Is it compulsory to start construction within certain time?

kanchi7880 · May 14, 2007 12:42 pm

Hi All,

If I purchase a block of land today, is it compulsory to start a construction within certain time i.e. 1 year or 1.5 years??

Last weekend when I visited The Chase @ Berwick, a construction company told me that if you purchase a block of land here, you have to start a construction within 12 months...

Who generally decide that? Can’t I leave my block of land w/o construction for 2 - 3 years, just for investment?

Thanks, KanChi

mattwalker · May 14, 2007 12:47 pm

Hi Kanchi,

Usually the developer puts it in as a covenant.

You don't have to build if you don't want to, but you may miss out on some incentives from the developer etc...

The reason they state this is so they can sell the next stage/release of the development with no vacancies in the old stages....

Matt

kanchi7880 · May 14, 2007 12:59 pm

mattwalker

Hi Kanchi,

Usually the developer puts it in as a covenant.

You don't have to build if you don't want to, but you may miss out on some incentives from the developer etc...

The reason they state this is so they can sell the next stage/release of the development with no vacancies in the old stages....

Matt

Hi Matt,

Does they enforce me if I dont want to build my home within time period they specified ?

And why they release block of land in different stage ? any there any difference in quality of land in each release ?

Regards, KanChi

mattwalker · May 14, 2007 1:07 pm

Kanchi,

They may try to enforce it, but generally they don't bother...

The reasons they "stage" developments are varied, but they do have different gradings of area's.

If you have a look at the development of the chase

http://www.thechase.com.au/development.html

you will see there are several different stages there now.

There is also a new development starting on O'Shea road closer to the shopping village too which might be worth a look!

Matt

lrhodes1 · May 15, 2007 4:45 pm

There are no such covenants if you buy a regular block of land outside of a big new subdivision.

I got my block when someone chopped their big block in half.

You can search for land like that on Realestate.com.au under land for sale.

Cheers

Firthy_26 · May 24, 2007 5:37 pm

Hi KanChi,

We also have a block of land in the Chase estate in Berwick. Bought it over 2 years ago & were told at the time that we had to build, or submit plans within 12 months. Only now are we just starting to build on it & we have heard nothing in the mean time to say "Build or else". There was nothing in the contract that I can remeber about having to build in the first 12 months, it was just a verbal by the sales person. Also, what can they do, legally, if you don't build on it if there is nothing in the contract.

Cheers,
Mike.

First_Timer_Ray · May 24, 2007 6:17 pm

Hmmm, interesting. I don't see how they could make you build on the land. What if you don't have the finances at that point? What are they going to do? Take you to court and make you sell the land?

Ray.

ahuang · Jun 01, 2007 1:55 pm

Be careful, you also have to consider council approval process as well.

1. From council side, normally there's an expiry date. For our council it's 5 years. After that you have to re-apply for approval,

2. From builder side, depends on which stage you are in:
A. If you haven't sign any contract, you can delay as long as you like, but project home builders normally adjust the price every 2 to 4 months. The price is only fixed when you sign the contract.
You can also walk away, but the design and drawings are their intellectual property, my understandings is unless you get it in writing, project home builders won't allow you to use their drawings to build with someone else. If you got it from some Architect, you won't have this problem.

B. If you signed the contract, depending on the contract details, normally you need to start within a few months after council approval.

Hope this helps.

Cheers
Allan
http://building-our-first-house.blogspot.com/