Surveying prior to settlement

Discussion in 'Development' started by Mark77, 15th Dec, 2017.

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  1. Mark77

    Mark77 Active Member

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    When putting conditions on a contract for an indended subdivision, what kind of clause do people put into the contract to allow for adequate due diligence that a site is feasible prior to settlement.

    I'm mostly looking at blocks that have subdivision potential but that may not be advertied as such. I don't particularly want to draw the sellers or agents attention to my intentions during the negotiation process. I would however like to get some kind of site analysis done prior to settlement to make sure that council requirements can be met.

    I have spoken to a conveyancer who said I could put in anything from a clause "subject to satisfactory survey" or something similar, right up to "subject to council approval of subdivision". I somehow doubt that most sellers would accept the latter.

    "Subject to satisfactory survey" would allow me get a survey done during settlement period to know whether things look good. It also isn't totally unreasonable to ensure that the existing house has been built within the boundaries. I spoke to one surveyor who said that a basic "identification survey report" could be done for about $1000. This would tell me where the boundaries are and where the existing house sits in relation to these boundaries. Another surveyor said that a full survey would be required but this would cost $2500 - $3000 which is a fair outlay to check feasibility. Obviously if things went ahead this would be required anyway so not money wasted.

    Any advice here?

    Do these amounts sound reasonable for a survey report?
     
  2. Scott No Mates

    Scott No Mates Well-Known Member

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    Surely the purpose of the survey at this stage is boundary definition and encroachments (contours can wait). A town planner will confirm if the block meets the requirements under the LEP for subdivision.

    @bmc
     
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  3. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Get some legal advice.
     
  4. SamK

    SamK Active Member

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    Hi Mark,
    What costs are reasonable depends on where you are in the country. Boundary definition requires completely different amounts of work depending on state, size of block, clear or covered in bush, and age of area.
    I have seen something like "subject to survey the results of which are to the satisfaction of the buyer"
    I would also put in "subject to the owner/s signing applications to Government, service agencies and the like at the buyers request and expense" this will allow you to get started on the applications for subdivision before the settlement date. Nothing worse than getting ownership of the property only to wait months for approvals to do anything.

    I am a surveyor in WA. Clients sometimes ask me to check the area of the yard or set back of the dwelling. If it is obviously not going to work we will stop the survey there, rather than waste your money. For example, buyer needs 350m² in the back yard to fit a new block of land and it is quickly discovered the final figure is going to be more like 260m² (happened yesterday) because of the position of the existing house. There is no point in doing a full feature and contour survey or marking out the boundaries. It is obviously not a retain and build scenario my client was after. As I have looked after them and only charged a few hundred for the call out, I will likely get their next survey, win, win.

    Hope this helps.
     
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  5. Mark77

    Mark77 Active Member

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    Thanks SamK. That makes sense to me. I wish you lived near me - i'm in NSW.
     
  6. Matthew Hughes

    Matthew Hughes Well-Known Member Business Member

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    That's great advice @SamK. If looking at a potential subdivision site, I include the same type of clauses as outlined above by SamK, especially including that the current owner signs the subdivision (or DA) at the buyer's expense to save on holding costs and time. I'd keep the wording simple and single line if possible (playing the potential down but still giving you what you need in the contract).

    If you're not lucky enough to have a surveyor that you work with, another option is to use either Nearmap or even Google Earth and measure the potential subdivision options as an initial check (noting these will be estimates but will you should be able to tell if it's anywhere near density limits) - you will need to have an understanding firstly of density requirements (and setbacks of the retained house etc - which the local council can assist with), but certainly a starting point in your initial checks before engaging a surveyor if you're not sure.
     
  7. Marg4000

    Marg4000 Well-Known Member

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    Your conveyancer is correct. You can put any clause you like in a contract.

    But the more "outs" you give yourself, the less attractive the offer is to the vendor. Many will accept a "clean" contract for a lesser amount over a higher offer with conditions.

    A clause for a satisfactory survey within 7 days is probably acceptable to most, six months (or more) to pursue council approval may well be a very different matter.
    Marg
     
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  8. Mark77

    Mark77 Active Member

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    Thanks. Yes I have done this with the ruler function on the NSW planning portal. It looks feasible from that.
     
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  9. Anthony416

    Anthony416 Well-Known Member

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    If it is a purchase without any near future intent to develop then the following advice does not apply, however if the intention is to purchase the property to carry out some development to value add, then the following would apply as part of the DD.

    Many properties, where the purchaser intends to sub-divide, are marginal in relation to council minimum lot size, so if this applies then an accurate survey is a must.

    Next is to get a feasibility report by a Town Planner on the proposed development. They can outline any potential issues and give some guidance if you wish to proceed. Although it is never 100% certain due to the way council may interpret the rules, it is better than going in blind.

    No, the real estate agent's assurance that the development can be approved is not the basis for a rational purchase.......:)
     
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  10. Scott No Mates

    Scott No Mates Well-Known Member

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    An agent misleading a prospective purchaser? Never..... :rolleyes:
     
  11. Mark77

    Mark77 Active Member

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    When I spoke to a surveyor yesterday asking about this in respect to a particular property he told me that their company were involved in a similar development in the same street. He was looking at the ad and commented that they weren't advertising it as having development potential. Just now I get a call from the real estate agent saying that they just had a call from a new buyer out of the blue who has put forward the highest offer so far. I suspect that this surveyor has pointed it out to another developer. Live and learn...
     
  12. Hamish Blair

    Hamish Blair Well-Known Member

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    How much does Nearmap cost?
     
  13. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    It's expensive.
    Most councils will have an online mapping/GIS portal that the public can use for free. It's great for doing measuring in the middle of the night to determine if going to site and inspect/measure is worthwhile.

    It's not foolproof as it depends on shadows/angle of photo/tree coverage but it does give a very good idea.

    Intramaps is the common one in WA but there are a few other states that use it if their state govt doesn't supply one Digital Mapping Solutions (DMS) | IntraMaps | Web Based GIS Solutions

    You can also measure distances on googlemaps
     
  14. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    PS I pay around $1000 for a contour and feature survey here in WA. It's very comprehensive
     
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  15. Mark77

    Mark77 Active Member

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    Is this report comprehensive enough for your DA or do you get a more detailed one later?
     
  16. jim1964

    jim1964 1941

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    When putting clauses into contracts, they need to be simple, easy to read and understand,or the vendor in most cases will not agree to sign it. I always get a surveyors opinion on a interested site,and the councils planner in most cases( although you will never get a definite yes/no over the counter) and always get the clause the vendor agrees to sign off anything DA related prior to settlement at the purchasers costs.
     
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  17. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    I use it for DA here in WA.
     
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  18. hematite

    hematite Well-Known Member

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    Same, as do I. It's what you need for your planner to commence work.

    I'm astounded by how 'out' some boundaries are off by in Perth (or maybe generally). I spent a bit more and had some boundary re-pegs to check the fencing alignment etc.

    Lots of people try to save money by not getting a proper survey done, when it's a minute amount compared to the build cost. I've seen/heard of lots of encroachments with guttering, installed brick walls etc. Just because the fence is there, doesn't mean that it's in the right spot!
     
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  19. SamK

    SamK Active Member

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    Well said hematite, fences have nothing to do with the boundary, NOTHING!
    People that put in fencers put them in the path of least resistance.
     
  20. Mark77

    Mark77 Active Member

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    A real shame when that fence sits on top a $30k retaining wall built 2m inside your boundary meaning you can't get the required 3m width to gain rear access!
     

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