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Can I buy vacant land with no intent to build?
Bayley Clarke · Mortgage broker on the road · Last checked 24 August 2026 · 5 min read
The short answer
Yes, you can. There's a lot of lenders that will just accept vacant land. Typically you want to have your 20% deposit plus costs, because a lot of them don't like lending above 80% on land.
Why? You can't generate an income from it and you can't really live on it, so the banks add in a little bit of extra risk compared to a property you're buying to live in. That's the whole answer. The rest of this page is what that extra risk looks like in practice, and the honest maths on whether land with no plan is where your money should be at all.
The 30 second version. The rest of this page is the detail underneath it.
Why a block gets a shorter leash than a house
A house does at least one job for the bank the moment you settle: you live in it, or a tenant pays rent for it. A vacant block does neither. It can't earn a dollar and you can't move onto it, so if the loan ever goes wrong, the only thing standing behind it is someone else who wants a block. Lenders don't say no to that. They just wind the risk dials in.
In practice that means the comfortable middle of the market sits at 80% of the land's value, so you're bringing the 20% deposit plus stamp duty and costs yourself. A lot of lenders will accept vacant land with no build plans at all. The caution is about the block itself: it earns nothing and you can't live on it, so the risk settings are tighter than for a home. None of that stops the purchase. It shapes which lender fits, and that's my job to sort, not yours.
| Home you live in | Investment property | Vacant land | |
|---|---|---|---|
| Income it produces | None, but you stop paying rent elsewhere | Rent from day one | Nothing |
| Can you live on it? | Yes | A tenant does | Not really |
| What carries the loan | Your income | Your income, with rent coming in behind it | Your income alone |
| How lenders see it | Standard | Standard | Extra risk parameters, happiest at 80% or under |
No rent means your payslips carry all of it
This is the part people skip past. An investment property at least earns rent while you hold it. Land brings nothing to the table: no rent, no roof, just rates and interest going out. The whole repayment has to fit inside the income you already have, alongside your current mortgage or rent, your living expenses and every other commitment you've got.
And it keeps mattering after settlement: the land loan is still a debt you carry into whatever you want to do next, with nothing coming in from the block to help hold it up. A block you're not building on doesn't add to your borrowing power. It spends it.
The bill while you wait
While you hold vacant land, everything about it is an outgoing. The repayments are all yours. The council rates keep arriving whether you've visited the block or not. If it's a rural block there may be slashing, fencing or fire management to keep on top of. And there's nothing coming the other way: no rent, no roof over your head, nothing offsetting any of it.
None of that is a reason not to buy land. It's the number to be honest with yourself about before you sign, because the block has to earn its place in your life through what it becomes, not what it pays you. Land is a bet on the future of a place, funded entirely out of your pocket until the future shows up.
When buying land with no plan actually makes sense
There are genuinely good versions of this. You've found the block in the exact spot you want to end up, blocks like it rarely come to market, and you'd rather own it now than watch someone else build on it. You're a year or two away from being ready to build and want the land locked in while you save. Or the land itself is the plan: space, quiet, somewhere the family ends up. I get that one more than most, and one day I'll be making the same call on my own patch.
What those versions share is a real reason attached to a real place. The deposit is genuinely spare, the holding costs fit inside your life without squeezing it, and you can say out loud what the block is for, even if the answer is simply "that's where we're going". If that's you, the lending side is very solvable.
The honest bit: when the money works harder somewhere else
Land with no plan is the slowest dollar in property, and I'd rather tell you that before you own a paddock than after. It earns nothing while you hold it, it costs you every quarter to keep, and it drags on your next application instead of helping it.
So before you buy a block "to get into the market", run the alternative honestly. The same deposit pointed at an investment property buys an asset with a tenant helping pay for it from the first week, and rent on the application when you go again. If the block is the plan, buy the block. If the plan is vague, the land is usually the expensive way to feel like you're moving.
I say that knowing it talks some people out of a loan I'd have written. That's fine. The test I'd give you is one sentence: what is this block for? If the answer comes out clean, go. If it takes three goes to say, park it and let's look at what else the same money does.
Got a block in mind?
Tell me the block and what you earn, and I'll give you the real picture: what you can borrow against land, which lenders are comfortable with no build plans, what holding it costs you in borrowing power, and what the same deposit does pointed somewhere else. If the honest answer is the money works harder elsewhere, I'll say so.
No application, no credit check, nothing on your file. Just the numbers.
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