For most people, the dream of home ownership begins when they see their perfect property. But for others, they have plans that they want to bring to life, which is why they turn to building their own.
Making the decision to construct your own property is not one that should be taken lightly. Instead, you need to give it plenty of thought, and not to mention weigh up whether or not it’s financially viable.
How is the Australian construction sector performing?
There is some good news if you do decide that this is the way forward, as the national construction industry is going from strength to strength. Although the Australian Bureau of Statistics (ABS) revealed a 0.1 per cent fall in approvals during May, property groups nevertheless remain optimistic.
Among them is the Property Council of Australia. Executive director Nick Proud explained that the market is generally moving in the right direction, which may give you the impetus you need to approach a mortgage broker about a construction loan.
“In just a few short years approvals have increased substantially – today’s level is an increase of 70,000 on the 12-month period to May 2012 when nationally we recorded 147,727 building approvals,” said Mr Proud.
He noted that not only would this spell good news for the construction sector, but also give housing affordability the boost it needs for first-time buyers throughout the nation.
Weighing up the costs
There are various costs you will need to think about when constructing your own home. Among the most important are:
• How big a property you are hoping to build
• Location (sought-after suburbs will come with a higher price tag)
• The level of landscaping you want
• Quality of the materials used
• Cost of labour
One of the crucial pieces of information you will need is how much you’ll be expected to pay for a plot of land. Your state valuer-general will provide guidance on this, so it worth taking a look before determining how much you can borrow.
The fact is that there is no way of telling how much your project will set you back until you work out some specific pricing. However, setting yourself a realistic budget will ensure that your ambitions can become a reality without breaking the bank.
No matter what route you decide to take, make sure you use a home loan calculator to determine just how much you can afford to borrow. This will be the first step in finding out whether your dreams can become a reality.