With land becoming scarce, Melbourne’s developers are pushing plots that might seem like great deals on the surface – but which hide significant issues beneath.
Most people don’t realise Melbourne’s developers are now repurposing land considered unsuitable for homes a decade ago — including blocks with soft soil, uneven terrain (which sometimes looks level), and even those in flood-prone areas.
As a result, homeowners often encounter unexpected groundwork issues (like slab reinforcements or soil removal) midway through construction.
These surprises typically add between $10,000 to $25,000 to a homebuilding project. And if your bank refuses to grant you a loan to cover these costs, you might be left liquidating assets for cash… or have to abandon the project entirely.
This happens more than you’d think.
And while the solution is simple, it’ll only protect you from unexpected groundwork costs if you know about it before signing your building contract.
The Solution: A Fixed-Price Contract
Working with a builder who offers fixed-price contracts is a great way to avoid blowing your budget on unexpected groundwork expenses after construction begins.
But it goes deeper than that.
Any high-quality builder will know the ins and outs of Melbourne’s land issues and will factor them into their initial quote.
They may even visit your block before they build the quote — or at least before construction begins — using soil testing, slope analysis, and drainage assessments to identify any potential challenges early on.
If You Find a Builder Who Does That Under a Fixed-Price Contract…
… hold onto them. You’ll unlock 5 big benefits:
Benefit #1: No budget blowouts. Since your builder has already assessed your land, any groundwork costs — such as levelling uneven ground — will be included in your quote. What’s more, since you signed a fixed-price contract, you can rest easy knowing any additional groundwork won’t cost you a cent.
Benefit #2: Fewer delays. A thorough land assessment can identify potential issues that could cause hiccups down the line, like poor drainage or unstable soil. By addressing these challenges early, you’ll keep your project on track and avoid frustrating delays that can throw off your move-in date.
Benefit #3: Easier loan approvals. Banks like fixed-price contracts because they reduce uncertainty. When a builder clearly outlines all potential costs — like extra soil remediation or footing excavation — it makes it easier for you to get a loan.
Benefit #4: Greater trust. When builders provide clear pricing and take the time to assess your land, it creates a sense of trust. You can feel confident they aren’t just trying to lure you in with a low quote; they genuinely care about your project and want to help you succeed.
Benefit #5: Informed design. A thorough land assessment gives you insight into your unique block before construction starts. This knowledge helps you make smart design choices that take full advantage of your land’s unique features. For example, you could go with a split-level design to accommodate a natural slope.
The Takeaway? Your Builder Makes All the Difference
With land becoming scarcer in Melbourne, partnering with a builder who factors in local land conditions while offering fixed-price contracts is one of the smartest moves you can make.
But there’s more to building a custom home than locking in your costs; you have to set yourself up for success at every step of the way.