Does Your Property Have Subdivision Potential?
Subdividing can get a little complicated but if pursued intelligently, it can turn out to be quite the moneymaker for you, as the ROI is invariably very high. You can subdivide in many ways. There are investors who subdivide their property, renovate the part of the plot at the front and sell the land at the back, earning a neat profit through the venture.
A strategy of subdivision
Of course, this way you can tackle the mortgage through the profit made on the sale of land. In addition, the time and risk quotient involved is far lesser just as well. So, this looks all too simple, isn’t it?
Land area: what does the local council say?
For all the good that subdividing your property could bring, there is one fact that stares us in the face: not all lands have subdivision potential. You will also have to speak to your local council and figure out the minimum dimensions of land required for subdivision. Remember, it is different for different states.
Driveway width and slope
Apart from size, which should ideally be more than 700 square metres, there is slope, curb width and frontage to be taken into consideration. Only the size won’t insure you. The driveway is just as important. To elaborate, your home must have ample space between its edge and the boundary of the property for a driveway to exist (and here we are not talking about a cramped driveway area). Including the space which needs to be meted out for landscaping, the driveway width should be in the range of 3.5 metres.
Slope area is crucial because a land that slopes briskly must be more spread out in order to be believed to possess subdivision potential; with slope, the specification of 300 square metres suddenly becomes 400.
Cost of undertaking subdivision
While there are investors who got through the other end of a subdivision project in three weeks, there have been others who have taken as much as two years. I think that six months represents a good median. There are costs of subdivision, demolition, construction to accommodate apart from other contingencies. That means you cannot afford to lack in diligence at any stage.