top of page

Turn Key vs Home and Land Builds

Building a home is an excellent way to get exactly what you want, and in some cases it’s also a lot cheaper than buying an existing home. When looking to build, it’s likely you come across “turn key” and “home and land” builds, but what is the difference?


These are the most common and simple construction contracts. You pay an initial deposit, which is usually 10% of the total price, and the remaining 90% once the house is finished and has received its Code of Compliance.

Once the build is done, everything is usually done for you so, as the name suggests, you literally turn the key and move in!

This type of build is a lot easier to manage as you know exactly how much the cost of the build will be and you only need to pay a small deposit up front, with the rest on completion. There are no payments to be made during the build, and your mortgage won't kick in until the final payment is due.

The only downside to a turn key is that finance approval generally only lasts a year, so if the building time goes over this you do run the risk of not being able to be pre-approved again due to finance criteria changing. This can be managed and worked through by your mortgage advisor.


For this type of build (also known as progress payment builds), you need to be approved for your mortgage before the build begins. The funds are then released in stages as each payment falls due. Your builder will let you know when each stage is due, and it is a matter of sending invoices to the bank to get the next payment made.

Interest starts to occur when each payment is made, so your mortgage payments increase with each stage. This can be harder on those who are currently renting as they must pay rent and a rising mortgage, so good income and cash flow is needed here.

Since your finance is locked in when you begin the build, you don’t need to worry about your finance expiring. However, with rising building costs thanks to delays, builds can end up costing more than expected, so if you are looking at this type of build it’s essential to have a decent building buffer there.

No matter which building option you decide on, the team at Better Choice Home Loans can help guide you on your journey. If you are thinking about building, let us talk you through your options and what type of build or finance might suit you best.



bottom of page