Are you looking to see if you can subdivide your current property or trying to find an investment property that can be subdivided?
This is the first post in a two part series that walks you through the steps and tips, which you should consider in order to identify the key facts about a property e.g. lot size, zoning, overlays, neighbourhood plans etc. From these facts you can start applying the subdivision planning approval process of your local council.
What is classified as subdividing?
It is important to note most states and councils use “reconfiguration of lot” interchangeably with subdividing. In the most common cases subdivision covers the following:
- creating multiple lots from subdividing the original lot;
- merging multiple lots into one lot;
- creating an easement e.g. shared driveway to access lot from a road;
- modifying the boundaries of a lot;
- volumetric (can restrict height or depth of an easement);
- creating or joining a community title scheme; and
- leases of subdivision (typically requires agreement greater than 10 years).
What are the steps in subdividing?
On paper subdividing sounds like a fairly straightforward process with compelling investment logic and in some instances it can be. However there are cases where complications can quickly bring a development unstuck and leave you with a financial burden not easily resolved.
Therefore before you start to draft new development plans for your principle place of residence (PPOR) or purchase an investment property with the intention to subdivide, I would recommend following these steps.
1. What is the applicable planning scheme in relation to the property?
Each council will have its own planning scheme that governs property requirements within zones and whether or not a property lot can be subdivided. On top of this there is additional variants that come into play as to what level of assessment applies and the conditions that need to be met.
I like to investigate a property in two basic stages:
Zoning, lot size, and dimensions (frontage)
These three factors are standard determinates across the country.
- Zoning will quickly help you establish what purpose a property can be used for (residential, commercial, industrial, etc), as well as at a top level if subdivisions are contemplated by council in that area;
- Lot size will help you establish if a block is big enough to subdivide in the first instance. Allowable lot size varies based on zoning of the property; and
- Dimensions are placed on most subdivisions with minimum frontages, widths or plot sizes by location (front or rear) being required for any new developments.
Note. At this stage I would recommend talking to a town planner.
Unless you are an experienced developer, most investors will benefit from the advice of a qualified town planner saving you time, stress, and potentially money. Typically town planners will provide at minimal cost (or free), advice and feasibility on a lot subdivision. You should expect to pay more significant fees once the preparation of a development application begins.
Overlays and neighbourhood plans
These two factors will vary across property lots within zones, taking more investigation to establish if a subdivision is an option or stacks up financially.
- Overlays I like to view as specific constraints applied to a lot. They cover areas such as easement requirements (shared driveways), property height restrictions and heritage considerations; and
- Neighbourhood plans I view as covering: where subdivisions can occur within a neighbourhood e.g. within 200m of a centre area or public transport; what property types are allowed e.g. duplex, apartments, house etc; flood plain restrictions; and aesthetics that need to be met to fit a neighbourhood’s character.
The next post in the series ‘Can I subdivide my property: Required services and creating value?’ covers what services need to be connected to a new lot in a subdivision as well as associated costs and search tips.