House and land packages Mackay

Loan Options for House and Land Packages Mackay

Mackay, a beautiful coastal city in Queensland, Australia, offers an enticing lifestyle with its beautiful beaches and lush surroundings. Little wonder, many Australian families aspire to own property in this region. 

House and land packages Mackay have become a popular choice for homebuyers, offering the opportunity to customize their dream home while enjoying the advantages of a bundled deal. 

However, financing these packages can be a complex process. In this blog post, we will explore the various financing options available to prospective buyers in Mackay.

Categories of House and Land Packages Mackay

There are two main categories of house and land packages:

1. Turnkey Package

In a turnkey package, the home is finished and prepared for immediate occupancy. All you need to do is turn the key in the front door and start living, as no additional work is necessary.

2. House and Land Package

In this option, you first secure the land and then proceed to build on it. While the land purchase comes first, there may be additional payments required during the construction phase.

Components of a House and Land Package Loan

A house and land package loan comprises two main elements:

1. Loan for the Vacant Land

This part of the loan is similar to a standard home loan and covers the purchase of the vacant land. The borrowing amount is contingent on the land’s size, with standard-sized plots enabling borrowers to access up to 95% of the land’s appraised value.

2. Loan for Construction

The second component pertains to financing the construction of the house. Approval for this component hinges on either the bank’s valuation upon construction completion or the building contract’s stipulated cost, selecting the lower of the two.

See also  New House and Land Packages

After obtaining approval, the construction loan is typically distributed in five phases. Following your verification and approval of the builder’s invoices and expenses, the bank disburses progress payments to your builder at the end of each stage.

During construction, your repayments are usually interest-only. The bank conducts regular inspections to ensure that the project aligns with the agreed-upon building contract. Once construction concludes, your mortgage begins, and you’ll start making principal and interest repayments.

How Turnkey Loan Package Works

In a turnkey property deal, the standard sale and purchase agreement between you and the builder details the total cost, encompassing both the land and construction expenses.

Upon signing the contract, you’ll typically need to provide a 10% deposit, with the remaining balance due after the construction is finished.

To disburse the remaining funds to the builder, the house must be finished and in alignment with your state’s code compliance standards, which is usually evidenced by a compliance certificate.

If you possess a 5% deposit and qualify for a 95% turnkey loan, the bank frequently offers the extra 5% deposit needed for the builder, thus allowing you to meet the 10% deposit obligation.

Differences Between a Construction Loan and a House and Land Package Loan

When securing a construction loan, the initial step involves acquiring vacant land, followed by the selection of a qualified builder to construct your home.

In contrast, a house and land package combines both components. When you acquire the land, you gain the option to choose from a range of standard or customized home designs, eliminating the need to wait for a builder to finalize designs and commence construction.

See also  House and Land Packages Canberra

Aside from this distinction, the method of making progress payments remains largely alike.

How Much Can You Borrow?

When buying land before construction, you have the option to borrow up to 95% of the land’s value. 

For a turnkey property, you can borrow up to 90% of its completed value. If you have a guarantor, you may secure 100% financing.

What Documents Would You Have to Provide?

The initial phase of your application will involve providing standard financial documentation to demonstrate your ability to borrow the necessary amount, which includes:

  • Your two most recent payslips.
  • Three forms of identification, for instance, a passport, driver’s license, and Medicare card.
  • A recent statement detailing any outstanding debts or credit card balances.
  • Bank statements from the last three months.
  • Proof of your deposit, typically in the form of a 3-6 month history of savings in a bank account.

For construction purposes specifically, you will need to provide:

  • A fixed building contract.
  • Building plans.
  • Building specifications.
  • Contract of Sale for the land.
  • Quotes for any additional work.

If you’re purchasing a turnkey property, all these costs are typically integrated into the contract, similar to a standard Contract of Sale.

To gain a clearer understanding of the necessary documents for a house and land package loan application, please refer to the construction loan documents page. 

We strongly recommend obtaining pre-approval first. This will simplify the application process, requiring only a few additional documents for your house and land package loan application.

About the First Home Owner’s Grant

The First Home Owners Grant (FHOG) can be used to finance a turnkey project but does not include support for buying vacant land.

See also  House and Land Packages Ballarat

The grant is only disbursed by the state when your initial payment to the builder is made.

Opting for a house and land package means the grant’s cost is directly paid to the lender during the first builder drawdown.

Submitting the house and land package loan as a single application can lead to significant complications, as the bank won’t release funds for the land until the builder is prepared to commence construction. This might result in the entire application falling through, necessitating a stressful last-minute resubmission.

To determine your eligibility for the FHOG in your state, utilize the FHOG calculator. 


Owning a house and land package in the captivating city of Mackay, Queensland offers both a unique coastal lifestyle and a real estate opportunity worth considering. 

We’ve explored the two main categories of house and land packages Mackay: turnkey and traditional, along with their respective financing components.

Looking to buy your dream home in Mackay? NY Properties Australia is known for providing exceptional customer service. The entire team specialise in overseeing the building process. This ensures that building your new house in the Mackay region is stress free. With our friendly team, your dream home can become a reality.