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All Land Is The Same, Isn't It?

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  • All Land Is The Same, Isn't It?


    Colm here ...

    I bet a farmer would give you a funny look if you blurted that out. A geologist might do the same and a builder would definitely give you an argument as well.

    Well, surprise, surprise; so would a developer. All four of them would disagree with that statement and all four for totally different reasons, that I hope, at least for the first three, you can work out the reasons.

    When a real estate developer looks at land, I suppose he/she's a bit like the farmer. The developer wants to know how many houses or apartments can be 'grown' on the land or how many 'Lots' can be subdivided from a large block of land.

    So a developer is very interested in the Zoning of the land. The zoning of land is your area is determined by the Local Authority, sometimes referred to a City Hall or the City Council.


    Zoning of land is determined by our elected Civic Leaders, under the
    guidance of Professional Town Planners, when the Town or City Plan is created.

    The Town Plan sets out:

    . Where people will live in a residential area;
    . Where industrial properties will be allowed;
    . What part of the City arte set aside for Parks & Recreation;
    . Where low and high rise residential buildings can be constructed;
    . Where commercial office and business premises will be and so on into
    shopping centers and the like.

    In each zoning category separate rules apply. For example in a 'house'
    residential area, there might be a minimum lot size on which only one
    house can be built.

    The house to be constructed on that lot will have regulations that ensure
    that it will be "set-back" from the front, side and rear boundaries by so many feet or metres.

    It may also limit how high the roof of the house can be, so as to limit
    structures dominating the street landscape.

    Zoning Sub-Categories

    Let's just consider one of the zones mentioned above; Residential. Within this zone there will be several other sub-categories. In my area of Brisbane, single house lots are referred to as 'Residential 'A' zone.'

    However, we also have a zoning called 'LMR - or Low Medium Residential'and this zone allows a 'higher density' of livable units or condos or apartments, whatever they are called in your neck of the woods.

    As people get older and don't want the upkeep of a large family home,
    they may move into LMR style living. Or single people/ childless couples
    are also attracted to this type of accommodation.

    We then have a zone for high rise residential tower development, as well
    as retirement living.

    Land Value

    All of these zones have an impact on the land value, because all of them
    have, not only a different 'usage' but importantly to a developer they
    have a different capacity.

    Example: A residential house lot has the capacity to build only one house.
    An LMR zone has a formula usually, that when applied to the land area,
    determined how many condos, apartments, units, whatever, can be build on the land. Let’s say 6 can be built.

    Can you see, generally speaking, how the value of the house land will be
    less than the LMR land.

    Following on from that, the high rise land with a capacity of 100 units
    will be very much more expensive.

    So if you intend becoming a developer, apart from studying, "Residential
    Development Made Easy," you should visit your local Town Plan and study
    the zoning rules that apply to your area of interest.

    Hope this is of interest.

  • #2
    Hi Colm.

    Really enjoying your posts. Thanks for sharing your knowledge and experience.




    • #3
      Originally posted by Houghie
      Hi Colm.

      Really enjoying your posts. Thanks for sharing your knowledge and experience.


      Thank you very much Houghie - I was not sure whether Forum member interested in investment would find the the development side of things of any interest.

      So I will add a few more articles as time goes by.




      • #4

        really great to have access to your experience in this area, soaking it up. I'm keen to focus more on developing property rather than strickly rentals so this info is a real bonus. I hoping to start my first little development in the next few weeks....gotta be in to win.

        - The early bird may get the worm, but the second mouse gets the cheese. -