What is "Land with building conditions"?

Land with building conditions, as the name implies, refers to land that has some conditions attached to the construction of a building.
Here are some examples of specific conditions.

The building construction company is specified

Land with building conditions is often put on the market by a developer, construction company or real estate company.
And the construction company itself or the developer or real estate company's affiliated construction company is pre-designated as the constructor.
The fact that construction can be undertaken together with the sale of the land is an advantage for the seller.

Deadlines are set before the architectural plans are finalized.

After purchasing land with building conditions, you may be required to sign a construction contract very quickly.
In this case, be sure to check the deadline for determining the building plan.
In most cases, the deadline is within 3 months of the purchase of the land, so the construction contract and building plans must be finalized and ordered by then.

Reference plans are provided

Sometimes a reference architectural plan is already prepared for the house to be built after the purchase of land with building conditions.
The floor plan and facilities of the house are predetermined.
Some people may think that if the building plan has already been decided, it is the same as a ready-built house.
However, a built-for-sale house refers to the purchase of an already-constructed house on the land.
On the other hand, land with building conditions means that a new house will be built after purchase.
The point that you may not be able to freely decide the building company and building plan is similar to a ready-built house, but there are differences as described above.

Process after purchasing land with building conditions

The following is a brief explanation of the process after purchasing land with building conditions:

●Conclude a land purchase agreement
●Decide on an architectural plan
●Conclude a building construction contract
●Start of (construction) work
●Construction completes
●Construction Inspection
●Delivery

The contract is characterized by the fact that there are two contracts, one for the purchase and sale of land and the other for the construction of the building.
As mentioned above, it is important to note that the contractor is predetermined and that a time limit is set.

The advantages of buying land with building conditions

Now let's talk about the merits of buying land with building conditions.

Can be less expensive than regular land for sale

It may be possible to purchase the land at a discount compared to land without the usual restrictions.
From the seller's or real estate company's perspective, it is possible to profit not only from the sale of the land but also from undertaking the building work.
Therefore, since profits can be earned from both the sale of the land and the construction of the building, it is possible to set a relatively low sale price for the land.
In addition, demand for land with building conditions is lower than for regular land because the degree of freedom in building housing is reduced.
This is another factor that makes the selling price less expensive.

The building construction company is already decided for you

Choosing which builder to select is important but also time-consuming and labor-intensive.
However, for land with building conditions, building companies are pre-designated, so there is no need to search for and consider new building companies.
This is recommended for those who do not want to put in the effort to search for a building company.

You can check the construction process of the house

In the case of a ready-built house, the building process cannot be checked because the house has already been completed.
With land with building conditions, it is possible to check the building process of the house, and if there are any points of concern, a house inspection can be conducted on a case-by-case basis.
The advantage of such inspections is that defects can be prevented before they occur.

The construction turn around period is relatively short

When purchasing regular land, after concluding a purchase agreement, you must separately search for a building company and consider building plans.
In the case of land with building conditions, the building company has already been selected and a reference plan is often available.
In other words, the period between the purchase of land and the start of construction can be significantly shortened, resulting in a quicker completion of construction work.

It is easier to get a home loan

When contracts for land purchase and building construction are separate, it tends to be more difficult to pass the mortgage approval process.
This is because the building plan and construction period are not clear, making it difficult for the financial institution to predict the future.
On the other hand, if the land is conditional, the building plan has been determined to some extent, making it easier for the financial institution to make a loan decision.

The disadvantages of buying land with building conditions

Now let's talk about the disadvantages of buying land with building conditions.

You cannot choose your own building construction company

As we mentioned as a feature of land with building conditions, one disadvantage is that you cannot choose the building company.
If you already have a preferred building company in mind, the key point is whether or not you can compromise here.
Of course, you can decide on a building company first, but it is a good idea to search for land and a building company at the same time in order to have more options.

There is not a lot of time to develop design plans

If you purchase land with building conditions, you must also sign a construction contract within a certain period of time after the sales contract.
This means that there is not much time to develop a design plan for the house.
It is important to take this into consideration when making your plans, as you will need to make decisions while discussing with your family and those who will be living with you.

You can't build a house where everything is exactly as you want it.

It is best to assume that it is not possible to build a perfect house that fulfills all your wishes.
It is true that, unlike a ready-built house, a house can be built on land with building conditions after you have purchased the land and you can have a say in the design and implementation.
However, as mentioned above, you cannot choose the building company, and you are somewhat bound by the reference plan for the construction of the house that has already been prepared.
It is difficult to request anything that deviates from the reference plan.
Make sure to check the reference plan in advance before making a decision on whether or not to purchase land with building conditions!

Points to keep in mind when purchasing land with building conditions

This section also explains some of the points to consider when purchasing land with building conditions.
Basically, it is important to be aware of each of the disadvantages already explained before making a purchase decision.
Here is only one point that does not overlap with these disadvantages.

Ensure that building inspections are not neglected during construction

Follow the construction process of the house and make sure that building inspections are performed where necessary.
Sometimes, problems are discovered after construction due to the fact that a thorough inspection was not conducted.
This can cause problems not only in terms of construction, but also in terms of business transactions.

In conclusion

In this article, we have provided an overview of land with building conditions and the advantages and disadvantages of purchasing such land.
Although there are various restrictions on land with building conditions, it is recommended for those who are not so particular about the building company or building plan.
Please discuss this with the person you plan to live with before purchasing, and proceed with the creation of your ideal home!