What you pay while you're building your brand new home

Buying land and building a home in NSW follows the following rough schedule and here’s what you can expect to pay as you’re building. (PS we have also formulated a brilliant quick look factsheet you can access from our members only section on the website - just jump into http://www.tworedshoes.com.au/building & click on members only to register for access.)

When you find the block:

Holding deposit to secure the block, either a flat fee – say $1000, or 0.25% of the purchase pric. Once you’ve paid this get the contract over to us and we’ll get full approval in place before you pay anything else.

Balance of the 5% or 10% deposit – and what we call “exchange”, generally 5-10 days after you sign the contract – and not before you have full loan approval!

Builder Initial deposit usually $500: To create initial tender & may also cover a site inspection – fixed price site costs and tender are very important!

Further deposit: Up to $5,000 to have the contract drawn up and professional plans done.

Council fees: Can crop up, DA (development approval) inspection and lodgement fees. These shouldn’t be more than $1,000 in total but can vary from council to council & your builder will have a really good idea of what you’re in for here if they’re building a lot in the area.

Knock down & rebuild: Can incur extra fees – lets talk about this separately, stuff like disconnecting gas mains etc. Just allow maybe an extra $1,000 – $3,000, if you don’t need to spend it – well and good.

Balance of the 5% build deposit when you accept the contract

And then we move over onto the regular progress payment schedule as per the contract.

Once you settle on the land: You’ll start paying interest only repayments for any loan you have for the land.

You’ll also be responsible for any land rates as they come due.

Once you start the build:

You may have to pay for temporary power and water to be connected, in most cases this isn’t a lot and in new estates the builder will probably have it in their tender

Interest on progress payments on the building loan:

Like the land loan you start making ‘interest only’ payments on the outstanding balance as you make each progress payment on the loan – progress payments are invoices the builder sends at each stage of the build – the interest bill grows as the build progresses until you’re all finished.

Article for The western weekender https://issuu.com/weekenderpenrith/docs/property27jan/32

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Two Red Shoes Copyright © 2020 All rights reserved. Call on 02 9002 0380, 0404 494 929, email us  or 'old school' fax 02 9002 0381

Jarrett Group Pty Ltd atf Jarrett Group Discretionary Trust trading as Two Red Shoes hold Australian Credit Licence No: 428614 and are members of an external dispute resolution scheme. Details of our complaint resolution process can be found here or please see our credit guide. All information contained on this site is general information only, and does not take into account your particular financial situation or needs. You should consider your personal objectives, financial situation along with the recommendations of your trusted advisors.

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  • NSW Central Coast too!