Subdividing your land – process and considerations
Subdivision, also known as 'reconfiguring a lot' generally involves the partition of a parcel of land into smaller portions. Once land is subdivided, a ‘title’ is created for each new portion, which can be separately sold and transferred.
A subdivision may range from the creation of separate titles for a dual occupancy, the partition of a single lot into 2, to a residential development by subdivision into numerous lots, or the construction of strata title units. Reconfiguring may also include merging 2 or more lots into one, or rearranging boundaries between lots without creating a new lot.
The subdivision of land is usually undertaken to optimise its permissible use and generate maximum profit. As a significant investment, it is important for landowners to understand the subdivision process, and receive professional advice specific to the land, their circumstances and investment objectives.
If you are contemplating purchasing land specifically for development, due diligence should be carried out to ensure it is suitable for the intended purpose and the proposed use is permitted. An experienced property and construction lawyer can assist with this process.
The role of council
Local councils are responsible for carrying out the administrative functions of a subdivision approval and certification processes. Councils may also need to consider any objections to a proposed subdivision.
During the approval process, plans may be referred for assessment to other government authorities which may have an interest in the proposal, such as those responsible for services and infrastructure like water, gas, electricity and roads.
The referral process ensures that each authority’s interests in the land or its assets are sufficiently addressed in consideration of the proposed subdivision.
Regulations and processes
Subdivision of land is governed by legislation, regulations, planning schemes, policies and controls administered by local councils and other bodies in each state or territory.
Most subdivisions require approval from the relevant local council - each have specific requirements for matters such as zoning, minimum lot sizes and engineering standards. In Queensland, the subdivision process can be generalised as follows:
- the proposed subdivision is contemplated considering the objectives for the development, the permitted use of the land and governing laws and regulations;
- a surveyor or town planner is retained to prepare a plan of subdivision in accordance with the objectives, legislation and regulations;
- an Application for Reconfiguring a Lot (subdivision) is lodged with the relevant local council for assessment - the application may be subject to code assessment (which is relatively straight-forward) or impact assessment (which requires additional processes including public notification, letters to neighbours, etc.)
- when approved, a Development Permit for ROL issues with conditions regarding the works required to complete the subdivision;
- when works are completed and all conditions satisfied, a plan of subdivision is submitted for sealing - council arranges inspection of the work to ensure compliance with approval conditions, then certifies the works and seals the plan;
- once sealed, the survey plan is lodged with Queensland Department of Natural Resources and Mines for registration.
Can my land be subdivided? Working with your lawyer and surveyor
One of the first steps in a proposed subdivision is ascertaining the type of development permitted on the land. This is generally determined by the land’s zoning set out in local planning schemes. A title search, plan of the land and zoning certificate will provide preliminary information about the land.
The proposed subdivision must also be consistent with local, regional and state planning objectives and policies, and address environmental and other implications such as access to new lots, the provision of open space or other facilities. Consideration will also be given to the capacity for existing utilities, services and infrastructure to support the proposed development.
A property or construction lawyer, in conjunction with your surveyor, will help identify and explain the legal and technical aspects of the proposed development. Your lawyer can also liaise with council and other authorities on your behalf.
The surveyor will prepare a proposed plan of subdivision which may include the creation of various lots, roads, reserves and / or common property. Many plans will also include the creation, removal or variation of easements and / or restrictions to meet statutory requirements and ensure the proposed development is functional.
If the property is acquired for subdivision the net profit will usually be treated as income for tax purposes, but more complex issues arise if the property has been used as your principal place of residence, or as a long term investment, and it is essential that you very carefully consider income, capital gains tax and subdivision, I consultation with your accountant and lawyer.
Subdivision of land involves complex technical and legal processes and draft plans may need to be revised to comply with relevant laws and regulations before works commence.
A property and construction lawyer can help by working with your surveyor, preparing the necessary property documents and explaining important legal and titling concepts.
We have particular expertise and experience in this field both in relation to subdivision of residential and commercial property and strata title subdivisions (whether simple duplexes or complex residential and commercial complexes).