Is a house and land package one contract or two?
It can be either. A split package has land and building contracts; a single contract bundles both. If you're buying to rent through a split package, the land deposit on an unregistered lot sits in trust. On that package's building contract over $20,000, the law caps the builder's deposit at 5% before work starts and adds a 5-business-day cooling-off.
In a split package, the land and the build are separate contracts, each governed by its own Queensland rules.
By Kayla Dale, Senior Property Manager and Sales Agent, FAA Property. Last reviewed 6 October 2026. Reviewed against ATO guidance, 6 October 2026. General information only, not tax, legal or financial advice. Get independent legal and tax advice on any package before you sign.
This is a Queensland guide for investors buying a house and land package to rent out. It reads the package as two legal documents, a land contract and a building contract, and sets out the rule that governs each: where your deposits sit, how much a builder can take before work starts, how the price can move after signing, and when each cooling-off runs. Each rule is cited to an official Queensland or Commonwealth source, checked on 6 October 2026. FAA Property sources house-and-land investment property across South East Queensland. FAA Property Pty Ltd is a licensed Queensland real estate agency, OFT licence 4220395.
Split contract or single contract: what changes for an investor
In a split package you sign two documents. One buys the lot from the developer. The other hires a builder to put a house on it. A single contract puts the land and the build in one document with one price.
This guide follows the split structure, where Queensland law draws clear lines. The land half, on a lot that hasn't been registered yet, sits under the Land Sales Act 1984. The build half is a domestic building contract under Schedule 1B of the QBCC Act 1991.
The two can look alike in a brochure, so check the contract pages, not the price sheet, to see which one you've been offered. Signing a single contract? Which law governs one that bundles land and build wasn't confirmed for this guide, so ask a Queensland property lawyer before you sign.
One rule gets mixed up. If a builder splits the build itself into several contracts that could have been one, the law treats them as one building contract priced at the total. So cutting the build into smaller contracts doesn't change which deposit cap applies; it's worked out on the total price. That rule covers building contracts only. It doesn't join a land contract to a building contract.
In a split package the building contract stands on its own, with its own paperwork. When that paperwork reaches you affects when the building cooling-off starts, covered below.
Buying to rent? You pay a land deposit, settle the land, then pay the builder as the house goes up. Nothing earns rent until the end of that chain. For the package side, see how house and land packages work.
| Land contract (proposed lot) | Building contract | |
|---|---|---|
| Main law | Land Sales Act 1984 | QBCC Act 1991, Schedule 1B |
| Your deposit | Paid into a trust account held by a law practice, real estate agent or the public trustee | 5% of the contract price at most before work starts on site, for work over $20,000 |
| Payments after that | Settlement, which must happen within 18 months of signing or you can end the contract | Only for work done on site, in proportion to its value |
| Cooling-off | Residential sale contracts generally have 5 business days and a 0.25% penalty; confirm whether it applies to your land contract | 5 business days after you receive a copy of the signed contract |
| Cost to pull out in cooling-off | 0.25% of the purchase price, where sale-contract cooling-off applies | $100 plus the builder's reasonable out-of-pocket expenses |
The land contract: registration, the 18-month limit and sunset clauses
If the lot hasn't been registered, it doesn't exist yet as a separate lot. It's created when the plan of subdivision is registered. That's the event package marketing calls 'land registration', and there's no lot to settle on until it happens.
Your land deposit is paid into a trust account held by a law practice, a real estate agent or the public trustee, and it stays there until someone becomes entitled to it.
The seller must settle within 18 months of the day you sign. If 18 months pass without settlement, and not through your default, you can end the contract by written notice before settlement.
What the seller must disclose before you sign is covered in buying off the plan in Queensland.
For a package, one part of the 2023 Land Sales Act reforms matters most. A sunset clause can't end your land contract automatically, so a late registration doesn't let the developer simply take back your lot. How sunset notices work, and how to answer one, is in the same off-the-plan guide. Those rules are under review: no published outcome was found when we checked on 6 October 2026, so check the current law before you sign.
The building contract: the 5% deposit cap and claims tied to the build
The building contract must be written, dated and signed by both of you before work starts. For work over $20,000 the builder must give you the QBCC Consumer Building Guide before you sign.
For a contract over $20,000, the most a builder can ask for before starting work on site is 5% of the contract price. The cap rises to 20% only where work done off site, such as prefabrication, is more than half the contract price.
What counts toward the deposit
Under the QBCC Act, deposit means any payment the builder asks for or receives before work starts on site. That includes the home warranty premium, which the builder collects from you and pays to the QBCC. Add up every pre-start payment and hold the total against 5%.
Pay more than the lawful deposit and you can't get the extra back through a home warranty claim for refund of deposit. That cover, compulsory for residential work over $3,300, includes non-completion, subject to limits. More on home warranty and capital works on a Sunshine Coast package.
Progress claims follow work on site
After the deposit, a builder can only claim amounts tied to the progress of work on site, in proportion to the value of that work. The QBCC gives a plain test. The builder can't claim more than 50% of the contract price, deposit included, until at least 50% of the work on site is done.
The QBCC recommends linking payments to clearly defined stages so you can check each one. Live interstate? That's when to get someone on site. Paying a claim early, or paying more than the contract says, reduces your home warranty protection.
Where the price can move after you sign
A package price holds only as far as the building contract holds it. The QBCC advises a fixed-price contract, rather than a cost-plus or construction management contract, to stay fully covered by the warranty scheme. Then look in these places.
Provisional sums and prime cost items
A provisional sum is the builder's estimate for work it can't price exactly when you sign. A prime cost item is a fixture or fitting not yet chosen or priced. Both are allowances, and the final cost can come in above them. The builder does warrant each was worked out with reasonable care and skill, including using what it could reasonably learn about the site.
Foundations data and site costs on an unregistered lot
Before signing a contract involving footings or a slab, the builder must get foundations data for the site, such as soil tests and site fall. Sign without it and the builder generally can't charge extra later for what that data would have shown.
The exception matters for package land. Where the builder can't lawfully get onto the lot before signing, the contract can go ahead without the data if it guarantees no price rise because of it. Check whether the contract records foundations data or, if the builder couldn't get onto the lot, guarantees no price rise because of it. If site costs appear as an open allowance instead, ask your lawyer how s 31 of Schedule 1B to the QBCC Act applies.
Variations in writing
A builder can't start variation work until you've agreed to it in writing. The document must describe the change, its date, any expected delay and the price change, and you can't be required to pay the increase before that work starts.
The QBCC says undocumented variations frequently cause budget blow-outs and building disputes. Keep every one. Stamp duty is a separate cost again; see stamp duty on house and land.
FAA Property earns a commission from builders and developers when a property purchase proceeds.
Two cooling-off clocks, and the legal advice trade-off
The building contract has its own cooling-off period. You can withdraw within 5 business days after you receive a copy of the signed contract. The QBCC says the clock starts the day after you get the whole signed contract, plans and specifications included, plus the Consumer Building Guide for work of $20,000 or more. Late documents push the start back.
To withdraw, give the builder a written, signed notice saying you withdraw and naming the section of Schedule 1B you rely on. A phone call to the sales consultant doesn't count. Withdrawing costs $100 plus the builder's reasonable out-of-pocket expenses.
The land side runs on different rules. Queensland residential sale contracts generally have 5 business days of cooling-off and a 0.25% termination penalty. Confirm whether that applies to your land contract. The detail sits in cooling-off on a Queensland sale contract.
Now the trade-off in Schedule 1B. You lose the building cooling-off if, before signing, you got formal legal advice about the contract, or you tell the builder you did. You also lose it on a repeat contract on much the same terms for the same site. Plan around that. Get the lawyer's review done before you sign, because that review is now your chance to walk away. So book the lawyer early.
Holding costs between land settlement and first rent
In a split package you own the land for the whole build, before there's anything to rent. The ATO's vacant land rule decides how that stretch is taxed.
Since 1 July 2019, a person who owns vacant land generally can't deduct the costs of holding it. There are exceptions, such as land held by a company or used in a business. Holding costs include interest on money borrowed to buy the land, land tax and council rates. See land tax on investment property for the state side.
Land still counts as vacant while the house can't lawfully be occupied, or can be occupied but isn't yet rented or available for rent. So handover alone doesn't switch those deductions on.
The ATO's own example follows Giovanna, who settles on vacant land and then takes out a separate construction loan. She can claim the construction loan interest but not the interest on the land loan, because interest tied to building a structure isn't a cost of holding land. Any credit assistance is provided by other FAA Group companies, not by FAA Property. Credit assistance is provided under Australian Credit Licence 388789, which authorises credit services only. FAA is not a lender.
From 1 July 2027, negative gearing on residential property is limited to new builds. It's law, in Schedule 2 of the Treasury Laws Amendment (Tax Reform No. 1) Act 2026. Whether a given package counts depends on the legal definition, so read what counts as a new build rather than assuming. There's more on new build investment property in Queensland and negative gearing explained. For the cash side once a tenant moves in, read positive cash flow property.
General information only, not tax or financial advice. Talk to a registered tax agent about your own position.
Reviewed against ATO guidance, 6 October 2026
- Plan of subdivision registered, lot created
- Land settlement, within 18 months of signing
- Building contract stages, claims tied to work on site
- Practical completion
- House lawfully occupiable and rented or available for rent
What to check before you sign either contract
Hold both contracts against this list. Anything you can't tick is a question for the seller, the builder or your lawyer.
- For an unregistered lot, the land deposit goes into a trust account held by a law practice, real estate agent or the public trustee.
- Land settlement must happen within 18 months of signing, and you know your right to end the contract if it doesn't.
- You have the approved survey plan, or the seller must give you the registered plan at least 14 days before settlement.
- The builder appears on the QBCC licensee register. If you can't find them, they may not be licensed.
- The building contract is written, dated and signed, and you got the Consumer Building Guide before signing.
- It's a fixed-price contract, rather than cost-plus or construction management.
- Every payment before work starts on site, warranty premium included, adds up to 5% or less.
- Progress claims are tied to defined stages of work on site.
- The provisional sum and prime cost schedule is attached, and you've read it.
- The contract shows foundations data was obtained, or guarantees no price rise because of it.
House and land package questions
Are there hidden costs in house and land packages?
Costs that can move after signing sit in named parts of the building contract: provisional sums, prime cost items, site costs and variations. Provisional sums are the builder's estimates for work it can't price exactly at signing, and prime cost items are fixtures or fittings not yet chosen or priced, so either can end up above its allowance. The builder warrants they were set with reasonable care and skill. Site costs turn on foundations data, so check whether the contract guarantees no price rise from it. Variations need your written agreement and can't be charged before the work starts. The QBCC says undocumented variations frequently cause budget blow-outs. Stamp duty is separate; see stamp duty on house and land.
How much money do I need for a house and land package?
There's no single figure. A split package has two deposits, protected differently. On an unregistered lot, the land deposit is held in a trust account. The build deposit is capped at 5% of the contract price for work over $20,000, and every payment the builder takes before work starts on site counts toward it. Pay more than the lawful deposit and you can't recover the extra through a home warranty refund-of-deposit claim. Any credit assistance is provided by other FAA Group companies, not by FAA Property. Credit assistance is provided under Australian Credit Licence 388789, which authorises credit services only. FAA is not a lender.
Are house and land packages a good idea?
No guide can answer that for you, but the contracts let you test a package before you commit. Ask for a fixed-price building contract, which the QBCC advises to stay fully covered by the warranty scheme. Look the builder up on the QBCC licensee register. Check the land contract's deadline: the seller of a proposed lot must settle within 18 months, and a sunset clause can't end the contract automatically. Then get independent legal and tax advice on the specific package before you sign either contract.
Are house and land packages worth it?
There is no general yes or no, and one factor is how long holding costs run before rent starts. In a split package you settle the land, then build. Until the house can lawfully be occupied and is rented or available for rent, the ATO treats the land as vacant, and a person, as opposed to a company, generally can't deduct the costs of holding vacant land. Those costs include interest on the land loan, land tax and council rates. From 1 July 2027 negative gearing on residential property is limited to new builds; whether a package counts turns on the legal definition. General information only, so check your position with a registered tax agent.
This guide can tell you what Queensland law asks of each contract. It can't tell you how a particular package is structured or how its timeline runs. That's in the package documents. FAA Property sources new-build and house-and-land investment property across South East Queensland. Request available house-and-land options to see what's on offer, then hold each contract against the checklist above. FAA Property earns a commission from builders and developers when a property purchase proceeds. The strategy session itself costs you nothing. Because we're paid by the supply side, you should weigh our recommendations with that in mind.
Request Available House-and-Land Options