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What should I ask when buying a block of land?

Buying your dream parcel of land can be the first exciting step to owning a brand-new home. But it can also be a daunting process, especially if it’s a road you haven’t traversed before.

If community and liveability are important to your lifestyle, buying into a new masterplanned community can make good sense.

New estates offer options for all sorts of buyers from first home buyers looking to get a foot on the property ladder, to families seeking more room to move for their brood; to downsizers wanting less maintenance and more fun. Living in a masterplanned community also has its benefits, from being close to new amenities such as parks, schools and shops, to having access to a range of transport options and the chance to get involved in a range of local community events.

So, here are some questions you might want to ask to help you to make the best, most well-informed decision you can when buying a block of land.

How important is location when buying a block of land?

The old saying ‘location, location, location’ should be a key consideration for all real estate purchases – not just when buying an established home, but when you’re looking to make a land purchase too.

Think about the precise location and orientation of the block and how this fits in with your lifestyle and the sort of home you plan to build.

It’s also worth scouting the proximity to green space, playgrounds, schools and public transport to see how these meet your requirements.

Making a sound decision about the location will improve liveability of your new home in the years to come and how content you will be in your new neighbourhood.

Who is the land developer?

Doing your homework on the land developer’s background and their reputation will give you peace of mind when you’re embarking a potential land purchase.

As Australia’s largest, privately-owned developer, Satterley is a known and trusted leader in the house and land development sector, having planned and created more than 170 communities over 40 years. We are proud to have played a part in helping to more than 250,000 people realise the Great Australian Dream of homeownership.

Do I need to conduct a land assessment?

Before you even consider signing up to buy a block land, it’s important to conduct due diligence when it comes to the lot you’re about to invest in.

As a buyer, you should undertake adequate research to consider the land size, drainage and position before committing to any land purchase.

It’s a good idea to visit the site in person, if possible, and to contact the local council or shire to determine the development application process and if there may be any restrictions on development of the land. This might include any restrictions on the percentage of land that can be occupied by a building as this might influence any design ideas for your new home.

It's also worth checking whether infrastructure and utilities are in place. Is there access to water, electricity and sewage?

What is the property zoning and what are the permitted uses for the land?

The land zoning will determine what you can build and how you can use the block so it’s important to be clear about all relevant permissions before building on your site.

Consider whether there are height restrictions or if special applications may need to be made to run a business from the property or if you would like to have a chicken coop.

The developer and local council should be able to answer these questions for you.

What can I expect to pay in stamp duty? Are there any tax exemptions if I buy this land?

In most Australian states and territories, stamp duty is calculated on a sliding scale dependent on your property price. Essentially, the cheaper your property, the less stamp duty you will pay but the thresholds do vary from state-to-state.

As well as the state you’re buying in, the total amount of stamp duty will depend on the purchase price and whether you’re a first homebuyer, owner occupier or investor. Whether the property is a primary residence or an investment may also affect stamp duty.

What can I expect to pay in stamp duty? Are there any tax exemptions if I buy this land?

In most Australian states and territories, stamp duty is calculated on a sliding scale dependent on your property price. Essentially, the cheaper your property, the less stamp duty you will pay but the thresholds do vary from state-to-state.

As well as the state you’re buying in, the total amount of stamp duty will depend on the purchase price and whether you’re a first homebuyer, owner occupier or investor. Whether the property is a primary residence or an investment may also affect stamp duty.

What is the community like?

If you’re looking for the right place to lay down your roots, you will need to consider your lifestyle and how different estates might meet your requirements.

If you’re a young family, you may want to be close to schools, parks and playgrounds or if you’re a city worker, being close to public transport and train services may take precedence.

Satterley makes it a priority to foster a genuine sense of community across all of our estates, paying particular attention to thoughtful design and how the estate will contribute to the lifestyles of the residents who live there.

This includes having plenty of green space to ensure peak health and wellbeing, recreation spaces, unique playgrounds and community facilities that cater for all ages and all types of buyers.

Does the price of this land meet my budget?

Many homebuyers are attracted to buying into a new land development because it presents a more affordable option to getting a foothold onto the property ladder, with the added benefits of newer amenities and thoughtful, considered design.

New estates generally offer a range of lots to meet a variety of budgets and may mean that you’re able to build the exact home you want for a cheaper price than buying established.

This could potentially result in greater long-term capital growth benefits as your parcel of land appreciates over time at a better rate.

There are also a number of government incentives, such as stamp duty concessions for first homebuyers, that may make buying into a new land development even more affordable, depending on your circumstances.

Crunching the numbers before you commit to a land purchase will help you to ensure you’re not overstepping your budget.

Should I consider future growth in values as part of my planning?

Absolutely! We all need a roof over our heads, but it’s also important to recognise this will be one of the biggest investments you are likely to make in your lifetime. Therefore, considering the potential for future price growth and your financial position is crucial when it comes to the block of land and location you’re looking to buy in.

For example, bigger blocks or sites with waterfront views might cost more initially, but the additional price tag might be worth it if you think it will appreciate more than other blocks nearby, particularly if you decide to sell in the future.

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