Subdividing situation: what to know before you go to work

Subdividing a property can be a property owner’s smartest investment. However, it isn’t as simple as splitting the land and building a few more homes on it.

Knowing about zoning regulations, subdividing demand, easements and finding the best building lawyers are imperative before you break ground.

Here are some tips for getting it right without (hopefully) any hurdles:

1. Knowing subdividing demand

People often think that the more homes on a property will result in more money being made - but this isn’t always the case. Why? Because the market doesn’t always support a subdivision once it is finished.

You should do your research, finding out whether or not there is a demand for buying or renting subdivided properties in the area. If you find that the area has a surplus of properties of subdivided homes available then it is likely people don’t want to buy them.

2. Know your zoning regulations

If you wish to buy a property with the plan to subdivide, it is pivotal to understand your local zoning regulations or planning schemes that apply to the property (including local council policies).

These regulations will outline multiple stipulations under which you as the new property owner must abide, including minimum land size for subdividing. You have to be aware of these influential elements as it will determine whether the investment is worth it or not.

3. Other potential hurdles

Zoning regulations can provide a potential hurdle to subdividing, but you should also consider the property’s vicinity that may impact your potential build. Undertaking a feasibility report could find potential problems with subdividing the property, including neighbouring sewerage systems which could make further building impossible.

There could also be a host of other obstacles impacting the build, including properties located in dangerous areas (i.e. prone to bushfires), making subdividing impractical in the area.

Finally, look into council requirements regarding domestic construction (not just subdividing), as they will stipulate requirements about property upgrades like building new driveways, something which could make the build more costly.

4. Easements

Easements are outside party rights that grant them permission to use your land for a predefined need. One example of an easement is the use of electrical lines running under the property and the need for providers to easily access these lines in the event of maintenance or repairs.

Property owners looking to subdivide should be aware of any easements attributed to their prospective purchase, as the property owner will have the responsibility placed back on them to ensure that their build does hinder the easements attributed to the property.

This can once again be incredibly costly, especially on smaller properties, as finite measurements have to be taken to ensure the specific easement isn’t encroached upon.

5. Enlist the services of a building lawyer

Of course, one of the best things you can do as a budding property developer is to enlist the services of a reputable building lawyer. They can help you through the process from purchase to completed subdivision, comprehensively explaining your legal requirements and providing expert advice on how to approach your subdivision.

The main thing to look out for when it comes to choosing a building lawyer is experience: have they been providing their expertise for some time and do they have knowledge of the local area?

Having a working knowledge of the region and its property regulations is key to choosing the right building lawyer - they can help you make the right decision with your investment.