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Construction loan calculator.

A construction loan is not paid out in one lump. The land settles first, then the builder is paid in stages as the build progresses, so you pay interest only on what has been drawn so far. Enter the land price, your builder’s contract price, the cash you are putting in and how long the build will take.

The calculator shows each drawdown, the interest you would pay while you build and the repayment once the build is finished.

Price of the land

Settles first. Set to $0 if you already own the land.

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How this calculator works.

  1. Your own cash is spent first, on the land and then on the earliest build stages. The loan pays for the rest, so the loan balance starts small and grows with every payment.
  2. The builder’s price is paid in stages as the build progresses, from a building deposit to practical completion. The stage percentages and when each is claimed are illustrative and are listed below. Your builder’s contract sets the real ones. The calculator spaces the stages across the build time you enter.
  3. Interest is charged monthly on the balance drawn so far and is paid as it falls due, not added to the loan. A payment made in one month starts costing interest the next month, so the final payment, at completion, costs none.
  4. When the build is finished the full balance becomes a principal & interest loan over the term you choose, at the same interest rate.

What it assumes

  • The stage schedule is illustrative, not a builder’s contract: building deposit 5%, base / slab 15%, frame 20%, lock-up 25%, fixing 20%, practical completion 15% of the build price.
  • Stage timing, as a share of the build period: building deposit at the start, base / slab 20% of the way through, frame 45% of the way through, lock-up 65% of the way through, fixing 85% of the way through, practical completion at handover.
  • The interest rate starts at 6.44% (the RBA average new variable rate for Jul 2026, adjusted for the 30 Sep rise) and is held constant during and after the build.
  • The starting scenario is land at $300,000, a build contract of $400,000, $140,000 of your own cash and a build of 10 months.
  • Lenders mortgage insurance, valuation and lender fees are not included.
  • Assumptions last reviewed 25 September 2026.

Questions people ask.

How do construction loan drawdowns work?

A construction loan is drawn in stages, called progress payments. When the builder finishes a stage, the lender usually arranges an inspection or valuation and then pays the builder directly. You pay interest only on the amounts drawn so far, which is why the cost starts low and rises as the build goes on.

Do I pay interest on the whole loan from the start?

No. Interest is charged on the balance drawn, not on the full approved amount. In this calculator it starts with the land and your first drawdown and grows with each stage. With the starting numbers the interest while you build comes to about $16,422, and the final payment at practical completion costs no build-period interest.

How much cash do I need for a construction loan?

Lenders set their own limits, so there is no single figure. The calculator lets you enter the cash you are putting in and shows the loan as a share of the total project cost, which is 80% with the starting numbers. If you already own the land, set the land price to $0; the value of land you own is not counted as a contribution here, so the loan shown is what you would borrow for the build.

Are progress payment percentages the same for every builder?

No. The calculator uses an illustrative schedule, listed under what the calculator assumes. Builders’ contracts set their own stages and percentages, and they differ between states and types of build, so use the schedule in your contract when you have it.

What happens when the build is finished?

The loan converts to principal & interest, repaid over the term you choose. Some lenders offer a period of interest-only afterwards. The calculator assumes principal & interest from completion.

What costs are not included?

Lenders mortgage insurance, lender and valuation fees, insurance during the build, variations and cost overruns, and the cost of housing yourself while you wait. Allow a buffer for these.

More calculators.

Construction Loan Calculator | Siare