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BSB 805 050

What to consider before you buy land

Thinking of buying a land and building your new home? Key things to consider before you buy your new block of land.

30 Jun2020

Building a house is an exciting opportunity to create something entirely your own. From the location, to the size of the rooms and even down to the number of power points, the world is your oyster, as long as you have enough money and space. Blocks of land come in all shapes and sizes, inclines and orientations. So, before committing to your very own patch of dirt, there are few things to consider. We’ve put together a few of these considerations to help you on your search to buy land.

Council restrictions

Depending on the area you’re interested in there may be council restrictions which limit what you can build. More commonly these are zoning restrictions. Restrictions may be placed on what the land can be used for e.g. residential, commercial or industrial, the types of buildings that can be developed such as houses or apartments as well as restrictions on the dimensions and density of certain developments. You can find out if there are any zoning restrictions for a block of land you’re interested in by contacting the local council. Remember, restrictions in one suburb don’t necessarily mean they will apply to another.

Easements

In addition to council restrictions, find out from your real estate agent or the certificate of title if there are any easements that will affect the use of the land. Easements can give an individual (usually your neighbour) or a company the right to access part of your land for a certain purpose such as access to roads, common pathways or even access to pipes that exist underneath your land should they need to be repaired or replaced in the future.

Building costs

When it comes to building a house, understanding the costs involved will help you choose a block of land within your budget. Costs include the land purchase, architectural fees, building costs and government fees and charges.

Currently, the government is offering eligible owner-occupiers (including first home buyers) a grant of $25,000 to build or substantially renovate an existing home. The HomeBuilder grant will help cover some of the costs involved in building.  

Soil quality

Testing the quality of the soil is an important step to undertake before signing a contract for the purchase of land. When making an offer on a block of land you have the opportunity to specify that it is subject to a soil test. The results could drastically change the cost to build. By doing a soil test you could bring your negotiation skills to the table and save money on the purchase price or you could decide to withdraw from buying it all together.

Soil has the ability to move, expand and contract due to moisture. A soil test can indicate if conditions are present that might damage your house. More commonly it’s used to determine the stability of the soil which determines what foundations are required. The more unstable, the lower the foundations will need to go into ground. The deeper the builders need to dig; the deeper you’ll need to dig into your pockets.

Incline and orientation

Other factors to consider when buying land are the incline and orientation of the block. Blocks with a steep gradient offer a lot of appeal to buyers. Elevation usually means superior views and potentially more natural light however, it probably doesn’t come as a surprise that it’s harder to build on a block that is on an incline versus a flat piece of land.  If this is the case, you’ll need to be prepared to pay for the additional costs to build. You’ll also need to think about where any excess water will run off, particularly if you are building a house that slopes to the back. In any case, a builder will be able to discuss what is possible.

Another consideration is the orientation of your block and future home, particularly when it comes to the direction of the sun. In Australia, having a northerly rear aspect (in other words the back of the houses faces the North) is the most popular orientation. This is because it gets the most sunlight in Winter but also offers protection from the easterly and westerly sun. A home situated in the right direction might reduce the need for heating and cooling which means cheaper energy bills - win!

Block size/shape

Before you buy land, have a think about your family’s requirements and whether the size of the block will fit your desired space requirements. Will you have enough space for the three bedrooms, two bathrooms and big backyard you’ve always wanted? Have you considered both your current and future needs? The space may be perfect for now but if your family grows in the next few years it may start to get tight. Before committing to land, work out your ‘must haves’ and ‘nice to haves’ in a home and chat with a builder or architect about whether what you want will work.

Building a home can be a daunting experience but if you’ve considered all your options and planned beforehand, the process will be much easier. Do your research, seek expert advice and leave the hard work to the builders.


 

This article is intended to provide general information of an educational nature only. Any views expressed are the views of People’s Choice Credit Union solely. This information must not be relied on as a substitute for professional advice.


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