Thinking of buying land? 4 things you need to know

Thinking of buying land? 4 things you need to know

Let the classic Latin wisdom of caveat emptor – buyer beware! – guide you in purchasing land. Always get professional independent advice and don’t sign any paperwork before you have checked with your real estate agent, solicitor and the local Council.

Getting connected

Most people will want water, sewerage, electricity and a landline phone connected to their block. If this has not already been done these connections can add substantially to the cost of building. Also check for internet access and mobile phone coverage, crucial if you are working from home.

Easements may not be easy

Vacant land may be subject to an ‘easement’ which means that part your property can be used by someone else for a specific purpose e.g. to gain access to underground stormwater or sewerage pipes. Easements can be minor or major and can affect where you build, your use of the land and its resale value.

Watch out for the ‘envelope’

Land in semi-rural subdivisions may be subject to a quaintly named ‘building envelope’. This makes house construction only possible on a certain part of your block, this may not be where you plan to build.

Tax implications

The Australian Taxation Department view vacant land in two ways: a ‘capital asset’ or ‘trading stock’. If you own vacant land as an individual, for private use or as an investment, it’s usually considered a capital asset. If you sell it you may need to pay capital gains tax. If you use your land in a business activity it’s trading stock and any proceeds from a sale are classed as ordinary income.

If you have a questions, or would like me to write on a specific topic let me know in the comments below…


Ben Everingham


Ben founded Pumped On Property after building a multi-million dollar property portfolio over a 5 year period. His mission is to show you how to replace your income through property investing so you can do what you love…full time.

3 thoughts on “Thinking of buying land? 4 things you need to know

  1. Great post as usual Ben,

    Here’s my tip for rural properties:

    On site waste water is the way to go and if you can put in a compost toilet – it means you don’t need a stp for ‘black water’ and can get away with a simple grey water system – should save $10-$15k plus running costs every year.

    The modern devices are super hygienic and most people would go back to flush afterwards

    Don’t know about the marketability though….

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