Land: 10 reasons why it's not as easy as size & price

Who needs a house and land consultant? Just give me a price lists and the size of the house and I figure out myself which block works for me. I just add the price to the house price and that’s the cost, right? Wrong. There’s more to putting a House and Land Package together. Finding the right block of land to fit the budget and suit your needs entails more then just price and size. Here are 10 reasons why:

1. Site works. These are the things that need to be done before your concrete slab is pored. Generally this is a provisional sum, which means things can vary and the cost cited could change. Site works include things like earthworks; levelling out the block, scraping off any vegetation, getting rid of or adding sand, to re-peg the block (to make sure they put the house on the right spot), water run in, power run in, concrete pump hire and more. The costs of these works vary greatly from area to area or more accurately: it varies with different soil classes. Site works are cheapest when building on sand and expensive when building on clay. As an indication: we currently allow just over $10k for sand and just over $26k for clay. Then there are area’s that have sandy clay - you get the idea. If you have a block that is not level and work needs to be done to level it out and retaining walls need to be build; that could cost you even more. Which is why we recommend buying a block from a reputable developer: they will level the block, make sure there’s nothing unexpected in the ground and put in the retaining walls for you.

2. Fencing and Landscaping. Many developers offer fencing and landscaping included in the price. It’s worth keeping that into consideration as it can be a serious cost to have to pay for this yourself once you get the house.

3. Rebates. In a market where developers try to win the business, rebates are often offered. The reason they give rebates rather then taking the amount off the house price is that they don’t want the value of the blocks to go down. Effectively this is what happens of course, which is why banks don’t like rebates and if rebates are offered it does not show up on the paperwork of the block that goes to the bank. For you an extra 5 or 10k cash goes a long way in buying furniture or even paying for a lot of those repayments during the construction period.

4. Building guidelines.

As you need to look at the total cost of your package; if the building guidelines in the area state that you need to have certain elements in your elevation and your chosen design hasn’t; you will need to add these to get your building application approved later on. This means that you’ll have some variations that add to your total package price. A block might have a stipulation that it needs a house with a minimum amount of square meters of living area on it. If you have chosen a smaller house; you’ll have to choose a bigger one or add in area, which will be at a cost. Or if you have chosen a corner block, you’ll find that you might need to add some rendering on the secondary wall or even have to add in a window to satisfy the guidelines. All of which will add to your total package. There are many more guidelines to look at: garages might need to be behind the front wall of the home or can’t stick further forward then 1 meter. These guidelines might be enforced by the developer of the area or by the residential building codes (R-Codes) or there might be a Detailed Area Plan (DAP) applicable on your site, these are issued by the Shire. Quite a few things to check!

1. Bushfire Attack Level (BAL). If you find a block that is within a certain distance of any bushland, you will have to have your block assessed for BAL. BAL comes in a few different levels BAL12.5, BAL19, BAL29, BAL40. Depending on the level of risk, you will need to add a number of bushfire prevention measurements to your home. We allow just over $5700 for BAL12.5 and just over $11500 for BAL19 for example. Picking a block that doesn’t need these measurements can thus save you a fair bit of money. (You can read more about BAL here.)

2. Noise attenuation. If the block you chose is close to a noisy street, some of the guidelines could mean that you have to spend extra money to sound proof your house. This comes with an extra cost as well.

3. Titles and time for finance. Besides the cost aspect of the block, it is important to check if the block is already titled and if not, by when titles are expected. You can read more about titles here. If you need more time to save for your deposit or if you need time for your savings to become genuine or if you need to wait until you’ve been in your job long enough to satisfy the bank; it will be useful to find a developer that is willing to give you a long time between signing for the block and putting a small deposit down (subject to finance) and actually having to show finance approval. A standard time is 45 or 60 days, but if you need 90 days or even 100 days, it’s a conversation you want to have with the developer before you put pen to paper. Generally they are happy to do so if titles are not expected for a while anyway. The other way is true too; if you are ready now and want to build your house as soon as possible; you don’t want to sign up for a block which is not titled for 6 months. The further titles are out, the more uncertain it is that that date is accurate too.

4. Easements. This is generally not a huge factor as easements are often in places where you wouldn’t build anyway. It could be that along the edge of your block sewerage is dug in, so you can’t build on that edge. But it is something to take into consideration.

5. Front or rear loader. There are blocks where you have your garage and front door on the same side, the front. Then you also have blocks where you have access to the blocks from two sides; generally a laneway out the back where your garage needs to be. Buying a block like that if you don’t like rear loaders would be a silly thing to do.

6. Regional or Metro. If you are looking to go through Keystart and your income is too high for the Perth Metro area (read here about keystart areas), you will need to find a block in an area that is considered Regional.

In conclusion: besides looking at the location of a block (is it close to schools, shops, parks, public transport) and the orientation of the block (can the house have it’s living area’s and alfresco on the North-West side?) there are numerous things to keep in mind that could affect if a block is actually going to fit your budget. Lucky you’ve got a Consultant to look into those things for you!

#finance #housedesign #land