The thought of getting into developing excites many of us, but the truth is that developing is riddled with hidden traps awaiting the unsuspecting, and for the unwary and inexperienced this can quickly turn into a costly nightmare. Knowing what to look for in a site is the key. This is Part one of a two part series where John Marquez, a property developer, explores the considerations that one should take in to account when looking for a potential development site.

Overpaying for a site that is less than desirable will see you chasing your tail as you try to make up for not only the inflated price you paid, but other cost blowouts that may occur during the process. 

Before looking for a site you will need to know your development strategy and your investing criteria. Your budget will determine your development strategy. This may mean that you can only afford to do a 2 lot subdivision, or keep the existing house and build a unit on the back. A simple land subdivision will be less costly than a larger unit development for instance.

Speak with your Accountant to know what structure you will be purchasing your site under and speak with a Broker to know your lending capacity. These will narrow down your choice and start forming a clearer picture as to the type of sites you will be targeting.

Once you locate a potential site, it is time to commence your Due Diligence or research to determine whether the site has development potential or able to achieve what you are proposing. Below are some of the more important checks you will need to undertake to determine if the site is feasible:

This gives the land a designation with regard to what it can be used for. Each particular zone has a particular rule as to what you can and cannot do with the land, and the requirements for a Planning Approval. Some examples of zones are:

  • Residential Growth Zone  
  • Growth Residential Zone
  • Neighbourhood Residential Zone
  • You can find out more by going into the relevant Council Website.

These will determine if there are any impacts or constraints on the property that may affect your proposal. Examples of these are:

  • Heritage Overlays
  • Significant Land Overlay
  • Design and Development Overlay
  • Again you can visit the Council Website to find out more. Alternatively, your draftee will be able to determine what impacts the overlays may have.

Stormwater: It is crucial that you are able discharge stormwater and sewer off the site.  A lot of this will be determined by the topography of the land, the depth of the pipes that you need to access, and the distance. Contact the relevant Council to get information on depth of the Stormwater Pipe at the point of discharge which is located in the drainage easement. The easement may be located on your property or one of the neighbouring ones. Council will inform you on where you need to connect to. There will be a small fee to request this information from Council.

Sewer: To get information on the Sewer depth and location, you will need to call the relevant Water Authority. Dial Before You Dig is a free online service where you will also be able to source information on the Sewer point of discharge and depth of pit. The title for the property will also have information on this, which the agent should be able to provide.

Once you have all this information, your Civil Engineer will be able to determine whether you are able to successfully discharge off the site successfully or whether there may be complications.

Click here to read part 2 of Considerations when looking for a property development site