House & Land Packages
Build your dream Melbourne home with a tailored loan structure that protects your cash flow from ground break to handover.
We Handle the Finance, You Build the Dream
Whether you’re looking at a master-planned community in Melbourne’s growth corridors or securing an infill block closer to the city, a brand-new home offers custom layout choices, energy efficiency, and a fresh start.
However, the finance behind house & land packages can get confusing very quickly.
Unlike buying an existing home where you make a single deposit and settle all at once, building involves two separate contracts, staged bank payments, land titles, site valuations, and strict builder timelines. Trying to coordinate valuer inspections while juggling land settlement dates and builder progress claims can feel overwhelming if you’re left to handle it on your own.
At The Melbourne Mortgage Company, we take the friction out of the process. We work directly with you, your builder, and your conveyancer to structure a seamless house-and-land package loan. We handle the bank back-and-forth, align your drawdown stages, and protect your cash flow so you can focus on choosing your finishes instead of stressing over paperwork.
How a Land and Construction Loan Works
Even though you’re purchasing a single package from a developer or builder, the finance is separated into two distinct components: the land purchase and the build.
First, you acquire the block of land through a standard land loan. Once the land settles and is titled in your name, the builder can prepare the site and commence earthworks.
Second, your build is funded through a construction loan. Instead of releasing the entire construction budget up front, your lender pays the builder in five progressive drawdown stages as key construction milestones are completed. During the build, you only pay interest on the amount that has been drawn down so far, which keeps your monthly expenses manageable while construction is underway.
How It Compares
To help you visualise how this loan differs from a standard mortgage on an established property, here is a quick side-by-side comparison.
| Feature | Standard Home Loan | Land and Construction Loan |
|---|---|---|
|
Number of Contracts
|
Single purchase contract
|
Two contracts (Land contract + Building contract)
|
|
Fund Release
|
100% of funds released at settlement
|
Staged releases (Progress payments to builder)
|
|
Repayments During Build
|
Full Principal and Interest from Day 1
|
Interest-only on the drawn balance during construction
|
|
Stamp Duty Liability
|
Paid on the total property purchase price
|
Typically paid on the land value only in Victoria
|
|
Valuation Timing
|
Single valuation before settlement
|
Initial valuation on plans, plus inspections at key build stages
|
Stamp Duty and Government Incentives
Choosing house-and-land packages across Victoria comes with significant financial advantages that go beyond simply living in a brand-new space.
One of the biggest financial wins is the stamp duty savings. When you buy an established home, state government stamp duty is calculated on the full purchase price of the land and the house combined. With a new build package, stamp duty is generally calculated only on the value of the vacant land, provided you sign the building contract before construction begins. This single feature can save you thousands of dollars in upfront entry costs.
For first home buyers, building new can also unlock valuable government assistance. Depending on your eligibility, you may be able to pair your build with the Victorian First Home Owner Grant (FHOG) or access federal deposit guarantee schemes that allow you to secure your loan with as little as a 5% deposit without paying Lenders Mortgage Insurance.
Frequently Asked Questions About House & Land Loans
Dealing with two separate contracts and staged loan drawdowns naturally brings up a few detailed questions. Here are practical answers to the queries we hear most often from Melbourne buyers.
It is very common in new estates to buy a block of land before it has been formally titled by the developer. In these cases, you pay a holding deposit on the land and wait for civil works to finish. Your home loan approval is structured so that land settlement occurs as soon as titles are issued, at which point your builder can lodge council permits and prepare to pour the slab.
The key to a smooth approval is having a fixed-price building contract that includes a clear tender, detailed scope of works, and an agreed progress payment schedule. Lenders want to ensure there are no surprise cost overruns mid-build. When you work with TMMC, we check your builder’s documentation beforehand to ensure it meets bank requirements before formal submission.
Not necessarily. Many leading Australian lenders offer competitive variable and fixed rates for construction loans that align closely with standard residential mortgage rates. Some lenders may charge a small administration fee for handling individual progress inspection payouts. We’ll compare loan options across our entire panel to keep these fees to a minimum.
Lenders usually arrange a quick site inspection or review photo evidence before releasing funds for stages like Lock-up or Fit-out. To prevent delays, TMMC may act as the central coordinator between your builder and the bank’s valuation team, ensuring progress claims are reviewed and paid promptly so work on your home never grinds to a halt.
Why Choose The Melbourne Mortgage Company?
Securing the right funding for a build requires more than just picking a low rate off a screen. It requires a dedicated team that understands builder contracts, valuation guidelines, and local Melbourne land developments.
Here’s why local buyers partner with TMMC for their construction journey:
Dedicated Borrower Advocacy
We represent your best interests at every stage, negotiating directly with lenders to secure flexible drawdown terms and competitive rates.
Full Concierge Service
We coordinate progress payments directly with your builder and conveyancer, taking the administrative burden off your shoulders.
Clear, Straightforward Guidance
We explain every milestone in plain English, so you always know where your money is going and what comes next.
Tailored Lending Solutions
Whether you are a first-home buyer using government grants or an investor building a duplex, we match your project with lenders who specialise in construction finance.
Deep Local Real Estate Knowledge
From growth suburbs in the West and South East to infill sites in established Melbourne neighbourhoods, we understand local land values and estate requirements.
Start Building Your Dream Home
You don’t have to figure out complex build contracts or staged bank drawdowns on your own. Let us handle those so you can focus on watching your new home come to life.
Get in touch with our team today for an obligation-free consultation. Let’s make your building journey smooth, transparent, and rewarding.