Things you need to know about land subdivision

Auckland’s population has increased significantly and is expected to continue increasing over the next 10 years. The increased population together with other determinants make Auckland one of the cities worst in the world given the extremely high house prices coupled with moderate wages. Accordingly, recent market trends indicate that medium to high density housing developments will play an integral part in the current and future development of both the metropolitan centre and the urban periphery of the greater Auckland region.

IMG_5805 (2)Therefore, many investors are now looking at medium to high density land subdivision developments. However, subdivisions are a costly exercise and the process is often very lengthy. The following is an overview of the important things investors should consider before purchasing land for the purpose of subdivision developments:

1. First of all, an experienced property lawyer is required to check the title of the land to see whether there is any legal restriction on the title prohibiting the proposed subdivision;

2. A planner is also needed to ascertain District Plan Rules that may apply and the type of application that will be required;

3. Usually it is also important to have other technical reports done before you proceed further, such as geotechnical reports, contamination reports, flood plan assessment and so on, as it will give you an idea about the potential cost of subdivision for your feasibility study;

4. Once there is a positive outcome from steps 1-3 above, the next step is to employ a representative such as a registered surveyor to draw up a scheme plan i.e. a proposed subdivision. The representative will liaise with Council and make an application for a subdivision consent to the Council on your behalf;

5. Please note the consent will be granted subject to conditions in most cases, such as contributions, engineering conditions, hazard avoidance/mitigation, esplanade reserves and so on;

6. The next thing is to complete conditions of subdivision consent, obtain the 223 & 224(c) certificate for the purpose of getting the Certificate of Title issued.

Please note this is only a brief overview of land subdivision process and we strongly recommend you engage experienced professionals to investigate your proposed development property carefully as the costs associated with each subdivision project will vary from property to property. The cost of such advice will be peanuts compared to the cost if things go wrong because no proper due diligence was undertaken.

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