majority of other builds to be complete to let the dust settle, literally.
Im in Murray Bridge every day with work so keeping an eye on it and doing bits and pieces on my lunch break is no issue.

Having considered our plans with regards to living up there and maintaining our employment in the city initially and our start and finish times allow us to travel back and forth together keeping costs down until we land permanant jobs up that way, our Daughter will even get to stay in her current school.
Will add the best part of an hour to my before and after travel times but the majority is open freeway and i do it everyday for work now so the distance is nothing to me with an eye to it only being temporary anyway.
I have lots of contacts in the region due to my current job so shouldnt be too hard to get in somewhere.

[naddis01]

Originally Posted by BENT_8

Yes, as i mentioned in another thread the price difference between what my Son paid 18 months ago and what my Daughter is paying for an identical build now is 40k.
We wouldnt be looking to build until 2nd qtr of 2023 so that may see material costs normalise a little, i guess the advantage to buying land first and sitting on it is a smaller mortgage to begin with meaning more money on principal, less on intrest, building equity, and time to study the market.

Spoke briefly to the land agent my Daughter is dealing with about it and he confirmed what i thought, the days of builders buying swathes of land they develop and build on are over, the 'house and land' line is just a sales pitch and not the reality.
Using Homestarts calculator we'd be looking at around 14k deposit on a block worth 140k whereas for house and land together it would be around 40k on a 370k build.

I also like the idea of taking our time to own the land first, plan how the finished product will look, maintain the block, perhaps put up a shed and wait for the majority of other builds to be complete to let the dust settle, literally.
Im in Murray Bridge every day with work so keeping an eye on it and doing bits and pieces on my lunch break is no issue.

Having considered our plans with regards to living up there and maintaining our employment in the city initially and our start and finish times allow us to travel back and forth together keeping costs down until we land permanant jobs up that way, our Daughter will even get to stay in her current school.
Will add the best part of an hour to my before and after travel times but the majority is open freeway and i do it everyday for work now so the distance is nothing to me with an eye to it only being temporary anyway.
I have lots of contacts in the region due to my current job so shouldnt be too hard to get in somewhere.

Just check with your council if they will let you build the shed first. With ours they won't let you build a shed without at least having the house DA done.

[Citroënbender]

Would this be an ideal situation for an owner-builder? Being near the site five days a week or more, should help coordinate sub-trades.

And the council will possibly cut more slack on some aspects of a staged development; most approvals have three years currency with an option to extend. So your shed would be garage and temporary storage/site facilities, a perfectly legitimate reason to build it first.

[rare ss]

We built about 18 years ago.. we looked around at house and land packages and mortgage brokers all tried to funnel us into the "Keystart" deal which is the zero deposit bang all your fees onto the loan and pay interest on the lot

Found a great block of land that was being used for a carpark lot for the sales office which we put on hold while we looked at finance options, we put it on hold for 48hrs and got to shopping, titles for the block weren't issued for 8 months time so we only had to put down 1k to hold the block which was great as we had planned on not building right away as we were living at home for free and I was working away at the time so we had months to get the best deal for us

Ended up chatting direct one of the "big 4" bank and used our savings to get a loan for the block, now this chewed up our savings before we even got to the deposit however we managed to save the extra coin over the 8 months to get the deal down when titles were released and the block was ours

Part of the deal with the land was we had to build on the block within 2 years, so for 2 years we smashed all our savings on the loan and after 2 years we had enough paid off with the increase of the land value to refinance with the bank to increase the loan to build our house

Sorry for the spill, it was a fair process to get there but worked out well for us and we were on track to pay it off in 3 years but kids (twins!!) came along quite unplanned which put the brakes on that plan rather quickly!

Moral of the story is there's always more than one way to get what you want, trick is finding out what works for you and your situation