Sep 16, 2021 11:28 am
I am trying to secure a block of land and engage a builder to build as soon as land titles (early next year). The land developer has sent me a contract and want to put a deposit of around $1500 and asking me to quickly sign it to secure this deal.
After doing more research I am coming to terms that this could have risks. I have shown the land to the builder and they have visited the site and they are saying "verbally" land looks good, soil is good, elevation is good, they can build on it.
But I have not got any contract with builder at this stage, and not even finalised house design.
I wanted to ask people is it normal to just sign the land contract (without having a builder contract - house specifications, etc.). Do people generally do it. Or it could be risky and I should take another approach?
As I have never built house earlier, so I wanted to get some ideas before I sign anywhere.
Re: Signing land contract without building contract2
Sep 16, 2021 11:55 am
Have a solicitor or conveyancer to look over the land contract. If you have concerns. Have a read if there any sunset clauses, what are the covenants for the estate, does the block have any easements or restrictions etc.
I have purchased both of my blocks of land first then done the build contract six months later. Both were titled land or land that was titling very soon. Terms were 5% deposit and the balance 30 days after tiltles are issued. This was off a Small local Land Developer in Regional Victoria. Unfortuantely, not many of them around now. All the big players have driven the small developers out it seems
Re: Signing land contract without building contract3
Sep 16, 2021 12:40 pm
In Western Australia it's normal to have the land before a builder, you do get house and land packages in WA but it then ties you in to a builder.
I wouldn't be signing with a builder until you have titles on the land. They will hit you up for a price rise anyway being that far off titles, I think you will find that builders will be looking for work next year as the home stimulus work dries up, prices of trades will decrease. Be careful also who you build with in WA, send me a PM if you want to discuss that further
Re: Signing land contract without building contract4
Sep 16, 2021 12:49 pm
We purchased land first, then picked the builders.
They are two independent contracts anyway. Unless you're buying house & land package, which means you're probably paying extra for the land.
Builders can build on any land, the question is how much it's going to cost you for the site costs and how many builders will agree to it.
Re: Signing land contract without building contract5
Sep 16, 2021 1:22 pm
As long as it's not a house & land package, you will be fine to purchase the land without a building contract. You will have the freedom to pick a builder with a plan and price you are happy with. Like others said above, just make sure you get someone to check the land properly for any building restrictions before you buy it.
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