Process for purchasing land in Melbourne

[spamjam]

Hi,

 

We are interested in a plot of land that has planning approval for a house in Melbourne. We've been to see the land and have copies of the plans, section 32 and soil tests etc. and are looking into the mortgage side for building your own home (previously we were looking at just buying an established home). We are currently trying to get estimated build/site costs so we can figure out the finances but it's proving a little difficult to get anyone to give us a ball park figure.

 

We are not familiar with the system here for buying land/houses and so I just wanted to ask a little advice on a few things :unsure:

 

1. What other research should we be doing on the land before making an offer? Any pitfalls we should lookout for? The site is fairly flat, has some trees that require protection during construction and is classified as 'M' class soil.

 

2. What is the best way to go through the negotiation process with the real estate agent? Do we have to make our offer in writing and when does it become legally binding? Should we get our conveyancing solicitor to draw up the offer with any conditions etc?

 

Although we've bought and sold houses in the UK before it's a little daunting looking at doing it here with a different system and also looking to buy and build rather than an established home, so any advice would be gratefully received :smile:

[Guest The Pom Queen]

I remember when we bought our first house over here, I thought the agent was trying to pull a swift one. It turns out the agents themselves deal with the contracts and you don't need a solicitor unless you feel more comfortable with one. We did still go to the solicitor and it made the process less stressful. When we purchased our 2nd property we used a conveyancer and they were terrible, there were complications and she didn't care or try to protect us. Our 3rd property we went back to the solicitor.

When you put in your offer they usually ask for something like $500, if your offer is refused you get the money back if its accepted then they ask for the 10% deposit or whatever has been agreed minus the $500.

Remember you can change the contract to suit yourself, on the last property we bought we didn't have funds for the 10% deposit as all our money was tied up in our house we were selling so we told them we would give them $5000 deposit and they would get the balance on completion, the owners were fine with this.

[Guest The Pom Queen]

For buying land this may help

 

1. Shape upDon't just focus on the size of the land you're buying - the shape of the site is vitally important too.

 

 

Irregular blocks can offer exciting opportunities to create an impressive home, wide blocks offer the opportunity for imposing street-presence and deep blocks offer the opportunity to create fantastic garden spaces.

 

 

However, elongated, battle-axe or angular blocks can offer problems for the unwary. An expert architect or builder is required to maximise these blocks without wasted space.

 

 

2. Consider slope and soil type

Blocks with a steep gradient that have not been retained will incur high building costs.

 

 

Sandy and light soils may need reinforcement even over light gradients, and thick clay or rocky soils may incur additional excavation and tipping costs.

 

 

3. Look for ground-water

Damp blocks may require additional drainage, even across garden areas, while the costs or suitability of underground garaging or cellaring can vary hugely depending on the wetness of the site.

 

 

4. Orientation

Even the most poorly oriented block can look sunny and elevated when it is vacant - get an expert opinion on how your block's exposure to sun, wind and rain will affect the home you hope to build.

 

 

5. Check on services

While most blocks in established areas are fully-serviced, you can't automatically assume that all services are available. Blocks on new estates, in rural and remote areas will often incur additional costs for service connection.

 

 

6. Check out the neighbourhood

Your re-sale and enjoyment are dependant on the neighbourhood you purchase in.

 

 

Take into consideration the location and quality of the surrounding homes and consider whether the home you want is appropriate. Then think about how you will live in the home - are shops, transport, entertainment and schools close-by?

 

 

Think about how long you plan to live in the area and whether it can meet your needs now and in the future.

 

 

7. Uncover easements and impediments

Check the Land Title Certificate carefully, visit the Council and approach the relevant bodies to discover whether there are encumbrances on your land.

 

 

An easement in the backyard may be a small thing unless it happens to be where you want to put the pool, a road-widening order or heritage listing may not affect how you use the block today but could be vitally important to whether you can profitably sell your home in the future.

 

 

8. Document everything

Check and recheck the documentation relating to your land purchase. If you are purchasing subject to certain conditions, make sure that all the details are fully recorded in the purchase documents... and that you understand exactly what those details mean.

[Guest The Pom Queen]

Take a look through this as well

http://www.consumer.vic.gov.au/housing-and-accommodation/buying-and-selling-property

[spamjam]

Thanks Pom Queen for your advice and the links, I'll check them out. We're still considering our options - unfortunately it seems the land we were looking at might be in a flood risk area so we putting it hold for now and having a think about it.

 

it's useful to hear your experience with conveyancers and solicitors, it's something we haven't really looked into too much as yet but I think we will have to start getting these things in place soon so we're all ready to go when we find the perfect plot of land or house! :-)

 

Thanks :-)

[Eera]

M class soil indicates the expected seasonal ground movement is between 20 and 40mm, normally a slab will cost roughly the same for the S class (0 to 20mm) and the M, so there shouldn't be any extra charge there, make sure they're not stinging you and extra $10k or so over the S class price.

[spamjam]

OK thanks Eera, that's good to know - I didn't realise that the slabs were similar for these different classes so I'll watch out for that if we do go along the building route. Went to see a few homes on Saturday and quite liked them but seem to always find some downside to each one - new developments overlooking backgarden etc. Oh well, maybe we will consider building after all... at least then you can get what you want. :-)

 

Cheers!