154 Families Paid Six-Figure Deposits for Houses That Were Never Built

In 2020, 154 families signed contracts to buy house-and-land packages in Clydesdale, a new estate in Sydney's north. They each paid six-figure deposits — their life savings in many cases. The brochure promised delivery within two years. Modern homes. Family-sized blocks. The Australian dream, packaged up with a glossy render and a payment plan.

Five years later, the land is still empty. Not a single slab has been poured. Not a single title has been registered. The families can't move in, can't get their deposits back, and are now preparing for a legal battle that could drag on for years.

The developer — BHL Group — was delisted from the Australian Securities Exchange in 2022 for failing to lodge audited financial reports for 2020 and 2021 1. The corporate structure involves multiple related entities, making it nearly impossible to trace where the deposit money actually went.

And here's the part that makes me genuinely angry: the developer has reportedly asked some buyers to pay double the original price if they still want the land. The same land they already paid a deposit on five years ago. The same land where nothing has been built.

This isn't an outlier. This is what the house-and-land model is designed to enable.

How the sunset clause became a weapon against buyers

Every off-the-plan and house-and-land contract in Australia contains a sunset clause. It sounds innocuous — it simply sets a deadline by which the project must be completed and settled. If the deadline passes, either party can walk away and the deposit gets refunded.

That's the theory.

In practice, sunset clauses have become a deliberate profit extraction tool for developers. Here's how it works.

A developer sells 150 lots in 2020 at $500,000 each. Construction stalls — sometimes genuinely, sometimes strategically. The sunset date passes. The developer triggers the clause, terminates all 150 contracts, and offers to resell the same lots at 2025 prices: $750,000 each.

The buyer gets their original deposit back (maybe — if the developer hasn't spent it). But they've lost five years of opportunity cost, five years of price growth, and five years of their life. The $500,000 lot they contracted for is now $750,000, and they're back at square one.

New South Wales tightened sunset clause laws in 2015 after a wave of developer abuse in the Darling Harbour and Parramatta apartment markets 2. Victoria followed with similar reforms in 2018. But enforcement is weak, and developers have found creative ways around the protections — particularly in house-and-land estates where the legal framework differs from apartment projects.

"The data tells a different story from what the sales brochures promise," says Yan Zhu, Chief Data Officer at PremiumRea. "We tracked 23 house-and-land estates in Melbourne's west that were selling in 2019. Four years later, 6 of those 23 had significant settlement delays, and 2 had developers enter voluntary administration. That's a 35% failure or delay rate. Would you board a plane with those odds?"

The maths that house-and-land salespeople don't show you

Let me walk through the economics of a typical Melbourne house-and-land package versus an established house purchase. Same budget: $700,000.

Option A: House-and-land package in Tarneit.

• Land: $280,000 (40% of total)
• Build: $350,000 (50% of total)
• Developer margin + marketing + sales commission: $70,000 (10%)
• Total: $700,000

The land — the only appreciating component — is 40% of your purchase. The building, which depreciates at roughly 2.5% per year according to ATO depreciation schedules, is 50%. And you've paid $70,000 in developer profit that goes straight into someone else's pocket 3.

Five years later, assuming 5% annual land appreciation and 2.5% building depreciation:

• Land value: $357,000
• Building value: $308,000
• Total: $665,000

You've lost $35,000 in real terms. On a $700,000 purchase. With 5% annual land growth.

Option B: Established house in Cranbourne.

• Land (600 sqm, GRZ): $560,000 (80% of total)
• Building (1990s brick veneer): $140,000 (20% of total)
• Total: $700,000

Five years later, same assumptions:

• Land value: $714,000
• Building value: $123,000
• Total: $837,000

That's a $137,000 gain — a 19.6% total return — primarily because 80% of your money was allocated to the appreciating asset (land) rather than the depreciating one (building) 4.

The difference between these two scenarios is $172,000 over five years. That's the real cost of buying a house-and-land package instead of an established house on land. And I haven't even mentioned the vacancy rate problem.

Tarneit's vacancy rate has exceeded 3% at various points over the past three years. Cranbourne hasn't breached 1.5% 5. Higher vacancy means lower effective rental yield, longer periods without income, and tenants who negotiate harder on price because they have options.

New estates are not investments. They are consumer purchases dressed up with investment language.

Four red flags that identify a dangerous house-and-land deal

Based on our analysis of failed and problematic estates across Melbourne and Sydney, here are the four warning signs.

1. The developer won't show you audited financials. BHL Group stopped filing audited accounts two years before the Clydesdale disaster became public knowledge. If you're handing over a six-figure deposit, you have every right to ask for the developer's most recent audited financial statements. If they refuse, or if the statements are overdue, walk away. The Australian Securities and Investments Commission (ASIC) maintains a public register of company filings — checking it takes five minutes 1.

2. The sunset clause is longer than 24 months. A reputable developer building houses on titled land should be able to deliver within 12 to 18 months. If the sunset clause extends to 36 months or beyond, the developer is either planning for delays or keeping optionality to terminate and resell at higher prices. Either way, it's not in your interest.

3. The estate is in a high-supply corridor. Tarneit, Melton, Wyndham Vale, Clyde North — these areas have thousands of lots in various stages of development. When you buy into an estate with 500 planned dwellings and there are four other estates within 5 kilometres doing the same thing, your property has zero scarcity value. The developer controls both supply and pricing, and you have no negotiating power 6.

4. Land-to-total-price ratio is below 50%. This is the single most important number in any property purchase. If the land component is less than half the total price, you are buying a depreciating asset. Our minimum threshold at PremiumRea is 80% land value — we won't recommend a property to a client unless the land alone justifies the majority of the purchase price.

"Every time someone tells me they're buying a house-and-land package because it's 'stamp duty free,' I ask them to calculate the opportunity cost," says Yan Zhu. "You save $30,000 in stamp duty. You lose $170,000 in capital growth over five years. That's not a saving. That's the most expensive $30,000 discount in history."

What to buy instead (the boring strategy that actually works)

The alternative to a house-and-land package isn't complicated. It's just not as sexy as a glossy brochure with 3D renders.

Buy an established house on a large block in a suburb with constrained land supply. Target areas where no new land is being released — older suburbs, 20 to 40 kilometres from the CBD, where the housing stock was built in the 1970s to 1990s and every block has already been developed.

In Melbourne, this means the southeast corridor: Hampton Park, Cranbourne, Narre Warren, Frankston, Berwick. The eastern suburbs: Boronia, Croydon, Bayswater. These are areas where the supply of detached houses on 500+ square metre blocks is fixed and declining — every subdivision removes one large block and replaces it with two or three smaller dwellings, reducing the total stock of developable land.

The houses themselves might be ugly. The kitchen might have laminate benchtops from 1993. The carpet might be the colour of old tea. That's fine. That's actually the point.

A cosmetic renovation — full repaint at $6,200, new SPC flooring at $62 per square metre, kitchen handles and splashback at $1,500 — costs $15,000 to $20,000 and typically adds $40,000 to $60,000 to the bank's assessed value within six months 7.

You're buying land value dressed in an ugly wrapper. The 154 families in Clydesdale were buying a pretty wrapper with almost no land value underneath.

The first group builds wealth. The second group funds developer profits.

I don't know how to make this any clearer: if you are considering a house-and-land package anywhere in Australia, run the land-to-total-price ratio first. If it's below 60%, you are making a donation to the developer's bottom line. And if anything goes wrong — construction delays, sunset clause abuse, developer insolvency — you are the one left holding an empty block of dirt that you don't even own yet.

Buy the dirt first. Make sure you own it. Then worry about what sits on top.