For all those who were confused with the whole House and Land Package thing. Hope it helps!
This source was found in the Wizard Home Loans website:
http://www.wizard.com.au/homeloans/task.aspx?id=3
1. Developers usually offer two different packages. The first involves you purchasing the land from the developer before they build the house. The second option sees the developers build the house on their own land, which you purchase once construction is completed.
2. Buying the land from the developer prior to construction will mean that you pay a deposit on the land (usually 10% of the purchase price). The balance of the land's value is to be paid upon settlement, after which the builder will commence construction.
3. Under this type of package you will need two different loans - a land loan and a building loan. The advantage to this arrangement is that stamp duty is not payable on the cost of building the house (only on the value of the undeveloped land).
4. During the course of constructing your home you will be required to make progress payments. These payments will be made at various stages of the construction, e.g. when the framework is erected, after brickwork and tiling is completed and at lock-up stage.
5. If, however, you choose to have the developer build on their own land, you will usually be required to pay a deposit of 5% before building begins. There are no progress payments; with the balance being due once construction is complete.
6. This approach allows you to defer payments until the house has been built, an especially attractive option if you need to continue paying rent until this time.
7. However, this package will be more expensive overall, as you must pay stamp duty on both the house and the land. Also, the developer is likely to increase the total purchase price to compensate for the interest costs incurred by purchasing the land and building materials.