Subdividing in NSW – a basic overview
Know the planning controls and site constraints
The key planning factors to be considered when looking to subdivide land is firstly the zoning of the land and then site-specific restrictions. In NSW, the Local Environmental Plan (LEP) prescribes whether land within a particular zone can be subdivided. If the zone allows subdivision, the LEP will set out minimum lot size standards for subdivision. The prescribed Minimum Lot Size specify the minimum size that an existing lot must meet in order to be subdivided, as well as the minimum size for newly created lots.
Site-specific restrictions to consider include topography, bushfire prone status, flood prone status, ecological constraints, contaminated land constraints, if it has heritage status and others. These restrictions can prevent a site from being subdivided, or can affect the lot design and the manner in which a subdivision takes place, even if the zoning and LEP controls allow.
The most certain way of knowing Council’s planning controls for a site is by requesting a certificate called a 10.7 Certificate (previously known as a Section 149 Certificate).
If the lot does not meet the Minimum Lot Size standard or the proposed subdivision cannot meet the minimum size for a new lot, it’s a not necessarily a hard no. The NSW planning system provides some flexibility in planning controls by providing the ability for a council to vary development standards in certain circumstances. This requires a developer to make a written application to vary a development standard under Clause 4.6 of an environmental planning instrument when lodging the development application. It must demonstrate that compliance with that development standard is unreasonable or unnecessary in the circumstances of the case.
However, there are some restrictions where clause 4.6 cannot be enacted and it is advised you visit the NSW planning website (http://www.planning.nsw.gov.au) for more specific information.
If you are not familiar with working with planning controls, it is recommended to engage the services of a town planners and/or surveyor who can help you determine the development potential of the land.
Engage a professional team for development approval process
Once it has been determined that land can be subdivided, you will need to a engage a surveyor and town planner. The consulting surveyor will carry out a detailed survey of the land and then prepare the plan of subdivision which your town planner will ensure complies with all development standards.
It is considered good practice to have a pre-lodgement meeting with the local Council. All consultants involved in preparing the development application should attend the meeting including your town planner and others where relevant such as an ecologist or bushfire specialist. The outcome of this meeting will be a list of items prepared by council which need to be addressed when preparing the development application for submission to Council.
Once approved, Council will issue a development consent setting out the total of Council's required contributions with a list of conditions to be completed before Council endorses the subdivision plan. These conditions may relate to provision of water supply, access, power or any item Council considers important. Your consulting planner will explain the development consent to you and point out any particular items which are especially important for you to understand. When the construction of civil works are complete, and the conditions of the development consent have been met, the next step is the Subdivision Certificate application phase.
Obtain your Subdivision Certificate and register with the Land Titles Office
At this stage, the “linen” plan is prepared by the surveyor and submitted to Council for their approval. Council make an assessment of whether all conditions of the development consent have been met to their satisfaction. Once the Council has endorsed its certificate on the subdivision plan and all interested parties have signed it, the Surveyor can have the plan lodged at the Land Titles Office on your behalf. The plan will become registered and title documents issued. The new subdivision is now complete and you are able to transfer ownership of the new lots.
The Main Costs
The main costs involved are the development application costs, constructions costs, infrastructure contributions and plan sealing charges.
Minimum costs for even a minor subdivision can start around $80,000. So while subdivision is one strategy that is great for quick equity gains, it also risky and highly complex.
As an industry standard, $80K / lot is a common budget estimate.
First Steps
You should always do two things to reduce risk:
1. Due diligence and upfront planning where you gather as much information as possible about your site before beginning; and
2. Seek professional help so you don’t make mistakes and can make a greater profit in the long run.
At Sky Planning we can assist you through every stage of the subdivision process - from site acquisition to registration with the Land Titles office.
Contact us today for a free quote or over the phone consultation.
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