So you’re thinking about building a new home from scratch. It’s a tantalising prospect for sure. Finally being able to have the master bedroom you’ve always wanted, or the MasterChef-inspired kitchen you’ve been longing for – it’s the stuff of dreams. But make no mistake, new build homes are no small task. Between finding suitable land for sale, choosing the right builder and getting a construction loan – the process is very different to buying an existing home.
In light of this, it’s imperative that those looking to take on a home building project of their own be well across what’s involved. In this article, we outline the most important questions home buyers should ask themselves when looking to build the home of their dreams.
1. What Kind Of New Build Home Do I Want?
Depending on how much freedom you want with your new build in terms of design, you may opt for either a project builder or a custom home builder. The former offers pre-designed house and land packages, though still with some nice flexibility when it comes to floor plans and upgrades like air-conditioning. The latter grants you total creative liberty to design your home just as you envision it.
2. How Do I Choose The Right Builder?
Picking the right builder very often starts with asking yourself: what style of home do I want? It’s no use hiring someone who specialises in traditional when you’re after something modern..
Check they have a home builders license and all the necessary insurance policies to cover the various stages of construction. Delve into their history of experience and industry reputation. Looking at previous builds and reading reviews will give you a good insight into how reliable they really are. This is where iBuildNew can help. We’ve done all the leg work for you as we partner with experienced builders that we match with your design needs.
3. What Are The Pros Of Building From Scratch?
Designing your dream home is without a doubt one of the best aspects of building a new home.. But there are some other upsides you might not have considered. Not having to worry about repairs and maintenance for a while is a plus, since you won’t be buying a property that has seen its fair share of wear and tear. Then there’s the opportunity to enjoy all the eco-friendly features. Energy-saving cooling and heating, solar panels, LED lighting, rainwater tanks – all things you can incorporate to make your new home greener, more efficient and save on the utility bills at the same time.
4. What Are The Cons Of Building From Scratch?
If you’re planning to take out a construction loan for your new build, like many do, then expect to work to building deadlines set by your lender. Usually banks give you 12 months to commence construction from when you receive the mortgage contract, and 24 months to complete it from this same date. Hidden extra costs and delays are definitely something to watch out for (more on that later). Last but not least there’s always the possibility of running over budget for one reason or another – poor site management, design errors or mid-way modifications to the house plans can prove costly.
5. What Is A Building Contract?
Once you’ve had a good look at the home builders out there and landed on one that seems just right, there’s the little matter of the building contract. This legal document provides the full rundown of both your and your builder’s rights and responsibilities. Expect it to cover details like the nature of the work, cost, compliance with national building codes and standards, construction delay contingencies, termination clauses, progress payment schedule and the provision of a 5 day cooling off period, among other things. Having your conveyancer review the contract before you sign is highly recommended.
6. Are There Any Perks For First Home Buyers?
Yes! While the specific rules and eligibility criteria differ between states and territories, it’s entirely possible for a first home buyer to be on the receiving end of a very helpful financial boost when building from scratch. For one, there are first home owner grants between $10,000 and $30,000 available to those who build a new home valued up to a set amount. Then there are concessions, if not an outright exemption, to paying stamp duty when purchasing vacant land with the intention to build your first home on it. On top of this, the Federal government’s 2022 budget has also given a leg up to first home buyers by expanding the Home Loan Guarantee Scheme across Australia. Under the program, thousands more eligible buyers entering the market with a view to build or buy a new home will now be able to apply for a loan with a deposit as low as 5%.
7. What Hidden Costs Are There?
Say you’ve just purchased a premium block of land for your new build – you still have to prepare the plot. This is where site costs come in. Excavation, piering, soil testing, and connecting power, water and sewerage are all necessities that need to be included in your cost estimate. And when building kicks in, there are also some extras that don’t typically fall within your builder’s purview. Things like flooring, driveways, landscaping, and temporary site requirements like portable toilets and fencing will have to be factored into your budget. Building on a slope? Then prepare to pay a bit extra.