The Acquisition Price

Usually, a build contract will not cover every cost that will be incurred prior to completion of your home. So, with this in mind NewBuild Plan™ will help you assess the total costs required to complete the home before you start construction.

This will include everything necessary to meet local authority requirements, code compliance certification, and the full completion of your home to satisfy the lender’s requirements. NewBuildPlan™ will create reserves – allowances for any additional costs. The total cost including the dedicated reserves is called the ‘acquisition price’.

Example of Acquisition Price

Section $230,000
Build Contract $325,000
Owners Care (Optional) $18,500
Contingency Reserves (Optional) $6,000
Interest Reserves (Optional) $10,700
NewBuild Plan™ Fee $1,000
Inspection Reserves $350
Total Cost*
* “Acquisition Price” or adjusted purchase price
  • The ability to provide these reserves depends on the valuation and the credit criteria of the lender.
  • The ‘purchase price’ for lending purposes is the lower of the two assessed figures – ‘acquisition price’ or valuation’.
  • Any additional value attributed by the valuation is not used as ‘deposit’.
  • If you have owned your section for 12 months or more, any additional equity gained may be used as ‘deposit’.
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