Development related questions

Hello everyone

I am bit confused about how dual dwellings, townhouses on seperate lots, and multiple units work, including when it comes to selling them?

Dual dwellings:

I understand dual dwellings are on the same lot, so seems like they would have to be sold together- so I don't see much benefit given rents overall are not that lucrative and capital growth may not be the same ( I am may be wrong). Could some one please confirm if my understanding is correct and what are the benefits of going for this (may be cons as well)

Townhouses:
Most townhouses seems to be on seperate lots. Are there some on same lot as well? If they are, how are they then different from dual dwellings? If these townhouses are on same lot, how does it work, can they be sold separately?

In relation to the above I have also seen two houses on what happens to one main lot number for example 1/30 cbd Street and 2/30 cbd Street. Does this mean they have been subdivided?

Multiple units:

Where I am looking to buy, I have seen multiple units on what seems to the same lot (1,2,3,4,5 etc) Could some one please explain how does this work, and whether these units can be sold separately. Do they need to be subdivided as well ?

I am also keen to know your views on whether for best results, it will be good to subdivide for development, in particular I am looking at 750+ sqm house in a area that encourages high density dwellings. I was thinking of keeping existing house on front which is about 400sqm and either building two or one house (double story is possible as well) at the rear (after subdividing?)

As you can tell by now I have no real estate development experience, what in your experience is more lucrative (should I just go with one-which can get more and cost less) or two ? I know it will depend on particular circumstances but I am very keen to hear any views about this. I appreciate your time, effort and response to my queries.

PS yes I will also talk to relevant town planner but for now your responses are probably going to help me with settling some anxiousness that I have in anticipation of, hopefully signing of the deal. This is also more so because everything seems right with the property but for some reason the vendor (owner seller) had the sold sign on the property from 2019. Given all else seems good indicates possible issues (jacking up the price from last few years- not really keen to sell until the seller gets exceptional money etc) but rather than waiting, I am ok to buy with a little bit premium to get, what appears to be land in a zone with set development potential.

Thanks

 

Land may contain more than one dwelling. Only land can be "sold" with any dwelling attached to that land. You get freehold title to that lot. Larger lots may be subdivided with one or more dwelllings on each "lot". Alternatively property may be subject to a strata interest in which case the buyer acquires a proportionate right and doesnt get a title to land. Just to a title referred to as "SP123456" for example as this refers to their fractional interest in the land (owned by the SP) and the dwelling but specifically to a Govt registered plan that allows the use of Apartment 14 and carpspaces 29 and 30 for example. This is common to villas and townhouses and apartments.

1/30 CBD and 2/30 may be a dual occupancy on one title or subdivided lots. Generally councils may limit each subdivised lot to one dwelling or its a dual occ (2). On one title. The sale contract will contain details and it would make sense to obtain legal advice on what is being acquired.

Dual occs may have land tax benefits eg live in one, rent other and both are exempt. Also land value may be less than two subdivided lots.

The council rules for the approval of dwelling in that area will dictate what is permitted. They may already be a development approval on the site. Sounds like they want a high price. Some people ask top dollar and ignore that a developer should only pay what the land is valued by them for its use. Many people think a $600K lot with a DA is worth $1m and it wont usually have that sort of value addition. The developer has to be able to afford to buy it, hold it, develop it and sell it and then maybe make a profit after paying their silent partner - the ATO what is often 25% or more of the profit in taxe plus GST which applies even if you dont make a profit. Oh and council developer levies and approval fees etc

The more you can build then more likely a profit is. Two lot splitters struugle to make profit. And the more you build the more $$$ you need to have to do it.

 

Thank you for the response.