Planning Overlays and Residential Property Development – Developer Explains

Are you considering undertaking a residential development project but lack confidence in your understanding of planning overlays?

Well, stick around because in this article I’m going explain planning overlays in a way that will make sense.

I’m then going to break down the various overlays and what they mean to your development.

Let’s get into it.

When looking at a development site, the first thing you need to consider is its residential zone.

Ultimately, you’re looking for a zone that encourages the type of development you’re looking to undertake.

The second thing that you need to consider is planning overlays. Planning overlays are designed to control land development.

It’s important to point out that planning overlays are different to planning zones.

All land falls under a planning zone, but not all land is subject to planning overlays.

Planning overlays are specific to the land that your property is located, and they directly impact what you can and can’t do with the land.

In Victoria there a many overlays. They range from erosion and bushfire risk right through to the Melbourne airport environs overlay.

But in this article, we are going to focus on the ones that we encounter each day as residential property developers working in and around Melbourne. These include:

  • Heritage overlay (HO)
  • Special building overlay (SBO)
  • Vegetation protection overlay (VPO)
  • Significant landscape overlay (SLO)

Heritage overlays (H)

heritage overlay

Heritage and built form overlays are about preserving the heritage values of existing buildings.

This could be the building itself or could be specific parts of the building your need to preserve.

As a property developer, depending on your risk appetite, I suggest you avoid heritage overlays where possible.

Particularly with what we do here at Little Fish.

We aren’t looking to put square pegs into round holes. Our development strategy is all about low risk, and high returns, so navigating heritage overlay requirements doesn’t make sense.

Special Building Overlay (SBO)

special building overlay

This overlay relates to areas prone to overland flooding.

Its purpose is to set appropriate conditions around finished floor levels which address the flood risk potential of a site.

The key as a dual occupancy or townhouse builder or developer is to be aware of the overlay ahead of time so, and expected costs related to complying with the conditions set out can be factored into your feasibility.

We recently completed a project that we picked up off a client mid-way after they were experiencing all sorts of issues related to potential flooding.

The entire design needed to be lifted by 300mm at the 11th hour.

This had a massive knock-on effect on the entire project and its overall outcome costing significant time and money.

It was a perfect example and reminder of how important it is to be aware of these overlays and the relevant conditions ahead of time and how costly they can be if you aren’t.

Vegetation Protection Overlay (VPO)

vegetation protection overlay

This overlay applies to land with significant vegetation that requires preserving and protecting.

In a nut-shall, if your development site has a lot of significant vegetation, this overlay will impact what you do and don’t have the ability to remove.

This is something you need to be aware of ahead of time before you start making big decisions on a site’s feasibility.

If there is said overlay on your site, you need to work with an arborist to understand the impact it will have on your development, if any.

Significant Landscape Overlay (SLO)

significant landscape overlay

This overlay is all about protecting and managing significant landscapes.

Its purpose is to identify significant landscapes and conserve and enhance their character.

Again, the conditions outlined in this overlay will directly impact what can and can’t be removed—ultimately affecting what can be achieved on your site.

It is important to note that SLO’s don’t mean a line through the site straight away.

It is possible to develop in accordance with the relevant requirements, but all sites and situations are going to be different.

Once again, though, it’s something that needs to be identified and considered at the very beginning of your due-diligence process.

This will avoid unwanted and costly surprises and will save wasting time and resource.

Ultimately, planning overlays have great potential to complicate your project.

Particularly early on, when you’re trying to determine the feasibility of a site.

It is vital that you do your own research on what overlays are specific and relevant to the area you are planning to undertake your development project in.

There’s no question that they are both necessary and essential to maintain the neighbourhood character and to avoid unsuitable developments.

They also make sure that what is built is suitable for the site conditions, which can only be a good thing.

Wrapping Up

Are you still confused? Why not reach out to our expert team of property development consultants and development project managers.

We would love to hear from you 1300 799 277.

development project managers

peter kelly

To put it mildly, Peter Kelly is enthusiastic about real estate. When he’s not looking at properties, or visiting potential sites, Peter can be found online at realestate. com. For him, it’s more than a job – it’s an obsession. Peter is a co-founder here at Little Fish Property developments.