When you buy a home it is usually the land that increases in value, not the building.
A decade ago, land represented approximately one third of the value of the average new house and land package. Today, land typically represents more than half the total cost. Whilst all land has value, some blocks are certainly worth substantially more than others. Consider some of the following points before you buy.
The scarcity of land is generally determined by geographic features such as how near a river, lake, ocean, hills or unique developments you are. The fewer properties that are available the greater the demand and the higher the price they can command.
Every square metre of land has a value. So the bigger the land size in any given area and circumstances like view, the higher the market value. Compare the price paid per square meter for similar blocks in the area where you intend to buy to ensure the price you pay represents a fair value at the time.
Location has always been the key to good capital growth in Real Estate. A good location can be qualified in many ways. It can mean a prestigious suburb, close proximity to the CBD, a property nestled idyllically in rolling hills or by crashing waves. What Buyers should consider about location in any suburb, or anywhere in the country, is the convenience and lifestyle that most closely meets their needs and more than likely others requirements.
A block located in a quiet street, close to public transport, health services, education, recreation and shopping is going to appeal to many future home buyers, and the benefits that these features offer will represent a value that they are willing to pay for in the long term.
Take into account the proximity of connections to the services such as sewerage, electricity, gas and water to the land and to the most suitable building site.
If you’re buying a block of land in a new subdivision, you’ll need to know the future plans for the location of shops, schools, access to public transport and building of roads or highways.
Building a new home
There’s something special about building a new home. There’s all the excitement and anticipation that goes with the planning and design, and then deciding on a new home builder.
Covenants (rules) often exist on a new estate and are a specific set of minimum standards for building construction and land use that are in addition to building codes and are applicable for every property owner in the estate. For example, the design of the home may need to include a double garage or have a minimum living area of 250m2. Ensure you secure a copy of the covenants and understand the commitments and provisions prior to purchase.