Have you thought about how to go about subdividing land? If so, you’re right there, along with lots of other everyday landowners.
Or, you might think that you don’t have the money to achieve a subdivision.
There’s no shame in thinking that. In days gone past, property development, including subdivision, was something that rich people did. Picture suit-wearing, briefcase-carrying, fast-talking businessmen.
Yet, like any activity that generates wealth, soon, regular folks started catching on.
Now, everyday landowners like you are taking this opportunity to maximise the value of their land. Property development is no more restricted to those with money, power, and influence.
In this helpful article, we’ll share nine tips for everyday landowners who want to learn how to go about subdividing their land.
First, we’ll share a few reasons why you might want to subdivide. Then, we’ll get into the meat of it. Read on to find out more.
There are a few reasons why you might want to do a subdivision build.
In most cases, it is to maximise the value of your land.
Suppose you have a house on a block of land valued at $800 000 – the average house price in Australia currently.
If you sold it, even if you owned it outright, you would get that sum and not a cent more. However, imagine if you built two townhouses on the land and subdivided them, allowing them to be sold separately. Each could sell for $750 000. Now, of course, you’d have some upfront development costs and the construction costs.
Yet by selling these two, you would see more profit than if you just sold your house.
For others, subdividing a property is a chance to gain an investment property while staying in a beloved area. Other people may want to care for family, so they subdivide to allow parents to move in behind them.
You can see the range of reasons why subdividing and doing something like a dual occ might be a great idea.
Now, let’s explore how to go about subdividing your land.
Tip 1 on How to Go About Subdividing Your Land – Surveys
Without fail, a subdivision will always start with land surveys – prior to starting your town planning process. You want to engage a professional surveyor to undertake a few land surveys. This person will use specialist measuring tools to assess your land.
They will first do what is called a re-establishment survey. This process will determine your property dimensions, which are essential to the subdivision process. They are essential because they will determine the lot sizes of the new blocks of land.
Then, the next task the surveyor will undertake is a subdivision plan. This will occur a few steps later, but we’ll include it here for simplicity’s sake.
This document will state the boundaries of the new dwellings and show each new lot’s titled land size.
It will also show common areas if any. These might be shared outdoor areas or the visitor’s parking spaces.
Tip 2 – Engage an Architect or Draftsperson
Your next step is to find an architect or a draftsperson for designing the new townhouses. Your re-establishment survey is essential here because they will base the designs on the dimensions determined there.
These professionals will need to stick to all the local zoning regulations and local government guidelines. This can vary from area to area, so they must understand this. You might want to do your own research here.
Tip 3 – Lodging the Designs
The next step is to lodge the drawn-up plans with your local government’s town planning team. They will respond with a “request for additional information” (RFI) before approval. The onus is on you to get them what they need, so don’t dawdle.
In property development, delays cost money, and if you’re the one developing, then you’ll be losing money here. As the aim is profit and wealth creation, do everything in your power to avoid a delay.
Tip 4 – A Word on Timelines
You might wonder about how long a subdivision process takes. There is no concrete answer here, unfortunately. As subdivision is a parallel process to the construction of the homes, it can take six months to a year.
As with any significant project, some will take longer than others. Delays are common, but as we mentioned, you need to avoid them at all costs. Delays can also be out of your control so you need to be aware and be prepared.
Other errors can delay the subdivision process, such as errors in paperwork and required resubmissions. Care and consideration can avoid these.
Tip 5 – Select Your Builder
Let’s keep learning how to go about subdividing your land.
There are plenty of builders out there. Each one wants your money. You need to create a shortlist of possible builders to use.
You’ll choose between your volume players and your small, independent townhouse builders. There are pros and cons to each.
In addition, your project will be one of hundreds for them. They may not be able to offer excellent customer service and close oversight of your project. However, they may be able to offer cost savings that a smaller a duplex builder can’t match.
Whereas your small, independent home builders are hungry for business. They can offer exceptional customer service and often higher quality work than the volume players.
Once you have your shortlist, you need to invite them to bid (or tender) for your project.
This means they will propose a total cost for your project, which you need to consider with the rest of the process.
Tip 6 – Online Portals
Some states in the country will have a digital portal that can assist you in lodging paperwork, obtaining approvals, and issuing permits.
These tools can sometimes generate a checklist for you to make sure you are doing everything correctly.
Once everything is done, the relevant authorities will issue you a compliance statement that means you can go ahead with the subdivision.
Tip 7 – Engage a Conveyancer or Property Solicitor
Now it’s time to engage a conveyancer or property solicitor/lawyer. Their job is to lodge the compliance statement and the original title of your land with the title office.
This authority will then issue you with your sparkling new registered titles.
What this means is that you can sell each new townhouse on its own titled lot. Without this, you can’t sell the new homes or even occupy them or lease them out.
Tip 8 – Have Funds Available
We’ve described multiple different professionals and processes that you need to follow here.
Each one will have its own schedule of fees and charges. In addition to this, the local council will also sting you for application fees and admin fees.
In addition, the designs of the new townhouses will also cost a decent chunk.
While you might be able to obtain property development finance for the construction, you have to foot the bill for all the other costs. You will need some capital available for all of these expenses.
Tip 9 – Consider Engaging a Project Management Company
Now for our last tip on how to go about subdividing your land.
If you’re reading this and it looks like too much work, that’s fine. Not everyone has the appetite, patience, and time (a precious resource) to dedicate to subdivision.
Here at Little Fish, we partner with everyday landowners who want to try developing their land but don’t have the time or desire to manage everything.
In this article, we’ve shared nine tips for everyday landowners like you who want to learn how to go about subdividing land. Including the cost to subdivide land.
We’ve covered it from surveys, designs, town planning applications, and selecting a builder. Follow these tips if you are considering your own subdivision project.
And remember, we’re here at Little Fish on standby to help. Partnering with us is easy; just get in touch.