Starting off on your new home building journey is the beginning of a steep learning curve. There are a lot of regulations, processes and procedures that you will have to understand. The process to buy land is one of these. That’s why we are here to help clear everything up, providing you answers and explaining step by step how the land titling process works.
Land Titling 101
Purchasing land isn’t the same as purchasing anything else. It requires different parties and legal processes that you have to step through before you can start building your dream home.
Plainly stated land titling is the process where land is handed from the previous owner to you, the future owner. Each state and territory have their own register documenting who owns what land. This register also includes information about mortgages, covenants, caveats and easements.
Most typically land can be purchased in two ways. Either you buy land from a developer, or you purchase land through a private sale. Both have a slightly different purchasing process due to the fact that land from a developer has to be subdivided and registered.
The Titling Process
If you are purchasing land through a developer, the process to titled land for your dream home is slightly longer. However, with land in such high demand this is typically where most people acquire land these days.
- Firstly, you have to choose a lot of land that you wish to purchase. These are generally released in stages by the developer. You will need to put down a deposit (which is normally 10% of the purchase price) and sign the contract to secure your land.
- It is now time for the developer to organise the land so that it can be registered by the council. Developers will add in utility connections, street lights, roads and other facilities. Sometimes the time that your land will title can be postponed several months if there are delays with construction contractors. Obviously, this is not ideal but developers and sales agents will normally keep you well informed if delays are expected (sometimes for reasons outside of their control such as poor weather).
- Once this is complete it is then time for the council to register the land. If there have been delays in the previous stage, this will also be pushed back slightly. Be patient though, it will be worth it when you are moving into your dream home.
- After the council has registered the land, the developer can then inform you that your land is ready to be titled.
- You should seek legal advice from a solicitor or a conveyancer in this stage. A conveyancer like our friends at Titlexchange will help you transfer the land name from the developer to you.
- Once you have a set date for the land title to be transferred you can exchange contracts and the land is yours upon payment of the balance of the purchase price (typically the final 90%). This is a time to celebrate!
However, if you are buying land that has already been registered by the council through a private sale, you will not have to go through this entire process. Simply contact a solicitor or conveyancer and you are on your way to your dream home.
Land Titling Process Periods
With a boom in new home building over recent years there is high demand for land in many states, pushing the time it takes for land to be titled further back. Some of our clients have to wait between 12-18 months before they have transferred the title and are ready to build. This is not all bad news though. There are a lot of fantastic benefits of having to wait for your land to title. Although you have to wait to get into your dream home, making the right decision is important.
Benefits to time to titling
- It takes time to pick a builder and set yourself on a house design that you are in love with. You can use this time to properly explore the market and compare house designs.
- Builders typically have a slight waiting period from when you choose your house design to when they can start pouring the slab. Some builders simply have a high level of demand, but there is always going to be time needed to organise contracts, undertake soil testing and prepare the site. Having this organised before your land is titled is a fantastic option – it means they are ready to go when you are.
- Strapped for cash after buying your piece of Australia? You can use this time to save for the final land payment and the funds to start paying your builder.
- Another bonus is that builders can typically hold prices for 6-12 months, meaning your locking in a great price for your dream home, and with constructions costs constantly on the rise this can save you some real money.
- Same for your land. As demand increases and developers work to keep up, land prices only go up and land sizes only get smaller. Purchasing now means that you get your land at a competitive price and the value of it only starts going up! In many cases you will have earned some equity in the land even before it has been registered in your name.
Obviously waiting won’t always feel like a fun idea – with your dream home at the front of your mind, we are sure you are dying to get started, but for many it is the only option, and if you utilise your time right, it can really work to your advantage.
How Can iBuildNew Help
If you are looking to compare house designs and builders for your new land make sure you try our compare function on www.ibuildnew.com.au. It allows you to view features, facades, floor plans and inclusions side by side. If you prefer to talk to someone about your personal situation that is free and independent, give one of our expert consultants a call on 1800 184 284 or book a call online.