House and Land vs Buying Established

This week our top Broker Tony Walsh was interviewed. The discussion was about the House and Land Package and Buying Established. As Tony have lived in Melbourne Victoria for over 35 years, he knows the Melbourne and Victorian market quite well.

In the below article, Tony gives some great pros and cons comparing securing either a house & land package or an established home.

What are some pros of buying house & land?

Once complete you’ll get a brand-new property.

You get to pick your own design and customize it during the contract stage.

No one has lived in the house before. You’re the first owner of the property.

You get warranty. You will usually get 12 months on everything and 7-15 years structural warranty depending on the builder.

Lower fees to get in (Stamps) and/or government grants available for first home buyers. Stamps is Stamp duty. Duty is calculated on a sliding scale. Starting at 1.4 per cent for properties valued at $25,000 and rising to 5.5 per cent for those valued at or above $960,000.

For a newly built property, this is the GST-inclusive price. The Stamp Duty Concession is up to $600K which would be $0 however, that would be $31,070

What are some cons of buying house & land?

Basic things are always not included like curtains, blinds and fly screens.

As it’s a brand-new property, often there are incremental costs for important house elements such as landscaping and driveways. If you are on a budget, it can be a little depressing as you have live with a back yard of dirt.

Depending on the builder there’s a high chance these aren’t included, adding $30K+ to the build.

House & Land developments are usually in new estates which are not where people want to live. It takes times for these areas to become more established.

What are some pros of buying an established home?

Usually these houses are in established areas with all shopping and lifestyle amenities available.

Depending on the age of the home and area, the land size is usually bigger.

You’re buying an established house. Thus, the home includes everything like driveways and landscaping.

If you’re buying an established home in an established area, you can expect growth in value to be faster. This is especially true if you’re closer to the CBD.

This could be handy if you intend on leveraging the growth for another investment property to build your portfolio.

Unless you’re a first home buyer, stamp duty will be calculated on the entire price.

What are some cons of buying an established home?

There is no FHOG (First Home Owners Grants) for first home buyers.

There is no warranty on the property.

Assuming you’re not renovating immediately, you will have to usually have to compromise or sacrifice on property features. For example, styles, layout and colours ect.

Usually buying an established home will be more expensive to buy.

Usually have more cost to outlay when you move in such as renovations and hidden repairs.

What are some mortgage expert tips to consider getting a house & land package?

There are so many grants available all the time. These can be for both first home buyers and non first home buyers as long as you’re buying an owner-occupied property to live in.

It’s always a good idea to check in with a broker about grants. We always keep up with what’s available at what time. We also know deadlines of when they expire.

A good broker will help with the entire process. This includes working with a conveyancer. Together we help pull everything together for settlement day.

Remember, for most people, you are not building your forever home (if that even exists) so it’s always good to compromise.

The only things that you shouldn’t compromise on is the Kitchen and Bathroom as this is what sells houses.

What are some mortgage expert tips to consider when buying an established home?

Know your limitations before going to action. Auctions are always unconditional. This means you don’t get to sign the contract with any conditions including finance. If you win the auction and you pay the deposit but then your finance doesn’t get approved, you will lose the deposit almost every single time. Even if you’re not going to auction, do not put in an offer without speaking to a broker or at least obtaining a pre-approval from your bank.

It’s amazing that people still do this. The amount of people that I have seen lose their deposit because of this.

What’s simpler out of house & land package and buying established?

House and Land can be easy to get into due to the stamp duty concession. What helps is the the fact that you can spread the deposits over the two different sections (land and construction).

Once the process is finalised, buying established usually means that you can move in and do nothing. Everything is usually done. If you go down the path of house and land, you will usually have other important projects to do after moving in. Such as concreting and landscaping.

What’s faster out of house & land package and buying established?

It’s faster to purchase a house and land package if you don’t have a lot of savings. It’s much usually easier to secure a house and land package compared to securing an established home.

When you buy an established home, you can move in straight after settlement. For both Owner Occupied and Investment, you can live in it straight away or, you can rent it out and start earning an income as soon as get tenants.

What’s better out of house & land package and buying established?

The best thing about buying a house and land is that you are basically choosing the house you want to build and live in. You get to build it the way you want within your budget and with your taste.

If you are buying an established house in a well-built area, your house will likely appreciate faster than purchasing a house and land in an outer suburb.

As a mortgage expert, what option is more dependable?

When it comes to dependability it’s very hard to answer. As you can see from the above, they both have their pros and cons and there is not a right or wrong answer.


For many homes owner and first-time buyers collectively, there will always be compromise when choosing either buying established or doing a house and land option.

In my time as a mortgage expert, I have heard positive and negative stories on both so ultimately it will come down to your individual budget. If you need assistance in further details to the above, please feel free to reach out below to discuss and figured the best option for you.

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