Construction Loans in North Brisbane: Building Your Dream Home Made Easy
If you need home, car or business loan help, just get in touch here.
Looking to build a new home in North Brisbane? Construction loans can make your property goals a reality, step by step, brick by brick. These loans are specially designed for people building a house, not buying an established one.
If you're planning to construct in North Brisbane, understanding how construction loans work is crucial to avoid delays, budget blowouts, and unexpected setbacks. In this guide, we’ll break down the essentials of construction loans in North Brisbane, explain the loan structure, and show you how Kelly Brothers Finance can help you every step of the way.
Let’s dive into what you need to know about building your home with confidence.
What is a Construction Loan?
A construction loan is a type of home loan tailored for people building a new property or undertaking major renovations. Unlike a traditional home loan, where the full amount is released at once, construction loans are paid out in stages.
These stages are known as drawdowns and align with the different phases of your construction project, like laying the slab, building the frame, and final completion.
Each stage must be completed and inspected before the lender releases the next payment.
Key Benefits of Construction Loans
- Interest-only payments during construction
- Pay as you build; helps manage your finances
- Custom-built home designed to your needs
- Save on stamp duty by only paying for the land
- First Home Owner Grant could reduce upfront costs
These benefits make construction loans ideal for first-time buyers and growing families in North Brisbane.
How Do Construction Loans Work in North Brisbane?
In North Brisbane, construction loans follow a progress payment system. This ensures builders are paid after each milestone is finished and inspected.
Here's how the stages typically work:
- Slab Stage – Pouring the concrete foundation
- Frame Stage – Building the home’s frame and roof
- Lock-Up Stage – Installing doors, windows, and external walls
- Fixing Stage – Plumbing, electrical, internal fixtures and fittings
- Completion Stage – Final touches, painting, and cleanup
You only pay interest on the amount drawn down, not the full loan amount upfront. This staged approach helps you manage cash flow and avoid overpaying too early.
Fixed-Price Contracts vs Cost-Plus Contracts
When applying for a construction loan, most lenders in Queensland prefer fixed-price contracts. Why? Because they limit the risk of cost blowouts.
- Fixed-Price Contract: You agree on a set price with your builder. The lender knows exactly what they’re funding.
- Cost-Plus Contract: You pay for the actual building costs as they occur, less predictable and harder to finance.
In most North Brisbane developments, fixed-price contracts are the standard, especially when applying for a loan.
How Much Can You Borrow for a Construction Loan?
Lenders assess your borrowing power based on your income, expenses, deposit, and credit score.
Generally:
- You can borrow up to 95% of the property’s final value (with Lenders Mortgage Insurance).
- A 20% deposit gives you better rates and avoids LMI.
- Your borrowing limit will include both land and construction costs.
It’s smart to include a buffer of 5–10% for unexpected costs.
What Do You Need to Qualify for a Construction Loan?
Applying for a construction loan in North Brisbane isn’t too different from a regular home loan, but there are a few extra boxes to tick.
Here’s what lenders usually need:
- Fixed-price building contract from a licensed builder
- Council-approved building plans
- Detailed building timeline
- Proof of income and employment
- Clear credit history
- Deposit or equity (usually 5–20%)
Each lender may have slightly different criteria, so it’s important to get advice tailored to your situation.
Step-by-Step Guide to Applying for a Construction Loan
Getting a construction loan might seem overwhelming at first, but it’s a straightforward process when broken down into clear steps. With the right support and preparation, you can stay on track from start to finish.
1. Speak to a mortgage broker – like Kelly Brothers Finance
Start by getting expert advice tailored to your goals. A broker will assess your situation and recommend the best loan options.
2. Get pre-approval – based on your financial situation
Pre-approval gives you a clear budget and strengthens your position with builders. It also shows you’re serious and financially ready.
3. Find land or choose a house and land package
Secure a block of land or opt for a developer package. This is your foundation, literally and financially.
4. Obtain building plans and fixed-price contract
You’ll need a licensed builder and council-approved plans. Most lenders require a fixed-price contract to control risk.
5. Submit full loan application with documents
Now it’s time to lodge your application. This includes your financials, ID, builder contract, and plans.
6. Loan approval and settlement of land
Once approved, your lender pays for the land (if not already owned). This is when your loan officially begins.
7. Progress payments are released to the builder at each stage
As each stage is completed, your lender releases payments. You only pay interest on the amount used so far.
8. Move in when construction is complete!
Once your home passes final inspection, it’s time to collect the keys. You’ll then switch to regular principal and interest repayments.
Working with an experienced mortgage broker ensures each of these steps is handled smoothly, reducing delays and stress along the way.
Common Mistakes to Avoid
- Not budgeting for unexpected costs
- Choosing an inexperienced builder
- Applying without pre-approval
- Underestimating the timeline
- Ignoring government grants
A reliable broker can help you avoid these common traps and secure a stress-free loan process.
Why Choose Construction Loans in North Brisbane?
North Brisbane is booming with residential developments and infrastructure upgrades, making it an attractive location to build a home. Key reasons to opt for construction loans in this area:
- Strong property growth in suburbs like North Lakes, Chermside, and Albany Creek
- Affordable land prices compared to inner Brisbane
- First Home Owner Grant eligibility in Queensland
- Customisation flexibility, build exactly what you want
- Reduce rent pressure by moving in on completion
Construction loans allow you to build smartly and gradually, with peace of mind at each stage.
Why Work with Kelly Brothers Finance?
As trusted North Brisbane mortgage brokers, Kelly Brothers Finance brings over a decade of industry experience. We work with a wide network of lenders to find you the most competitive construction loan tailored to your needs. Our team handles the paperwork, negotiations, and follow-ups so you can focus on building.
Plus, we understand the North Brisbane market—from North Lakes to Aspley—and can recommend builders and developments in the area.
FAQs
What’s the difference between a construction loan and a regular home loan?
A construction loan releases funds in stages, while a regular home loan provides a lump sum upfront.
Can I use a construction loan to buy land and build later?
Yes, some lenders offer land + construction packages. You'll need a plan to start building within a set timeframe.
How long does construction finance approval take?
It typically takes 2–4 weeks, depending on your documents and builder contract.
Do I pay interest during construction?
Yes, but only on the funds drawn so far, helping manage your budget more effectively.
Can first home buyers use construction loans?
Absolutely. You may also be eligible for the First Home Owner Grant and other Queensland incentives.
What if my builder goes over budget?
It’s vital to have a fixed-price contract. Any cost overrun may need to be paid out-of-pocket.
Do I need a broker for a construction loan?
Not required, but highly recommended. Brokers help you compare options, handle paperwork, and negotiate better terms.
Final Thoughts

Construction loans in North Brisbane give you a practical and flexible way to build your dream home from the ground up. With staged payments, interest-only options, and government support for first-home buyers, these loans offer real benefits for new builds.
Working with Kelly Brothers Finance means having experts by your side, advising, supporting, and securing you the best deal from day one. We’re proud to serve the North Brisbane community as trusted mortgage brokers.
Got questions or ready to apply? Give us a call at 07 3847 9450 or visit www.kellybrothersfinance.com.au to get started.