Browse Forums Building A New House 1 Jan 06, 2015 9:35 pm Hi, Hoping for some advice or a 'what would you do in this situation'!! We have paid deposit on land, and its not due to be registered/settled until March (or even later). Once it is officially ours, we plan to put our current home on the market as we need the sale to be able to afford the build. What we are unsure of though is when we should arrange the building side of things? We have a builder in mind, and they have said theyre willing to meet this month to discuss quotes. They told us we pay $1500 for them to then do soil testing etc, give us an official pricing, choose brickwork, colours etc. Ive explained that we cant really fund anything until sale of our house, which wont be on the market until Land settlement but the coordinator said it all takes time so it wont hurt to start arranging things soon. Of course the concern here is that the land takes longer to settle, or our house takes longer to sell. We may also have to pay 5% deposit to lock in the contract which we'd have to fund from our own savings.. We can play it 'safe' and wait until our house sells, but then we are renting for longer and delaying the whole process longer than we would like. What would you suggest? anyone experienced something like this and did it work for you? Re: Timing everything - Any advice??? 2Jan 06, 2015 9:50 pm You can finalise discussion with builders which have a minimum of 365 days tender validity. One of these is Eden Brae Homes which has an ongoing promotion of fixed pricing for 12 months without any charge. Clarendon Homes has a 290 day fixed price promotion as well which will take you up to 9 2/3 months but I believe that you can ask them to match that of Eden Brae Homes. That should give you enough time to sell your property. By the way, why do you have to sell your property when you can use its equity to fund your new property inclusive of the house? Talk to brokers who can advise you on how to go about this. Re: Timing everything - Any advice??? 3Jan 06, 2015 10:08 pm Thanks very much for your answer, I hadnt thought of that. I'll check with the builder and hopefully they have a long period for fixed pricing. We have looked into the option of keeping our current home and selling it following the build, however it all ended up very confusing! Our current bank said we could if we contributed nearly $50 000 (which we dont have just laying around!), and mortgage brokers said we could easily do it but it left us sceptical when our own bank, said we couldnt.. So while its not ideal for us we just have to look at selling. The real estate is pretty good here at the moment so we will hopefully make a bit on our place to then cover the cost of the build we would like, plus some. thanks again for your help! Re: Timing everything - Any advice??? 4Jan 06, 2015 10:15 pm Just in regards broker vs bank - acknowledging I am biased - we're often much better trained & the bank is designed to minimize their risk. Which bank is it? Ask the question, you just never know. Rebecca Jarrett-Dalton Property crazy expert mortgage broker, love building new homes! Two Red Shoes mortgage broker http://www.tworedshoes.com.au/building Re: Timing everything - Any advice??? 5Jan 06, 2015 10:19 pm It's teachers mutual bank (hope its ok to share that!). What annoys us most is that the mortgage repayments by building while in this house, seem to be less than us paying rent and mortgage for land and construction (if we sell). The rent in our town is higher than our current mortgage is.. Re: Timing everything - Any advice??? 6Jan 06, 2015 10:24 pm They're a little conservative. They use valuer generals land valuation plus the build cost. That's not the same as most banks use. That's possibly where the problem ******. You should at least explore your options perhaps? Not surprised the rent is higher, that's not extraordinary. Rebecca Jarrett-Dalton Property crazy expert mortgage broker, love building new homes! Two Red Shoes mortgage broker http://www.tworedshoes.com.au/building Re: Timing everything - Any advice??? 7Jan 06, 2015 10:25 pm Hmm well thank you! This gives us something to think about. We had enquired with a broker a few months ago so might get in touch with her again to look at options. Re: Timing everything - Any advice??? 8Jan 06, 2015 10:29 pm i would wait until after you settle on your land. my titles were delayed by 3 months and 2 of my friends their titles were delayed by more than 6 months. play it safe. Re: Timing everything - Any advice??? 9Jan 07, 2015 6:29 am We had a similar dilemma. And our house just wasn't selling. What we have done is borrowed our current property up to 90% in order to borrow the new build up to 90% also. So effectively we have used our equity as a deposit for our new home. Our plan is to put this back on the market again, but IF it doesn't sell, we can keep it and rent it out. We used a broker who also said different to what the bank was telling us. In my experience so far, the bank's way would have been costing us WAY more LMI and would have been more difficult altogether. Talk to a broker Good luck! Jo Building 'The Havana Executive' on 1200sqm Re: Timing everything - Any advice??? 10Jan 07, 2015 2:59 pm Our land title got delayed by 3-4 months too and I have heard of much longer delays than that! Don't believe what the developer tells you (timing wise). Having said that, I personally would start the building process as long as you can get a fixed price for 10-12months. Get all your colours and selection appointments our of the way so you are ready to go when you title. As for selling the other home/borrowing against it, I'm not too experienced with that sorry. A question. 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