FFoundation Finance

Property investment

How house-and-land and construction finance works for investors

A general guide to financing a new-build investment — construction loans, progress payments, valuations and timing. Not tax or financial advice.

5 June 2026 · By Foundation Finance · Last reviewed 10 June 2026

What we can — and can’t — advise on

Foundation Finance operates as a credit representative under an Australian Credit Licence. We can advise on the credit product — the loan itself, how it’s structured, and which lenders suit your situation. Whether a self-managed super fund, trust or company structure is right for you is financial product, tax and legal advice, which sits with your licensed financial adviser, accountant or solicitor. This page covers the credit side only.

Financing a new build works differently to buying an existing property. Here's a general overview of how house-and-land and construction finance works for investors. It's general information about the credit side only — for tax (including negative gearing and depreciation) and any structuring questions, see your accountant.

How a construction loan works

With a house-and-land package, the land and the build are usually funded through a construction loan that releases money in stages (slab, frame, lock-up, fit-out, completion). You generally pay interest only on the amount drawn during the build, which keeps holding costs lower while the home is being built.

Lenders assess the land value plus the fixed-price build contract, so a clear, fixed-price contract with a licensed builder makes the finance smoother.

Off-the-plan timing

With off-the-plan purchases, finance is typically arranged closer to completion, and the lender values the property at completion. Because valuations and your circumstances can change between contract and settlement, it pays to plan the finance early and keep a buffer.

Things to consider

  • Progress payments and cash flow — interest is charged as funds are drawn.
  • Valuation risk — the completed valuation can differ from the contract price.
  • Timing — builds and approvals take time; build a buffer into your plans.
  • Borrowing to invest magnifies gains and losses; values and rents aren't guaranteed.

Use our borrowing power and repayments calculators to plan, and the depreciation estimator for an indicative new-build depreciation figure (a quantity surveyor prepares the actual schedule).

We handle the loan

We arrange construction, house-and-land and off-the-plan finance and manage it through to settlement — see new-build & house-and-land investment finance or start an enquiry.

Who handles what

Getting it right usually means a small team. Here’s who does which part — we’ll gladly work alongside your other professionals.

Us (Foundation Finance)

The loan — structure, features, lender selection, serviceability and the application.

Licensed financial adviser (AFSL)

Whether an SMSF or investing via super suits you, and any financial-product advice.

Registered tax agent / accountant

Your tax position — negative gearing, deductions and CGT for your circumstances.

Solicitor

Legal structures, trust deeds, contracts and asset protection.

Quantity surveyor

An ATO-compliant tax depreciation schedule for your property.

General advice warning: The information on this page is general in nature and factual only. It does not take into account your objectives, financial situation or needs, and is not financial product, tax, credit or legal advice. Tax, superannuation and SMSF outcomes depend on your circumstances — speak to a registered tax agent and a licensed financial adviser before acting. Any estimates or calculator results are indicative only and not an offer of credit, a quote, or a guarantee of approval or savings.

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