Why Should RAAF First Home Buyers Consider House and Land?

A house and land package lets you buy a block and a new build under one plan, but it has more moving parts than buying an existing home. For an Air Force member, the key point is that new builds often unlock extra first home buyer support, and a posting can affect how you use it.

This guide covers what applies to your situation. Rules differ by state and territory, so check the location you plan to buy in. Defence Loans is a defence mortgage broker that works with ADF members, so we deal with these questions often.

Why Do New Builds Attract More First Home Buyer Support?

Many state and territory grants and concessions apply to new homes only. Established homes often miss out.

For example, the Queensland first home owner grant is $30,000 for eligible new homes valued under $750,000. The Northern Territory HomeGrown Territory Grant is $50,000 for first home buyers building or buying a new home. The Western Australian grant is $10,000 for a new home. Queensland also applies a full transfer duty concession to a first home buyer's new home or vacant land, with no price cap, for contracts signed on or after 1 May 2025.

The trade-off is that each grant has its own price limit, residency period and start date. A grant that suits one state may not exist in another. Confirm the rules with the state revenue office before you sign.

Can You Use the 5% Deposit Scheme on House and Land?

Yes. The 5% Deposit Scheme lets eligible first home buyers buy with a 5% deposit, and Housing Australia backs the lender so no lenders mortgage insurance (LMI) is payable. There are no income caps.

Where you buy land and a build under separate contracts, the combined land and build cost must be at or below the price cap for that location. The cap depends on the suburb and postcode, so check Housing Australia's postcode search tool. You apply only through a participating lender, and a broker can help you with that. Our page on the 5% Deposit Scheme for ADF members explains more.

The main trade-off is the move-in rule. For existing homes, you must move in within six months of settlement. For a house and land build, you must move in within six months of the occupancy certificate being issued, and the build contract and construction must meet the scheme's fixed timeframes. You must also keep living there while the backing is active, or the lender may require you to pay LMI. A posting can make that timing tight, so plan it before you commit.

How Does Help to Buy Work for a New Build?

Help to Buy is a shared equity scheme. The Australian Government contributes between 5% and 40% of the price of a newly built home and takes an equity share in return. You make no monthly repayments or interest payments on that share.

You need at least a 2% deposit from savings. A house and land package counts as a new home. The building contract must be with a licensed builder, cover the whole build at a fixed price, and include the mandatory insurances. Land must settle within 90 days of final approval. Construction must start within 12 months of you becoming the registered owner. The build must be finished within 36 months.

There are income limits. From 1 July 2026 they are $103,000 for a single applicant and $165,000 for joint applicants. Income is assessed on the taxable income shown on your Notice of Assessment, which includes salary sacrificed income. Check how your own allowances are treated. Help to Buy participants generally cannot receive help from other shared equity or government loan support schemes. Confirm with a Participating Lender or Housing Australia whether the 5% Deposit Scheme can be used alongside Help to Buy.

The trade-off is that the Government shares in any rise or fall in your home's value. You may also be asked to buy back its share if your income stays above the threshold for two consecutive financial years and you can afford to. Our Help to Buy page has further detail.

What Happens to Help to Buy If You Are Posted Away?

Housing Australia may approve temporary absences, including ADF postings, so contact Housing Australia before you are posted. While the Government holds a share, the home must stay your principal place of residence. You cannot rent out all or part of it unless Housing Australia approves in writing.

This matters for Air Force families, who move regularly. A build can also take many months, and you must move in within three months of completion. Tell your lender about your posting cycle at the start so your plan fits.

Walking Through a Posting-Aware Build

Consider an Air Force member buying their first home on a house and land package in Queensland. They sign a fixed-price contract for land and build, and the combined cost sits under the cap. They use the 5% Deposit Scheme, so they avoid LMI with a small deposit. Because it is a new home, they also apply for the Queensland first home owner grant. The Queensland Revenue Office states that a national scheme does not affect eligibility for that grant.

Their challenge is timing. A posting notice arrives while the build is underway. They talk to their broker early, confirm the expected completion date, and check that they can move in within six months of the occupancy certificate being issued. They also check that construction will start within 12 months and finish within 36 months of loan settlement. The build finishes on schedule, they move in on time, and the government backing stays in place.

In a case like this, the member keeps the grant and avoids LMI. The cost is the loan itself, which still has to be repaid, and a rule that ties them to living in the home for a set period.

How Do Construction Loans Pay Out During the Build?

A construction loan usually pays the builder in stages as work is completed, rather than all at once. This is why repayments often start small and grow as more of the loan is drawn.

As an illustration only, at an example rate of 6.75% p.a., interest on a $500,000 loan fully drawn would be about $33,750 a year before any principal is repaid. During the build you generally pay interest only on the amount drawn so far. Rates vary by lender and deposit size, so use our borrowing capacity calculator to test your own numbers. Our construction loans for ADF members page explains the stages. Getting loan pre-approval before you shop also gives you a clear budget.

Can You Save Your Deposit Through Super?

Yes. The First Home Super Saver scheme lets you release voluntary super contributions towards a first home. You can count up to $15,000 of voluntary contributions per financial year and $50,000 in total.

You can use it to build on vacant land, provided ownership of the land has not transferred to you before you apply for a determination. Released amounts are taxed, and some contributions are not eligible. Speak with your accountant before you make contributions.

Call one of our team or book an appointment at a time that works for you. We will check which schemes fit your build, your posting plans and your budget before you sign a contract.

Frequently Asked Questions