Join Australia's most dynamic and respected property investment community

Process to buy a parcel of land

Discussion in 'The Buying & Selling Process' started by kerry kerry, 23rd Jan, 2016.

  1. kerry kerry

    kerry kerry Member

    Joined:
    30th Nov, 2015
    Posts:
    9
    Location:
    NSW
    Hi there,

    We are looking to buy a parcel of land in NSW and also we are fairly new to the whole process.
    After reading a lot on this forum, I gained immense knowledge and information but when it comes to bringing up myself into the process I still don't feel confident.

    So we are heading up next week to look onto few blocks of land in which we are interested to purchase. This is basically a new estate with new land release. We are quite familiar with area and our plan is to first purchase the block of land and then hold it for a year or year and a half then later build it and occupy as PPoR.

    So next week our plan is to have a survey of the blocks of lands available. They are all in a range of 600-700 sqm. So whats next?
    Do we need to put on deposit (2k) once we decide on the land or first we negotiate the price.We haven's spoken to any lawyers,solicitor or conveyancer as yet. When do we need to speak to land surveyor or how do we get the soil tests done?

    Can someone please tell me the steps?
     
  2. teetotal

    teetotal Well-Known Member

    Joined:
    7th Nov, 2015
    Posts:
    398
    Location:
    Sydney
    Yes you'll need to put deposit (they'll tell you how much needed).
    If it is new land estate, you cant negotiate due to their fixed prices unless its a private sale.
    Once the land is ready for settlement i.e. they have built the roads around the land put the infrastructure in and filled it where needed, you can initiate the soil tests etc.
    Usually builders will do the soil testing for you but given you are holding it for a while so you may need to organise it yourself.
    Speak to a conveyancer once you have selected the land and made the holding deposit and received a copy of the contract.
     
  3. wombat777

    wombat777 Well-Known Member Premium Member

    Joined:
    18th Jun, 2015
    Posts:
    1,409
    Location:
    33°41'24.7"S 150°55'34.3"E
    Best to buy a block that is already registered. They occasionally pop up for resale. Can be hard to find in a hot market.

    Development of an estate can take 12 to 24 months after you pay your deposit. Also be careful of sunset clauses that some developers use to cancel contracts and then resell blocks at a higher price.
     
  4. Cactus

    Cactus Well-Known Member

    Joined:
    18th Jan, 2016
    Posts:
    977
    Location:
    Melbourne
    If your not planning on building for 12 months, I'd buy OTP speak to agents about anticipated titl date and get something that's further of and negotiate a 5% deposit. This way you can speculate on any upside without holding costs. No point getting a soil report builder will get their own anyway for liability reasons so just a double up of costs. Have a chat to agent and some builders in the estate to get an idea of what soil classification and site cost is likely so you can factor these costs into your build budget.
    Not sure why@teetotal says you can't negotiate on OTP in my experience nothing is fixed price, and although developers are unlikely to discount in a good market, if they are trying to raise cashflow or sell a difficult block or market is tough they will negotiate. Public ally listed developers general unless it's titled and settlement in time for their end of FY bonus. Private developers are more likely to do deals on OTP at any time. Remember if you put an offer in writing to a real estate agent he is obligated to present it no matter how embarrassing it may be.

    Good luck!
     
  5. RumpledElf

    RumpledElf Well-Known Member

    Joined:
    21st Jan, 2016
    Posts:
    137
    Location:
    Sydney
    There's a $5000 grant in NSW for building that comes off your stamp duty. I'm looking at a couple of blocks of land too, this grant can make a nice dent in the expenses. I put an offer to an agent verbally (voicemail) last week and have had it verbally accepted and have no idea how the buying process works in NSW either but the agent just wanted my conveyancer's details. All the blocks I've been looking at are infill blocks that are sloped and heavily covered in vegetation though so I'm completely crazy.

    Nobody has asked me for money yet but they said I could do a transfer ... I've had agents ask for cash, take my credit card, need a cheque and take bank transfer in SA, with various time frames from 'immediately' through to 'eh, in a couple days is fine'.
     
  6. kerry kerry

    kerry kerry Member

    Joined:
    30th Nov, 2015
    Posts:
    9
    Location:
    NSW
    Well we looked into some blocks, liked quite a few of them.
    Did not get a chance to talk to the seller as we were there at evening just to had an idea of the location and surroundings.
    Today we called the seller which is a big RE agent.He straight away sent us all the contracts, bush fire reports,Geo technical reports, contour plan, price list, etc etc etc u name it.
    I believe the price list would be fixed because as we can see on the list, a lot of them sold on the price which they originally advertised.

    So, depending upon on the location and price ,we chose 3 blocks out of which will chose the one which suits the most. Should I now start looking for a conveyancer now or just ask the seller to have my own soil tests done.Or shall I put the offer before speaking to the conveyancer?

    I have option for registered land as well as unregistered with earthworks due to completion in early april. What do you suggest?
     
  7. Alexia Harris

    Alexia Harris New Member

    Joined:
    24th Oct, 2015
    Posts:
    1
    Location:
    SA
    Hi, I think your first step should be to hire a land surveyors llike Thompsons surveyors . They will first survey your land and will survey everything about your land. Second step should be to hire a contractor who can look after the surveying thing.

    Thanks
     
  8. teetotal

    teetotal Well-Known Member

    Joined:
    7th Nov, 2015
    Posts:
    398
    Location:
    Sydney
    1.Talk to your conveyancer now.
    2. Offer and Put a holding deposit on the land which holds it for you for usually 14-21days.
    3. You don't really need soil tests to be honest, just google what kind of soil it is in that area or try to find from someone who's building there.
    4. Buy the one which i as ready to go, saves you time and you can check of the land is level or not (gives you an idea of site costs).
    5. Get the plans from the RE agents.
    6. Talk to your builder to see if your house can be built on that land.
    7. If all good, go ahead with the purchase. If not, get the holding deposit back.
    8. Enjoy your building process or start looking again.
     
  9. kerry kerry

    kerry kerry Member

    Joined:
    30th Nov, 2015
    Posts:
    9
    Location:
    NSW
    Thanks all
    That all makes sense to me now.
    Spoken to few of conveyancers last week. They are all charging in ranges from 1400-1800 for total costs including disbursement costs.
    Should I also hire a land surveyor at this stage or just go ahead with the conveyancer?
     
  10. teetotal

    teetotal Well-Known Member

    Joined:
    7th Nov, 2015
    Posts:
    398
    Location:
    Sydney
    Your builder will take care of land surveys, soil tests etc.
    You only need a conveyancer to go through contracts & stuff and act as a legal contact person for the other party. Follow the steps as I suggested above.
    Have you chosen the land ? Which area ?
     
  11. kerry kerry

    kerry kerry Member

    Joined:
    30th Nov, 2015
    Posts:
    9
    Location:
    NSW
    Thanks teetoal

    If I plan to buy land to hold only for a while and construct later say a year after, do I still need to undergo the soil tests through a builder or just leave it as it is now and do this later?
    As the current geotech report says that the lot is H1, should I rely on it and let go till the construction actually commences?

    Or may be I never be building and just holding the land and later sell it say after two years.So I assume I wouldn't be needing any builder at this stage.

    I am buying land at Maitland nsw.