Hi,
I'm new to this forum and similarly new to buying land. When a developer says that a 10% deposit is required is that to be handed over straight away? The area I'm looking at is in high demand and when a new release is made, I want to make sure I'm in a position to buy it. However, I don't have a set price on the land I want so I can't get a bank cheque prepared in advance. Any advice?
10% deposit for land
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You should be able to secure the lot by paying $1000 deposit money.
Then you will be asked to pay remaining amount ($9000) in couple of weeks time.
If you change your mind within this time then you can nicely ask for a refund of $1000
Then you will be asked to pay remaining amount ($9000) in couple of weeks time.
If you change your mind within this time then you can nicely ask for a refund of $1000
With our estate it was $1000 deposit. The remaining deposit to make up the 10% wasn't payable for quite a while.
Our deposit to secure the land was $2000 and then 10% - $2000 agreed date mostly 1 or 2 months after depending on you bank loan pre-approval
We had to put a $1000 deposit down and that's all we had to pay until settlement which was then just the remaining total amount
We put down $1000 initially to reserve the block and paid 5% within a month, after going over the land contract with a good solicitor. Remaining money paid during registration of land.
We had to pay a 20,000 deposit for our block. From memory we chose the block off the plan (untitled), signed the offer and acceptance contract subject to finance and then had 21 days to provide proof of finance approval / transfer the deposit. The deposit was held in a trust account by the developer and we earned interest on it until our block was titled and settlement went through (a year later).
Thank you for everyone's replies!! I spoke to the developers today and they informed me of the prices of the blocks of land and that I would need 10% on the day of release if interested. I'm gonna need a fairly hefty bank cheque by the sounds of it :/
I think that's crazy! It should only be $1000 or so to secure the block. Speak to a conveyancer and they should be able to tell you that $20000 is unacceptable to secure a block considering banks need to be consulted. Sounds like the developer is trying to weed out people who may not be able to afford the blocks to save on time wasted in the process of it all.
Building with Coral Homes - The Daydream 30
Building with Coral Homes - The Daydream 30
Must be a high demand estate.
I only had to pay $1,000 upfront and then on confirmation of finance I paid the balance of 5%. My estate told me they only take 10% deposits, but my conveyancer told them I would only pay 5% so that's what I paid.
If it's a high demand place, maybe they expect the full deposit and finance approval on the day, rather than a delay while you sort out finance approval.
I only had to pay $1,000 upfront and then on confirmation of finance I paid the balance of 5%. My estate told me they only take 10% deposits, but my conveyancer told them I would only pay 5% so that's what I paid.
If it's a high demand place, maybe they expect the full deposit and finance approval on the day, rather than a delay while you sort out finance approval.
Must be a high demand estate.
It is every developer's wish to raise demand, artificially or otherwise, in their estate.
To the OP - ask your developer for a published sales brochure that says you are required to pay 10% deposit on the day of land release. Check with your solicitor if it can be negotiated with the developers.
i should have negotiated this well too late now i have paid this already but buying the land anyways.
Ensure you read the comtract of sale, there is usually a clause that allows the deposit to be negotiated. Developer advertised a 10% deposit as requires. I asked prior to signing the contract and only had to pay 2.5% and the remainder on the land title / settlement.
I put a deposit of $1000, then $4000 once my contract went unconditional. The balance wasn't due until settlement.
If that is the case ask developer for a copy of the contract so you can check it out before the release. Otherwise you will have 8hrs to chose block, pay 20% and read and sign a contract that's not really enough time to go through it properly.
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