In this article
Kooky
Builder of Shaka, the payment router that pays every agent their commission on closing date.
About Kooky and Shaka →A house and land package is sold as one thing: a block, a floor plan, a price and a picture of the finished home. Legally it is usually two things. The buyer signs one contract to buy the land from a developer and another to have a house built on it by a builder. The two contracts have different parties, different rules about deposits, different protections and different deadlines, and the buyer is the only person who is a party to both.
That structure is the reason packages are popular, because it suits the way Queensland charges duty and pays its first home grant. It is also the reason they go wrong when they do. This guide explains how each contract works, how the money moves, what insurance stands behind the build, and which dates a buyer has to keep in view. It uses the rules published by the Queensland Building and Construction Commission, which regulates home building, and the Queensland Revenue Office, which administers duty and the grant.
Queensland Building and Construction Commission guidance on deposits and the Queensland Home Warranty Scheme; Queensland Revenue Office, first home vacant land concession.
What is being sold
The word package covers two different arrangements, and the first question to ask a sales office is which one is on offer.
In the common form, the buyer purchases a vacant lot and separately engages a builder. The land settles first. The buyer becomes its owner, and construction then starts on the buyer's land under a building contract. The advertised price is the sum of the two contracts.
In the other form, sometimes marketed as a completed or turnkey home, there is a single contract of sale. The developer or builder owns the land, builds the house and sells the finished product. The buyer pays a deposit and then the balance when the home is complete. That is a purchase of a new home, not a building project, and where the home does not yet exist at signing it is a purchase off the plan, with the rules that apply to those contracts.
Related readChecking flood risk before buying in Queensland: what the maps tell youThe rest of this guide is about the two-contract form, because that is where a buyer has the most to manage.
| Feature | Land contract | Building contract |
|---|---|---|
| Other party | The developer or land owner | A licensed builder |
| Usual form | The standard residential sale contract, with the developer's special conditions | A written domestic building contract that complies with the QBCC Act |
| Deposit | Whatever the parties agree | Capped by law, at 5% for most houses |
| Rest of the price | Paid in full at settlement | Paid in stages as work is done |
| Statutory insurance | None | Queensland Home Warranty Scheme |
Queensland Building and Construction Commission guidance for home owners; structure of the REIQ and Queensland Law Society residential contract. General summary.
The land contract
The land is bought like any other residential property in Queensland. The contract is normally the standard form published by the Real Estate Institute of Queensland and the Queensland Law Society, with a set of special conditions written by the developer's lawyers. Since 1 August 2025 the seller has had to give a disclosure statement and prescribed certificates before the buyer signs.
Three features of estate land deserve attention.
The first is whether the lot exists yet. In a new stage of an estate, lots are often sold before the plan of subdivision has been registered and a separate title created. The contract then depends on registration, which is in the developer's hands, and the settlement date is an estimate. A buyer cannot start building, and usually cannot fix a building price for long, until the title issues.
The second is the developer's design rules. Estates commonly set requirements about the size of the house, its materials, fencing, landscaping and the time allowed to start and finish building. In Queensland these building covenants are ordinarily contractual. They sit in the land contract and its annexures and do not normally appear on a title search. They bind the buyer, and the house design has to satisfy them before the developer will approve it.
The third is tax on the sale itself. The Law Society's notes on the current standard contract record that it carries detailed goods and services tax provisions, which rarely matter between private sellers and buyers but can apply when a developer sells new residential land. How the price is expressed, and whether any amount is to be withheld at settlement, is something the buyer's solicitor checks.
Related readThe cooling-off period in Queensland: five business days, explainedThe land contract can and normally should be made conditional. A finance condition on the land alone is not enough if the lender is assessing the land and the build together, which is one reason the two contracts need to be read side by side before either is signed.
The building contract
The second contract is governed by different law. The Queensland Building and Construction Commission says that any residential job worth more than $3,300 requires a written contract that complies with the commission's Act, and that contracts above that value must include advice about the owner's right to a cooling-off period. The commission also publishes a Consumer Building Guide, which explains an owner's rights under a building contract in plain terms.
The builder must hold a licence of the right class. The commission keeps a public register on which any builder can be searched by name or licence number, and it is the first check to make, before a floor plan is chosen.
Building contracts come in two broad kinds, and the commission's guidance on its warranty scheme shows why the difference matters. A fixed-price contract states the price for the whole job. A cost-plus contract charges the actual cost of labour and materials plus a margin, so the final figure is not known at the start. Package homes are almost always sold as fixed-price, and a buyer should confirm that the document says so.
Fixed does not mean final. Building contracts commonly contain allowances for items that cannot be priced exactly at signing, and the price can move through variations. Both are covered below.
Related readFrom today, Queensland home buyers are asked to prove who they areDeposits and progress payments
The rule that most distinguishes the building contract from the land contract is the cap on the deposit. A developer can ask for any deposit on the land that a buyer is willing to pay. A builder cannot.
| Contract price | Maximum deposit |
|---|---|
| Up to $3,300 | 20% |
| $3,301 to $19,999 | 10% |
| $20,000 or more | 5% |
| Any price, where more than half the work by value is done off site | 20% |
Queensland Building and Construction Commission, guidance on deposits and progress payments.
A new house falls in the third row. On a build priced at $380,000, an illustrative figure, the largest lawful deposit is $19,000. The commission's guidance says a builder may not ask for more than the legal maximum, and may not ask for payments that are larger or earlier than the contract provides.
After the deposit, the price is paid in progress payments. The commission describes two common methods. Under the first, payments are tied to construction stages, such as the slab, the frame and the roof, so the owner can see each stage finished before paying for it. Under the second, payments are made at regular intervals, and the builder must provide evidence of the value of work done in the period.
The principle is the same either way: money follows completed work. A buyer who has paid for a stage that has not been built is ahead of the builder, and that is the position the deposit cap and the progress payment rules exist to prevent. The commission warns that paying more than the legal deposit or paying ahead of the contract can affect a claim under the home warranty scheme.
How the loan is drawn
Finance for a package generally follows the two contracts. The lender advances money to settle the land, and then releases the building funds in instalments that match the progress payments in the building contract, usually after confirming that each stage has been reached.
Related readHomebuyer sentiment jumps 12 per cent after the August rate holdTwo practical effects follow. The borrower is paying interest on the land from the day it settles, and on each building instalment from the day it is drawn, while still paying rent or a mortgage somewhere else. A delay in registration of the land, or in the build, lengthens that overlap. And because the lender is relying on the building contract's price and schedule, a change to either usually has to be reported to the lender.
Lenders set their own terms for construction lending, and those terms differ. The general pattern is described here only so that the timing of the contracts makes sense.
Variations and a price that moves
A variation is a change to the building contract after it is signed. It may come from the owner, who decides on a larger patio or better benchtops, or from the site, where rock or poor soil turns up once work begins.
The commission's rule is that a variation must be put in writing before the varied work starts. The builder must give the owner the document, in person, by post or by email, setting out the change in scope, the effect on the timetable and the effect on the price. A change agreed in conversation on site and billed later is the pattern the rule is meant to stop.
Variations matter for two reasons beyond the obvious one. They can move the completion date, and with it every other date the buyer is working to. And they count toward the value limit for the First Home Owner Grant.
Related readLogan votes to shrink its flood overlay by more than halfThe $750,000 cap is the land plus the build plus the variations
The Queensland Revenue Office measures a home's value for the grant as the land and the building contract together, including any variations. A buyer who has been paid the grant must tell the office within 28 days if the value reaches $750,000.
A worked example shows how close the margin can be. Take land at $350,000 and a build at $380,000, both illustrative. The total is $730,000, under the limit. Variations of $25,000 for site works and upgrades take it to $755,000, over the limit, and the grant is lost although neither contract changed hands at a higher price.
Insurance behind the build
The land contract carries no statutory insurance. The building contract does. The Queensland Home Warranty Scheme, run by the commission, applies to residential building work worth more than $3,300. The builder pays the premium to the commission before work begins and recovers it from the owner as part of the contract price.
The scheme covers three situations, according to the commission: the builder does not or cannot finish the work, the builder fails to fix defects, or the building suffers subsidence or settlement. It pays up to $200,000 on a claim. Cover lasts six years and six months from the earliest of the date the premium is paid, the date the contract is entered into or the date work starts.
The kind of contract affects the cover. Under a fixed-price contract the owner is covered for both non-completion and defects. Under a cost-plus contract the commission covers defects only, because a claim for non-completion depends on a known final price.
The time limits are short at the front end. For a non-completion claim, the commission says the contract must come to an end within two years of work starting, and the claim must be lodged within three months of that termination. An owner whose builder has stopped work therefore cannot simply wait.
Related readMaking an offer on a Queensland home: from first figure to signed contractThe scheme is not home and contents insurance. Responsibility for insuring the works during construction is set by the building contract, and once the house is handed over the owner needs ordinary cover from that day.
Duty and the first home grant
The two-contract form matters most at the Revenue Office.
For a first home buyer, the first home vacant land concession applies to the land. The Revenue Office's page, updated on 31 July 2026, says that from 1 May 2025 no duty is payable on residential vacant land bought to build a first home, with no cap on value. The buyer must be an individual aged at least 18, must never have held an interest in a residence anywhere in the world, and must pay market value. For contracts from 1 August 2026 the buyer must also be an Australian citizen, a permanent resident or a specified foreign retiree.
The concession comes with conditions that run for years. The buyer must build the first home on the land, move in with their belongings and live there on a daily basis within two years of settlement, and may build only one home on the lot. The whole property cannot be sold, transferred, leased or rented before the buyer moves in. A buyer who does not meet the deadline has to notify the office, and the duty is reassessed with interest and possibly penalty tax.
The First Home Owner Grant is separate. The Revenue Office pays $30,000 toward a new home valued under $750,000, and a home built under a comprehensive building contract on land the applicant owns is one of the kinds of home that qualifies. In its State Budget notice of 23 June 2026 the office confirmed the grant continues for eligible contracts signed from 1 July 2026. The applicant must then live in the home for six continuous months.
Related readA median-income Queensland household can afford 9 per cent of homesA buyer who is not a first home buyer does not get either of these. Other duty concessions for owner occupiers have their own rules, and how duty applies to a particular package, including one where the land and the house are sold together, is a question to put to the buyer's solicitor before signing.
The dates that run at the same time
A package puts a buyer on several timetables at once, set by different documents and enforced by different parties.
The land contract sets the settlement date, or, for an unregistered lot, a date that follows registration. The developer's covenants may set a date by which building must start and another by which it must finish. The building contract sets a start date and a construction period, and the builder's quoted price may hold only until a stated date. The Revenue Office's concession sets two years from settlement of the land to living in the home. The warranty scheme measures its own periods from the building contract.
These dates interact. If title registration is late, the builder's price may expire before the land settles. If the build runs long, the two-year period for the duty concession shortens with it. A buyer who writes all of the dates on one page, with the document each comes from, will see the tight spots before they arrive.
Handover and the defects period
At the end of the build the owner inspects the house with the builder before the final payment. Items that are incomplete or defective are listed, and the list becomes the record of what the builder has agreed to fix.
The commission's time limits make the first months after handover important. A non-structural defect is covered by the warranty scheme only if it appears within six months of the work being substantially finished, and the claim must be lodged within seven months of that date. A structural defect must be discovered within the six years and six months of cover and claimed within three months of being noticed.
The scheme is a last resort, not the first step. The ordinary course is to raise a defect with the builder in writing and give them the chance to return. Where that fails, the commission can inspect and direct a builder to rectify. Keeping the contract, the variations, the progress claims and the handover list together makes each of those steps easier.
Putting the steps in order
Most of the difficulty in a package comes from signing one contract before understanding the other. The order below keeps the two in step.
- Check both partiesSearch the builder's licence on the QBCC register and read the land disclosure statement and covenants.
- Price the whole homeAdd land, build, site costs and likely variations, and compare the total with the grant limit.
- Sign with matching conditionsMake sure finance and timing conditions in the two contracts work together.
- Settle the land, then buildPay the capped deposit, then pay each stage only when it is complete.
- Hand over and move inList defects in writing, insure the home, and meet the residence deadlines.
A package is a convenient way to buy, and for a first home buyer the duty and grant rules reward it. The convenience belongs to the brochure. The buyer still holds two contracts, and the protections in each apply only to the party on the other side of that one.
Kooky, from Shaka
Kooky edits Queensland Estate and builds Shaka, the payment router he made for Queensland property professionals. One payment comes in, and every agent, agency and party in the deal receives their signed share on closing date.
