Due to rapid population growth in Victoria, the Urban Development Institute of Australia has predicted the state needs to build 60,000 new homes each year for more than ten years. With property developers on the hunt for land, could you be sitting on a gold mine?
We spoke to Ed Farquharson – Managing Director of property development company Moda, and David Sorgiovanni – Development Manager at PDS Group to find out more about what they look for when assessing sites for development.
Ed comments, “Many of the factors we consider initially are invisible. Underlying planning scheme controls such as zones and overlays are the main factors when assessing the development potential of a particular property”.
A zone is a planning tool which classifies land, based on what it can or can’t be used for. Zones will ultimately dictate future use of a site and “act as a vital piece of information when looking at acquiring new land for development” says Ed.
David adds, “Finding out the planning zone of any given property is the first step. It quickly tells us what type of development can be built on that site, for example, is it in commercial, residential or industrial zoning?”
If your home is in a suburban area throughout Victoria, it will likely be in one of these zones:
NRZI – Neighbourhood Residential Zone – Schedule 1
To recognise areas of predominantly single and double-storey residential development. To manage and ensure that development respects the identified neighbourhood character, heritage, environmental or landscape characteristics.
GRZ2 – General Residential Zone – Schedule 2
To encourage development that respects the neighbourhood character of the area. To encourage a diversity of housing types and housing growth, particularly in locations offering good access to services and transport.
RGZ2 – Residential Growth Zone – Schedule 2
To provide housing at increased densities in buildings up to and including four-storey buildings. To encourage a diversity of housing types in locations offering good access to services and transport, including activity centres and town centres. To encourage a scale of development that provides a transition between areas of more intensive use and development and other residential areas.
While all properties are categorised into zones, many are also subject to specific planning overlays.
Some properties may be affected by one or more planning overlay. Each overlay gives specific controls that can directly affect the potential development of a piece of land. These overlays may be there to protect heritage, manage flood-prone areas or provide strategic design controls for future development.
Ed discusses “While there are a multitude of overlays, not all are restrictive and some provide helpful insight into what the Planning Scheme expects for the future built form”.
“Once we know what overlays we are dealing with; we can look into the details of that property more specifically. For example, not all heritage overlays are the same and can differ in severity. This can range from a low lying stone wall, a street-facing building facade or in other cases an entire building being Heritage protected”, says David.
Land size is the most obvious factor when it comes to developing a site. “Any freestanding home on 300 sq m or over may have development potential, but typically the bigger the land parcel the more options you have,” says David.
Ed specialises in boutique multi-residential developments, for this “the site needs to be 800 sq m at a minimum and 1000 – 1500 sq m is ideal.”
The length of the street frontage is also important. “It is difficult to get design efficiency with sites that are too skinny, particularly as many zones require setbacks and consideration to adjacent properties. From a car parking perspective, an 18m + street frontage allows for a basement car park with a full turning circle’’ adds Ed.
Even if your property is smaller than 300 sq m, there have been many cases where owner-occupiers on smaller lots, or even in an older block of units, join together with their neighbours to sell in one line. It’s never been a better time to get to know your neighbours!
Location is one of the most important factors in any property decision.
“Location is a strong consideration when looking for a development site. A ‘good location’ is one that typically offers a strong lifestyle proposition for future purchasers. The closer to amenities, transport and employment hubs the higher the underlying demand and future re-sale potential of the end product”, says David.
Discovered you’re sitting on a gold mine? What are the next steps?
If you’re selling your home, make sure the Real Estate Agent understands the aspects that will be appealing to a developer so they can market your home appropriately.
If you are happy in your home but wouldn’t be against a developer knocking on your door and offering you a few million to take it off your hands, then claim your property on Landchecker. You will be able to see when developers are interested in your property and perhaps sell it off-market.