A house and land package is when a buyer secures a block of land and a home's construction in one process but two contracts. A house and land package is one of the most economical and efficient ways to expand your asset portfolio. The advantages of this asset class include the following.
Costs are clear
The price is normally pretty clear upfront for house and land packages. This is an important consideration for buyers whose finance is pre-approved and maybe on a tight budget.
Stamp duty savings
The biggest advantage of a land purchase and build package is the savings on stamp duty. You will only have to pay stamp duty on the land’s value as the house has yet to be built. On a typical house and land package of around $450,000, there will be a saving of about $8,000 in stamp duty.
Depreciation and tax benefits
The benefits of depreciation are significant in a new home. You can claim tax deductions for depreciable assets such as the construction cost of the building itself as well as its fixtures and fittings. A new investment home with a cost of $250,000, plus payment of rates, interest and rental management, can create a tax deduction of approximately $16,000 per year.
New homes attract better tenants.
As landlords, we all want to attract high-quality long-term tenants. New homes with modern finishes are beautiful to tenants, so they want to stay in for many years. New homes also benefit from charging premium rent so that you will gain higher returns for your investment.
benefits for both investment and owner-occupation
For investors, land purchase and building packages are new homes and can be warranted if there are quality issues. It will be easier to lease and likely to have few or no maintenance outlays. new properties depreciate faster than existing properties so that you can claim the maximum deprecation allowance on your tax return
First-time homebuyers may be eligible to receive the First Home Owners grant. Each state and territory varies, but there are several great incentives for first home buyers buying a house and land package.
Another great benefit of the house and land package is that it simplifies buying a home. From selecting a lot to applying for a building permit, from finding a designer to comparing builders, the building process can be long and time-consuming and cause unnecessary stress. By choosing a house and land package from a builder, you can simplify this process, get a fixed price, the right design, and start building right away until the house is delivered.
Take your now and future lifestyle attributes into consideration and weigh up the pros and cons of choosing a house and land package. If you think a package would suit your needs best, the next step is to compare house designs in an estate you like and choose a reputable builder. Integrity New Homes Melbourne East has many great designs readily available, so please browse our webpage to choose the right package or contact us for help.