Property Investment: Why buy house and land packages?
In recent years over the fringes of Sydney, we’ve seen a great number of new property developments pop up, offering budget house and land packages with great incentives for investors.
New developments such as Ropes Crossing, in St Mary’s, Jordan Springs, near Penrith and Gregory Hills, near Narellan, offer new house and land packages for as little as $230,000 with extra included incentives like builder paid stamp-duty and tax rebates.
Investment Property Coach, David Ferguson from Sydney, said that the supply and
demand for housing in the Sydney market is booming. This is a great opportunity for investors to snap up one of these packages as soon as they can.
“It’s not uncommon for new house and land packages to go instantly,” said David.
“In today’s market there’s just a desperate shortage of stock.”
At the moment there are 1,000 people per week moving into Sydney. Where are they going to live? There’s huge pressure to provide more housing and the shortage of land at the moment is a clear indication that the pressure won’t ease soon” he said.
With the Sydney property market under this type of pressure, investors can expect to make good returns on these new developments. House and Land packages are the standard type of purchase for investors in theses areas.
“When developers open up a new suburb they price the initial release competitively. They may sell places for $250,000 then, after it looks like a suburb, they’ll bump the prices up by $50,000 or so. The people who bought there initially get that price bump straight off the bat, should they choose to sell” said David.
“The reason they do this is to entice people to buy before the area is fully developed. It’s not so much a risk, it’s being able to look at a plan or a model and see the potential”.
On top of this initial value increase, a new suburb will continue to increase steadily in price as further developing continues around it.
Developments like rail infrastructure, new village centres and recreational land will add significant value to the property. In new developments, these are usually already factored into the development plans for the area.
David stressed the importance, however, of knowing what you are buying when signing up for a house and land package.
“Make sure all the trimmings are included,” he said.
“A house and land package isn’t a package if a fence or driveway is an ‘optional extra'”.
He also encouraged opting for extras where possible. Things like built in wardrobes or larger appliances in the kitchen can be worth the extra money as they appeal to the market and will help secure tenants.
“Extras like a 900ml cook-top in the kitchen will entice buyers or tenants to choose your property over others and will ensure you always have someone renting.” he said.
See some of our current house and land packages below.
By Jordan Cox and James Parnwell
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