Subdivision of Land: What You Should Consider before Proceeding

There are multiple potential benefits of subdividing your land into several building lots. In general, when a large tract of land is divided into many lots, you can make more money. Simply speaking, the total price of multiple lots will be higher than the cost of one large piece of property. Subdivision is beneficial if you need to liquidate some of your assets without losing your entire land.

In addition, you can increase the marketability of your property by creating lots which are smaller and affordable to individual buyers. The process of land subdivision often seems straightforward and simple. However, this is not always the case, and poor planning can have negative consequences. Here are the most important factors to consider before starting a land subdivision project.

Regulations

The most important aspect that you should check when considering land subdivision is the local legislation. There are rules and regulations which are in place to prevent the irresponsible division of land. You must evaluate the restrictions in your region of residence which could prevent the success of the plan. For instance, you should know the zone in which your land is situated.

Specific zones have different requirements in terms of minimum lot sizes. If your land cannot be divided to match the regulations, your proposal for subdivision will be denied by the local council. Apart from government regulations, you should also consider other forms of restrictions. For example, neighbourhood covenants and deed restrictions can prohibit subdivision.

Potential Market

When subdividing your parcel of land, legal restrictions are not your only concern. You must think about your potential buyers and how you can tailor the new lots to match their requirements. Simply speaking, your plots will not become marketable just because they are acceptable by the government. Potential property owners will evaluate the lot layouts and sizes.

Therefore, you should invest time into designing lots which are appropriate for the target market. Determine the building plot size and general layout which will make the subdivided units more attractive to interested parties. Also, you should make sure that the proposed lot sizes have good marketability in your area for a good price.

Costs

You should think about the potential cost of your land subdivision project. In general, land owners are charged development application fee when they lodge an application for land subdivision. You might also be required to pay other charges to the local council for infrastructure and plan sealing. Additionally, you will require professional guidance from subdivision contractors, which can be costly.