Local Council Due Diligence done by property developers

As a property developer I choose the suburbs where I undertake developments very carefully.

If I’m planning to undertake a development to sell at a profit (something I don’t do anymore – I’m a long term holder of the properties I develop) I look for very different criteria than if I’m planning to hold the completed development as a long-term investment.

But more of that in a future blog.

Local Due Diligence

As a property developer once you’ve shortlisted an area with development potential, you then need to understand the local council’s planning scheme and their willingness to allow developments to be undertaken.

A great place to start is by searching the local council’s website where you can usually review and download their DCP (Development Control Plan) and LEP (Local Environment Plan) guidelines.

If after reviewing these you need further clarification then you can visit the council offices and speak with their town planner.

The things I look for include:

1. Planning Policy – what is the council’s attitude to development. Some councils are very development friendly, while others are more restrictive.

I also check to see if there are any proposed changes to their current planning policy, so I’m not caught out by surprise.

2.  Zoning – All councils have areas where they severely restrict or even prohibit development (such as heritage precincts )and areas where they encourage development (often on main roads and near transport and shops.)

And there are areas where they will allow development if it meets their guidelines.

There may be height or density restrictions in different areas within the municipality.

3. Minimum size – is there a minimum lot size the council requires for a development?

4. Floor space ratios – is there a floor space to lot ratio the council requires?

In other words how much open space do they require and how dense do they allow development to occur?

5. What car parking requirements does the council have?

How many car spaces need to be provided for each dwelling and are there restrictions to parking configuration within new developments.

For example, some councils will require cars to drive out of the property in a forward direction (not backed out) which means you will need to provide room for turning within the property.

6. Is there a minimum street frontage required to allow redevelopment? 

7. What setbacks are required by council? This not only relates to the frontage of new developments but setbacks from neighbours on the side.

8. What is the council policy to established trees on properties? Will they allow the removal of trees for new development?

9.  Are there any demolition controls in the area, in particular in relation to heritage properties? While this is relevant in all states, it is particularly relevant in Brisbane.

10.  Are there flood or bushfire controls, or heritage and conservation constraints?

11. What are the council fees and levies for new developments?

12. Are there any other issues specific for that council?

As you can see a property developer has to do a lot of local due diligence long before starting to look for specific development sites.

Interested in getting started in Property Development?

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However it’s likely capital growth will be slow for some time, so it’s worth considering the concept of “manufacturing” capital growth through renovations.

That’s something we specialise in at Metropole – over the years we’ve undertaken hundreds and hundreds of renovations for our clients – some for properties we purchased for them, others for properties they already had in their portfolio.

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Then join why not have an initial chat with the team at Metropole to discuss your option. Please leave your details here and we’ll be in contact.

from Property UpdateProperty Update https://propertyupdate.com.au/local-council-due-diligence-done-property-developers/