Aug 05, 2013 4:22 pm
Hi all, first time poster here.
My wife and I are considering building a house in our new town in Country NSW. We have saved $30K deposit and are looking at a house and land package price of $290K (land price is only $65K).
We never thought building was an option, however the extra $15K FHOG and stamp duty concessions are tempting us into building. We can comfortably afford repayments on the loan (less than we currently pay in rent) and am wondering whether it would be best to try and borrow $15K off family to reduce the overall loan amount (pay them back when FHOG is paid) or just borrow an extra $15K and pay it straight off the loan upon completion of build and payment of FHOG.
Will there be much of a difference in repayments etc, obviously we will be paying interest on extra $15k until FHOG is paid, however we would prefer not to have to borrow this cash off family.
Any advice would be much appreciated.
Re: First time builders - FHOG2
Aug 05, 2013 9:59 pm
FHOG can be included in your deposit if done properly, and will just get paid straight towards the build when it comes through - typically after slab down in NSW.
Where abouts are you looking to build and which builder?
Re: First time builders - FHOG3
Aug 06, 2013 9:00 am
In NSW at the moment if you have the option to build a home I would definitely go down this path as the government benefits does help.
You do not need to borrow money from parents or family if you approach the right bank who is licensed with the office of state revenue. This means that on the day of settlement your grant will be approved and will be paid to you when you start construction (payment is made on the first stage draw down being the slabs). While you are constructing there is no interest charged on the construction side until the first payment to the builder is made.
At the moment you have a 90% lend which gives you a wider range of lenders are you are purchasing in Country NSW which some lenders do not approve on. If you have the land and construction approved in one go this will mean that you will be building in the next month, a loan with $15,000 less in its balance saves $62 per month. You will need to decide if you want to bother family for $62 per month, it is a saving but also a hassle for the other party, unless they have cash under the bed =D.
UNLESS you are purchasing the land and holding it for 6 months then build, this can mean some more savings but really $360 over this period. Happy to answer any other questions that you =D
Re: First time builders - FHOG4
Aug 06, 2013 10:23 am
At this stage I think 15k from family isn't your main concern.
Reason being: there are plenty of other things which will increase the amount you 'think' you will pay (and it will be more than 15k) eg. site costs, upgrades, electricals, light fittings, curtains/blinds etc, landscaping, fencing etc etc. And if you are unwilling to bear these extra cost burdens (which may be 50k+), you may need to reevaluate. Have a search on this site for the extra costs associated with building. If you want to calculate extra repayments etc, most lending sites will have a 'loan calculator' section for you to play with. Theres plenty of help/advice around.
You may not need the $15k for the loan now, but you may need it later. Either way, good luck! building a house is a roller coaster ride.
Re: First time builders - FHOG5
Aug 11, 2013 9:19 pm
Thanks for the great replies guys! I have been able to go with a mortgage that is willing to accept our deposit as our savings + the FHOG. Once completed, as discussed above, it is paid directly to the lender.
Tonyattheponds - Our package price includes driveway, fencing, turf, site costs (including any rock removal and retaining wall), curtains, fly screens landscaping to front of house and small garden and even the clothes line.
We have many friends that have built locally with this company and not paid a penny over the contract price. Bearing in mind we are first home buyers we will not be making any upgrades - beggars can't be choosers
Re: First time builders - FHOG6
Aug 12, 2013 7:31 pm
don't forget fees (conveyancing, lands title , mortgage)etc etc , land stamp duty etc...
stuff not related to the house contract..
obviously it varies from state to state , but the some of the FHOG covers all that garbage..
a good mortgage advisor will run through whats needed..
Re: First time builders - FHOG8
Aug 12, 2013 10:03 pm
I have actually started concentrating on what they are not offering, for example one company is offering a fancy air con ducting but is not offering any electrical work ,which is weird lol.
Also to watch out for are the actual choices, some include 3 coat paints ...from their pastel range which is boring as hell, some have really boring options for vanities so make sure you are looking at that as well.
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