Can you profit from subdivision? When can you sell the backyard? Can you subdivide? Free Site Assessment by Registered Planner.

Can you subdivide your land? Can you profit from a property subdivision?

Before we delve into the technicalities of a subdivision, let's answer the critical question- can you subdivide your block of land?

If you are thinking of retaining the existing home and building a new dual occupancy home  in the backyard, the vehicle access to the rear is important. Your land must be able to  accommodate a 3 metre wide driveway  to service the rear. The 3 metre distance is measured from side of existing house to side boundary (fence in some instances).

 

There are a host of other planning requirements to satisfy including satisfying the standards of Rescode, commonly known as Clause 55.

 

Council will require connection of each subdivided lot to the essential services like sewer, drainage, water, power and so on. Some councils and statutory authorities  may defer this work through an agreement.

 

In  dual occ or unit developments, the zoning, the schedule to the zoning, planning overlays, vegetation, any minimum lot sizes prescribed by council, streetscape/neighbourhood character, title, easements and other requirements  will determine if you can develop and then subdivide the typical suburban block.

For a large block including acreages, green or brownfield sites, the design of the new lots, lot size, zoning, overlays, access, provision of services to each lot and compliance with Clause 56 are some of the planning requirements to be satisfied.

What are the 4 steps to a  subdivision? When can you sell the backyard? Can you subdivide your backyard? Free Opinion.

What are the two common types of subdivision? Read on
 
What are the subdivision costs ? Read on
What are the steps to a  Subdivision? Read on
When can I sell my backyard? Read on
What is the Ultimate development site?
Can you subdivide your land? Complimentary advice. Contact us.

Different types of subdivision- which one is yours?

 
TYPICAL DUAL OCCUPANCY OR MULTI UNIT DEVELOPMENT WITH SUBDIVISION

The smaller development.

 

A dual occupancy developer- often mum and dad investors- may consider subdividing their backyard and release cash from their unused backyard.

 

They might retain and rent out  the existing home, or renovate it  and  or sell it a later stage or live in the new home in the backyard and sell the existing home.There are tax advantages and benefits  for each scenario and we suggest you discuss this with a qualified accountant.

The developer  would need to obtain planning consent ( a Planning Permit) to build a dual occupancy home or more than one new home  in the vacant portion of their block of land and then follow the four steps to create the new subdivision.

To do so, a Planning Application is made to the local council for Development Approval of the new home or homes in the vacant block- and to be safe, accompanied with an application to subdivide. This safety net protects the land owner from any new minimum lot sizes council may introduce in the near future- that is before the Permit to develop the new home (s)  expires.

The Planning Application will contain the relevant drawings ( house plans, elevations (facades), shadow diagrams, a Clause 55 Report and any other reports Council may require)

Duplex or Tandem dual occupancy 

In a dual occupancy development the two units sit side by side each facing the street.

In the typical dual occ, the two houses (units) are  located  one behind another with a driveway servicing the rear unit. The front unit can share this common driveway, or if council allows, have its own driveway which adds more value to each home,

No common property subdivision

Two lot subdivision with no common property resulting in two Torrens titled lots for the  duplex development.

Subdivision plan with shared driveway common property

Plan of subdivision with common property being the shared driveway resulting in 4 Strata titled lots and one common property.

Strata Title and Torrens Title.

In a typical dual occupancy development a block of land is subdivided to create two lots (in a dual occ development) or more lots (in a 3+townhouses) with a common  driveway.  The sharing of the driveway ( called the common property) will result in Strata Title lots with an Owners Corporation.

 

On the other hand if there was no common property, the lots would be Torrens Title with no owners corporation.  Most suburban lots are Torrens Title where access is by way of a public road.

In some instances,  for a corner block or a very wide block of land, each unit  might have its own title with no common property. Such lots  have a Torrens Title.

The Ultimate development site for a small subdivision.
 

What is the Ultimate Dual Occupancy Site in Melbourne for dual occ and townhouse projects?

This is the million dollar question!

The Ultimate Development Site (UDS) should satisfy all  of these characteristics but if it does not is not the end of the world:

 

  • The cost of the  site should result in acceptable development margins. How much is a development site worth?

  • The site width should allow for two crossovers if want a high yielding development. wide sites are great for a side by side duplex or for 2 or more "one behind another" type development.

  • The site length and area should allow adequate north facing open space for recreation and landscaping

  • Corner sites offer tremendous planning and design advantages

  • The site should be close to infrastructure, schools, shops and transport- location is king!

  • The title should be clear of restrictions and preferably without any easements- check for Covenants or Section 173 agreements on title

  • All the essential services should be available onsite or  in close proximity and run in the most advantageous position

  • The site orientation should be perfect so that the amenities of neighbouring properties are not adversely affected by over shadowing

  • The zoning of your land and it's associated Schedule should not be too restrictive

  • The planning overlays on your land should not be too restrictive like heritage, vegetation protection etc.

  • The site should be fairly level to reduce build costs

  • There should be little or no significant vegetation on the site and on abutting sites within say 5 m of the common boundaries

  • A soil test should demonstrate the foundations will not require additional strengthening

  • There should be no encroachments on your title boundary  or by your property on adjoining allotments

  • There should preferably be precedents for similar development in your neighbourhood

  • There should be no planning overlays burden

  • Your local Council should encourage development to meet their housing stock forecast

 

But don't fret if your property isn't the perfect ten. An experienced architect or designer with sound town planning skills and knowledge will get great results from challenging sites. We will get you great outcomes even if the property  is not the Ultimate development site!

Are you ready to find out the development potential of your land? Complete the form below for a Complimentary site assessment- and it's 100% obligation free!

Not the Ultimate Dual occupancy site

The duplex was approved  due to the wide frontage

In this "one behind the other" type dual occupancy the front faces north which creates overshadowing

to the house behind the new  dual occ house in the backyard

When can you sell  these lots?

Ideally after the lots are registered with the Titles office  who issues individual registered titles.

Read on.

How do you obtain the Title to each new lot?

 

The process to obtain the title is as follows :

  • Obtain subdivision approval from Council who will issue a Permit with Permit Conditions.

  • Satisfy those permit condition works- eg connect services like sewer, power and so on.

  • On completion of the works specified in the Permit Conditions Council issues a Certificate of Compliance.

  • A Registered  Land surveyor prepares the Plan of Subdivision in the approved format for certification by council.

  • You or your representative can then lodge the Certificate of Compliance and Plan of Subdivision with the Titles Office and pay the appropriate fee.

  • The Titles Office then issues the legally registered titles and lot plan of subdivision.

Learn more.

Section 173 Agreement.

Alternatively, in some Councils,  you could enter into an 173 Agreement with Council, where the land developer  "promises" to do those Permit condition works at a later stage.

 

The promise will be recorded on title as a Section 173 and can be removed on completion of the permit condition works..

 

You could do the works later, for example when a deposit is paid by a purchaser or share the responsibility  to complete the Works specified in the Permit conditions with the purchaser of the subdivided lot.

 

What are the subdivision costs in Victoria?

 

The subdivision costs are generally over and above the cost to construct the new dual occ or townhouses on he land. Ask your builder if they have allowed for these costs.

In 2018, in  a typical dual occ development , the construction cost will depend on the level of finishes, inclusions, facade materials, roof type (tiled roofs are generally less expensive) ease of build  (a flat block is easier to build on and requires less or no retaining walls compared to a sloping block).

Build costs alone  can be upwards of $1000/sqm for basic single storey to $1350 upwards for a double storey.

Subdivision costs- to connect services, driveway and crossover construction- can be around $10,000 upwards depending on location of existing services, length of driveway and so on. A recent 5 lot subdivision costs around $45,000 over and above building costs for the five units.

Read on.

SUBDIVIDING LARGER BLOCKS OR BACKYARDS

Alternatively, if the land is sufficiently large or the local Council is supportive of a straight out subdivision, without the need approve  the individual house plans, Council  may consider the  subdivision under Clause 56.

 

In this instance, once the lots are legally created,  the land owner can  sell the vacant portion of the block to a purchaser who will build the new home or homes.

In a Torrens Title, larger blocks of land will be carved out into smaller blocks with generally no common property. Each lot will be serviced by a council owned road which adds significant costs to the development.  Houses/lots  will be numbered, for example as  1,2 3 etc. Brownfield Road  - a road which the developer will create, build and handover to Council to manage. These lots command higher prices as each lot pays individual rates and share no costs to maintain common property.

Each lot must be connected to services and drained in accordance with council requirements.

Roads are wider and built to a higher standard, being a public road. Nature strip, landscaping and street lighting will add costs and reduce developable lot sizes.

The developer  can sell the lots in a larger sized development  prior to registration of titles but will advise the purchaser the titles will be issued in future when they have met Council's subdivision conditions at which stage.

A large estate can also be subdivided into Strata lots  with each lot sharing common property. As a result common property cost are shared among the individual lot owners. Driveways in strata lots  are narrower and more cost effective to build.

In either scenarios services are required to be connected to each lot or "delayed" through agreement with Council. 

 

What is the subdivision process? Learn more

Can you subdivide your land? How many lots can you create? What type of subdivision will apply to your land? Contact us for an obligation free and confidential response.

Or call our Founder direct on 0448 170 132 for an opinion.

 
 

Subdivision Costs

Property development costs

Land Purchase Price

Stamp Duty

Finance Application Fee

Conveyancing cost

Pre Purchase Reports

Council Application fee

Council Contribution Fee

Marketing costs

Agents Fee

Legal fees

Interest rate

Holding cost for Land

Interest on Construction loan

Tax if applicable on Profit

Soft and Construction Costs

Land Survey

Soil Test

Architect/Designer

Structural Engineer

Civil Stormwater Engineer

Traffic

Arborist

Landscape Designer

Construction documentation

Other Reports

Project Management fee

Subdivision cost

Council Application fee

Council Contribution Fee

Electricity fee

Drainage fee

Demolition

Build Cost

Landscaping

Driveway

Fencing

Letterbox etc

Subdivision Costs.

There are a number of items to consider.

The following are some of those costs you must budget for.

All of them might not apply to your subdivision.

These costs are approximate and could increase at any time.

  • Approximate contribution fees payable directly to Council. Usually applies to more than 2 lot subdivision and varies from council to council. It can be 5% of the land cost and more.

  • All costs and fees  shown on this website are approximate and  to be verified by the land owner

 

 

First stage:  Council ( fees applicable at 2017, are approximate  and to be verified)

 

$1278            -             Council (subdivision approval fee)

$  650              -          Sewerage contribution  (if you have commenced building this has already been paid)

$  650              -           Water supply contribution  (if you have commenced building this has already been paid)

$3400              -           Per Power pit – serves up to 6 units. May need more depending on configuration of development (if you have commenced building this has probably already been paid)

$3500 varies            -  Drainage contribution (applies in some Councils where no on site detention is required)

$  600              -          Telecommunications (NBN) report (to be provided by an authorised and accredited Telstra contractor)

$2000              -           Sec. 173 agreement (generally only required if titles are required prior to completion of development)

$5,000             -           Bond per lot for any incomplete works

 $TBC              -           Land Surveyors fees for Re establishment survey and drawing up the Plan of Subdivision

 

 

Second stage:  Land Registry

 

$ 944.80         -           Land Registry registration fee

$  800              -           Solicitor/Conveyancer

$  400              -           Bank endorsement fee (if mortgaged).

$600 TBC       -            Land surveyor  fee per lot to be pegged

 

The above fees,  whilst approximate, apply generally to a subdivision.

 In some cases however, fees may differ substantially from the above.   

Contacting your servicing authorities and local council  with a specific address may give you a better indication of the fees.   

Bear in mind in the event  titles are required prior to commencement/completion of building, (this may be achieved via a Sec. 173 agreement in some councils)  council or an authority may require certain works (e.g. drainage and sewerage works, common driveways, crossovers, power pits etc.) to be completed or bonded.

The Process.

There are several stages involved with the Subdivision. They are summarised as follows:

​​

  • Apply for a  planning approval  for subdivision. When the permit  is granted it will contain  conditions which must be satisfied.

  • Council also certifies the plan of subdivision, which legally approves the subdivision under the Subdivision Act 1988

  • Thereafter the Applicant must meet the Permit conditions (eg installing the required services like sewer, power etc or  building crossover if required under the Permit). On completion  Statement of Compliance is  issued. 

  • A registered surveyor draws up the subdivision plan which is certified by Council.

  • Your conveyancer or representative can then lodge the  certified Plan of Subdivision and Compliance Certificate with  Land Victoria, which allows new titles to be issued for each lot created under the subdivision.  Read on for More information.

When can you sell the new lot?

Technically you can sell the new lot(s) after they are registered with Land Victoria which issues the titles to each new lot created.

However, if you are not prepared to do those essential works required by the Planning Permit condition ( eg installing sewer, water, telecomms , connecting to storm water discharge point and other services to new lots, creating driveways or crossovers)  a purchaser who maybe a builder could  be interested in purchasing the backyard prior to each lot being registered with Land Vic and negotiate a price  with you where  the builder carries out the works required by the Conditions of the Permit and obtains the Certificate Of Compliance. You can then register the lots.

Or you could enter into a Section 173 Agreement with your council promising to do those essential works in future. This

promise would be registered on your title so a prospective buyer will be aware of the condition.

 
 
 
 

 

Building the new dual Occupancy or triple occupancy home at the back.

When a parcel of land is proposed for subdivision, several steps must occur.

 

They include:

• A planning permit must be issued for the proposed subdivision; and

• The plan of subdivision must be certified by the relevant council; and

• The plan of subdivision must be registered by the Registrar of Titles.

The issue of a building permit relies on there being an allotment which is identified on which the building work will take place.

 

Fortunately, 'Allotment' is defined  the Building Regulations 2006  (r 105)  as 'land that can be disposed of separately under the Sale of Land Act 1962 (SLA)(s8A) without being subdivided'.

Section 8A of the SLA then sets out various categories of land that can be dealt with without being subdivided. It includes  'any land under the operation of the Transfer of Land Act 1958. This implies it  is a lot on a plan of subdivision certified (or registered under the Subdivision Act 1988) and which is not the subject of a later registered plan'.

 

Certified plans and registered plans are defined in section 3 of the Subdivision Act 1988.

  • An allotment for the purposes of the Regulations therefore includes a lot on a plan of subdivision that has been certified by a Council, even though it has not yet been registered at the Titles Office.

   

[also states it can be 

  • A certified plan is 'a plan certified by a Council for lodging in the Office of Titles for registration'.

  • A registered plan includes a plan registered or approved by the Registrar of Titles.]

 

A building permit may be issued to build on an allotment on a plan of subdivision once the relevant council has certified the plan, even though it has not yet been registered by the Registrar of Titles.

 

However, all other requirements of the Building Act 1993 and the Regulations must be satisfied.

 

One must note that a building permit cannot be issued prior to certification of the plan of subdivision by the council.

Property development through Subdivision
 

AuArchitecture's Founder is a Registered Melbourne Planner and affiliated with the Australian Institute of Architects, Planning Institute of Australia and Victorian Planning and Environmental Law Association.

 

This collective synergy gives us the competitive edge over competitors, who may only be designers or town planners. The synergy will deliver significant efficiencies and advantages for your project as we manage both architecture and town planning in house.

We are a team of Registered Professionals including Building Practitioners and Architect.

 

Our collective experience amounts to several decades of hands on work- from designing built forms to preparing planning and building permit applications, real property  development and construction.

SUBDIVISION

 

A certificate of title for individual allotments will not be issued until the plan of subdivision has been approved or registered by the Registrar of Titles. 

The normal steps involved for a subdivision is as follows:

  • APPLY FOR PERMIT

  •  Apply to Council for Application for a Planning Permit to Subdivide

  • Application may need to be advertised in local paper and advice adjoining owners

  • Referred to nominated agencies (Referral Authorities)

  • Referred to Technical Services, Building, Environmental Health and Strategic Planning for comment.

  • Council to consider the application and Issue Planning Permit with Conditions or refuse the permit

  • CERTIFICATION OF PLAN

  • Owner appoints a Licensed Surveyor to prepare a plan of subdivision. (2 hard Copies – Formal Plans)

  • Apply for Application for Certification - Form 1 (This form advises Surveyor who this application will be referred to)

  • Referred to nominated agencies that have conditions on Planning Permit 

  •  Referred to Technical Services, Building Environmental Health and Strategic Planning for their approval. (Only if there is conditions from their department)

  • A plan will be Certified when the conditions on the planning permit have been met or arrangements have been made to meet those conditions, along with any other matter set out in Section 6(1) of the Subdivision Act.

  •  The Certified plan to be lodged at the Titles Office. Steps Statement of Compliance.

  • FINAL RELEASE

  • Completed the entire requirements on the planning permit – all referral authority and Council conditions have been met.

  • Before a Statement of Compliance can be issued, written advice from a Licensed Surveyor must be provided to the Council in a prescribed form. This should be to the effect that the subdivision including all lots, roads, common property and reserves) has been marked out or defined.

  • The Statement of Compliance to be lodge at the Titles Office for new titles to be issued.

More on Subdivision

In my  KNOWLEDGE  BLOG  I wrote an A-Z of property development including commonly used terminology.

I should have added P for Permeability (  aka under the radar as New Garden Area introduced by the current Planning Minister  which  reduces building  building footprint to allow for more permeable surfaces. This area depends on the land size and for the average 650sqm block it is 35% of the land, which excludes driveways or any landscaping under 1m in with.)

 

And S could stand for Subdivision.

 

What is a Subdivision?

Subdivision is the creation of one or more lots of land from a single parcel of land with each  lot having its own registered title.

 

S is also for Strata Title in a  Plan of Subdivision

C could be for that all important word Costs.

The cost to subdivide the bloc. for example you may be doing a dual occupancy and creating two blocks from one  parent" block you currently own.

 

After the cost of construction of the new dual occ home, you should allow for Subdivision Costs. They include the cost of the new driveway to the new house, any footpaths and crossings, connections of all services like sewer, water, electricity, telecomms and so on. The length of the run of these services also matters. Then there is the cost of the Land Surveyor and fees  payable to register the title.

 

I would suggest a number of $8000- $10,000 upwards. In a dual occupancy subdivision, chances are your new lot will be a Strata Lot.

In a brown filed site for  26 lots, subdivision costs are in the range of $60,000 -$80,000  and depending on a number of factors including site slope ( more earthworks) laying out 18m wide public roads with footpaths, lighting and landscaping  thereby creating Torrens Title.

 

A strata titled subdivision would sell for less and the public roads could be narrower driveways.

 

The  registered land surveyor will draw up  the Plan of Subdivision in accordance with identified lot boundaries. Once registered you as the owner of each lot is within your rights to dispose of your lot independent of the other lot owner(s).

 

T is for the types of Titles 

 

In a typical dual occupancy or apartment/unit type of development, titles are generally Strata where each of the owners share some common property. These could be say the common parking area, common/shared driveways or easements.

 

Often a Strata title could mean the "air space" containing the unit!

In a Torrens Title the lot owners are independent and do not commonly share common property as the Road is now a Public road.

 

D could be Development Costs.

 

I often get asked the question how much should I budget for the actual Build. That cost varies and depends on site access, constraints, slope, location of services, finishes of materials, area of building, double or single storey, brick of weather board cladding... and the list goes on.

 

As a general rule you can allow approximately $1000/sqm for something basic in a single storey construction to as high as you want to go with product selection. An upmarket luxury  build could set you back by $3000/sqm for a double storey dwelling.

In a typical suburban dual occ  or two town house development  allow $1350+  per sqm for a double storey home or around $1700 including  site costs. An average 3 bedroom townhouse  will cost $250,000 upwards per unit plus the Subdivision costs.

 

Today we costed four dwellings- each containing 3 bedrooms. The build price came to around $1,150,000. Finishes were standard and each dwelling was double storey with a garage.

In a lower cost 5 unit development ( each with 2 bedrooms and being double storey)  the total cost came to about $1 million including site costs. So as you can see the cost depends on a number of factors.

.

AuArchitecture Melbourne

Mail only : #223, 2/134 Pascoe Vale Road ,Moonee Ponds 3039.

E:  Contact us

 

M:  0448 170 132 call me direct -7 days  from 9am to 7pm for the best advice on dual occupancy subdivision, custom home design, commercial projects  or town planning matters. 

 

                                                                                                                                                                                                                      

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We would love to serve you through smart and beautiful  designs for your dream house, dual occupancy, townhouse or apartment projects or commercial and industrial buildings which makes  a difference.

I recall doing a

  • large multi unit  residential design with a sky-street on the fifth level for the kids to play in safety while  creating  a real sense of community living and  

  • a modular home design which grew with the family budget rather like a series of plug in components and 

  • the windmill house with views where each stair landing led to a different view and function and

  • right down to designing and obtaining planning permits for practical traditional designs to meet the family  or developer's budget and objectives.

Our Founder has  worked on hundreds of development sites for dual occupancy and townhouses. He worked on commercial, health, education, retail and leisure projects to name a few other disciplines.

Our professional designs are flexible to suit your vision and realistic to meet your budget.