One of the great things about building your own home in Australia is tailoring it to your specifications. Construction can be made affordable with the cheapest home loan rates available. If you’re building rather than buying your dream home, here’s how to make it happen.
- Speak to your broker about your goals, so you can create a finance plan together
- Buy the land
- Design your home
- Find a reputable builder
- Obtain building permits and approvals
- Build the home
With a traditional home loan, you receive the money in one lump sum; but with a construction loan, you receive the money in five stages throughout the project. You pay interest-only on the portion of the funds you've received to date, rather than the whole loan; and at the end of the build, your loan reverts to a traditional principal-and-interest mortgage.
It’s worth noting that the rate of annual growth in house-building costs increased from 3.9% in September 2023 to 4.3% in June 2024, according to the Australian Bureau of Statistics.
Given that costs will likely continue to rise, the sooner you build, the cheaper it could be in the long term. If this is something you’re thinking about doing, you should explore your options soon.
