SUBDIVIDING PROPERTY – THIS IS YOUR GUIDE

September 25 2018

I often get asked to assist landowners who are considering subdividing their property.

This article will outline the basics of subdivision and how you can get started.

THE BASICS:

Consulting the local council to determine the zoning codes for your property is the first step to determining if a subdivision is possible.  Many councils have online mapping tools which can give you an insight into your property zoning.  The residential zoning codes have a minimum and average lot size that needs to be achieved when subdividing which will determine if your subdivision is possible.  Assuming it is possible, it is crucial to be aware of the subdivision costs, be clear on the time the process will take, determine the supply and demand for the end product you are creating in the suburb, and factor in the holding costs (and the loss of rental yield). The market can be very critical if the frontage is too small, the shape is too unusual or the slope makes the building complex. Be clear on what the market is looking for.

After considering the costs and time frames – if the opportunity is looking profitable, then it would be worthwhile consulting with a surveyor.  A survey of your property will identify key features and determine the different levels.  The position of the services and sewer will be vital to determining the possible subdivision options and costs.  Obtaining advice from your real estate agent to determine your subdivision options is invaluable to ensure you are creating a product that is going to be desirable in the marketplace.

Assuming the house is knocked down and a two-lot subdivision is to be created, a general estimate of costs would be approx. $45,000+ (any fencing or retaining will inflate this cost).  This outlay can often be a limiting factor for those choosing to subdivide.  Your application to the WAPC can take up to 90 days to be assessed as they request feedback from other stakeholders such as the local council, water corporation and western power.  If successful in your request, you will be granted conditional approval and be provided with a list of conditions that you need to fulfill.  A typical subdivision usually takes between 6 – 10 months from the start until titles are issued and this timeframe will be dependent on what conditions are placed on your approval and your ability to attend to all the requirements. You may also consider the merits of paying the surveyor a project management fee to coordinate on your behalf.

Considerations when subdividing:

I have bought hundreds of properties for clients (as their buyer agent) which were predominantly land value that would suit subdivision in the future.

For those of you looking at this strategy you should consider the following:

• The lot size.
• The lot shape.
• Knowing the position of the services, particularly the sewer line.
• The supply and demand for land in the suburb; do your research.
• The levels on the block – will retaining or new fencing be required?
• The width of the block – is side-by-side or retain and build possible?

Considerations before commencing the subdivision process:

1. Check the zoning and the local council policy regarding your subdivision potential.

• Can you retain and build front and back or side by side?
• Demolition and create lots.
• Zoning requirements with the local council that need to be adhered to.

2. Is it profitable?

• The price you paid for the property.
• The supply and demand for the product you are creating – ask your real estate agent for a realistic selling price.
• The full subdivision cost.

3. Title options

• Green title vs survey strata lots.

4. Traps to development

• The position of any potential easements such as sewer and power.
• Irregularly shaped land which is complex to fit a house on.
• Street trees, street drainage etc. can all impact on your subdivision design.
• Does the local shire have some restrictions, for example – minimum street front lot widths?

I am regularly asked by property owners about the potential for their particular property.  We provide a complimentary service of the first 3 steps to allow our clients the opportunity to make a fully informed decision before undertaking the project.

Should you see merit in proceeding you will need to engage the services of a surveyor to undertake a feature survey of the property. If you have any questions regarding the process, feel free to fill out the contact form below or give me a call.

We are going to run a free subdivision workshop soon! For more information, please fill out the contact form below.

Rob Walker

0410 144 211