Hello everyone. After info regarding the process for a joint venture where party A owns the land, party B is capable of finance for construction (that party A is not) and construction would be of a dual occupancy subdivision splitting 1 property each at the end. Both parties are happy with builder Z. Thanks alot. Nathan
Personally I wouldn't do it that way. It's unlikely the bank would allow a construction loan on for a party who doesn't own the land. #notalawyeroraccountant I would buy the land jointly and do a deed of partition. You subdivide the land and then own 50% of each others lot, deed of partition you "give" each other the 50% and if the land is equal and same value there is very little stamp duty of CGT incurred. Then you each have a construction loan with the builder and do it indendantly but concurrently At the end you have the same result but lending is easier and less stamp duty, less CGT also you are independant of each other a lot earlier.
2nd @Westminster but will also add pending the construction loan might need to be joint until built at which point is split (can be required if party wall)
Another option would be to sign a development agreement with the land owner and put a caveat over the property. You fund the construction and at the end level up the money, purchase half the property and lift the caveat. You both walk away with one side each. This would save you paying any stamp duty up front.
This would depend on the terms of the agreement. Probably wouldn't work in Victoria and you have to consider the tax consequences too.
How is the split going to be done ? Lessor / Lessee Party A owns the freehold Party B owns the building (leasehold) ?
