Property Development Tips: How to Make Profit through Land Subdivision
If you are planning on developing your land for profit, you should think about subdividing your block. As implied, this practice involves dividing a large tract of land into smaller pieces or lots. The subdivision process is beneficial because it allows the development of the smaller plots independently of each other. The project can also make your block of property more marketable. Selling large pieces of land can be challenging. Additionally, you can make more profit cumulatively by selling smaller lots than the entire large tracts. However, if you want to make the highest profit, you must make the right decisions during the development process. Here are some practical tips to help you handle the land subdivision work.
Know the Best Application of Land You should think about the best development options to maximise the potential and value of your land before commissioning subdivision. You cannot randomly divide the property into your desired pieces, according to your preferences. Remember, that there are regulations and rules on the size of lots acceptable in different zones, their design and general application. You must determine the best way to increase your property's potential within these rules. For the best results, you should consult a planner to help you identify the type of dwellings that can be built and the number of lots that can be created from your current property. Also, you should inquire about clauses on lot variation and design flexibilities.
Understand the Subdivision Costs Land subdivisions are not simple. Multiple procedures must be followed before your property can be sectioned into independent lots. The involved work will require significant financial investment. Therefore, you should calculate the total costs and determine whether you can afford to perform the project without financial problems. In general, you will need to account for the land surveyor fees. This expert will conduct cadastral surveys and create suitable subdivision plans. They will also be responsible for lodgement of application and subdivisions clearance. In addition, you should calculate the local authority application fees and add the connection fees for utilities.
Decide between Lot Holding and Selling Finally, you should make the right decision on selling or holding the subdivided lots for the best profit. Immediate sale of the pieces will provide a quick profit. This option is favourable if you are in need of funds. Holding the lots will allow for future capital growth, increasing the total returns. If you cannot decide between the two, you should consider selling some lots and holding others.