Do I have to subdivide to build?

[Curious]

I've got a rental with 900m2 section where the house is on one side and the other side is a vacant backyard. I want to do "something" with the spare land. It's in Auckland Mixed Urban zone, big enough driveway, etc.
I haven't subdivided or built before and I'm still confused with all the options.

If I wanted to sell the vacant half of the section I understand I need to get a "title". Is that the same as "subdivision"?

Can I get the title without providing all the services (power, water, sewage connections)?

If instead I wanted to build on that land - do I have to subdivide first? And if I don't subdivide can I still build a bigger house than minor 60m2 dewlling?

Essentially I want to either free up money sitting in the unused land or generate some cashflow from it. What do you suggest?

[Davo36]

I'd suggest you speak to a surveyor in your area. They will be able to come and have a look and answer all of those questions.

Some of them can be answered here, but some of it is site specific...

[Bobsyouruncle]

With your zoning you have many, many options. Go and talk to council or a surveyor.

[John the builder]

I've got a rental with 900m2 section where the house is on one side and the other side is a vacant backyard. I want to do "something" with the spare land. It's in Auckland Mixed Urban zone, big enough driveway, etc.
I haven't subdivided or built before and I'm still confused with all the options.

If I wanted to sell the vacant half of the section I understand I need to get a "title". Is that the same as "subdivision"?

Can I get the title without providing all the services (power, water, sewage connections)?

If instead I wanted to build on that land - do I have to subdivide first? And if I don't subdivide can I still build a bigger house than minor 60m2 dewlling?

Essentially I want to either free up money sitting in the unused land or generate some cash flow from it. What do you suggest?

each dwelling is entitled to a minor dwelling as well? but rule might be different for the new one?

you can build first which means no separate title to sell and remains same ownership but lower costs before getting house subdivided but be careful you will be able to complete subdivsion later do talk to a land surveyor first. I agree with advice book a meeting with duty planner at council.

[Don't believe the Hype]

If you are building with the intention of holding the property for investment purposes and you're not tainted then any future gain is in theory CGT free. If you choose to subdividing later the increase in value driven by the subdivision is likely to be taxable as it is hard to argue that the INTENT of the subdivision is anything other than to increase capital gain.

Would be worth getting advice from your accountant

[Nick G]

Correct, a subdivision is a taxation event. Get advice from your accountant. If you're building to hold then you wouldn't subdivide unless you could release a lot more equity than the cost or you wanted to sell part off.

[Wayne]

Correct, a subdivision is a taxation event. Get advice from your accountant. If you're building to hold then you wouldn't subdivide unless you could release a lot more equity than the cost ir you wanted to sell part off.

Subdivision is a taxation event? Sometimes but not always I believe (but I'm not a taxation expert).

If you had a section that could be split into 3 would you be allowed to build 2 more (making 3) houses on the section without subdividing? Is that allowed?
Real question - not rhetorical.

By this I mean it is 1600sqm so would be able to produce 3x 400sqm+ sections (Hamilton). Would you be allowed to build on the 3 theoretical section (ie keep appropriate distance to potential boundary etc) without subdividing?

[Nick G]

Apologies, I didn't think of the scenario where you'd have to subdivide in order to build.

The phrasing my accountant used to describe it was as a taxation event. Said taxation event might not result in any actual tax however but it does get reported to the IRD and with the brightline test etc it is worth getting advice first.

Your question is different and depends on the local council rules. It's probably that you would have to subdivide in that scenario and that subdivision is a tax event.

[Nick G]

Edit: Double post.

[Wayne]

and with the brightline test etc it is worth getting advice first.

Advice is a good idea.
If you subdivide later the brightline rule may kick in again as the section is then 'new'.
Remember I said MAY - I'm no expert here but something to think and ask about.

[Anthonyacat]

Advice is a good idea.
If you subdivide later the brightline rule may kick in again as the section is then 'new'.
Remember I said MAY - I'm no expert here but something to think and ask about.

Nope! One of a few sensible parts of the Bright Line rules. Purchase date is the original purchase date of undivided land.

But always pays to speak to a tax expert when doing anything remotely complicated with property.

[Wayne]

Thanks Anthony

[Mariam]

House

I've got a rental with 912m2 section where the house is on one side and the other side is a vacant backyard. I want to do "something" with the spare land. It's in Auckland Mixed Urban zone, big enough driveway, etc.
I haven't subdivided or built before and I'm still confused with all the options.

If I wanted to sell the vacant half of the section I understand I need to get a "title". Is that the same as "subdivision"?

Can I get the title without providing all the services (power, water, sewage connections)?

If instead I wanted to build on that land - do I have to subdivide first? And if I don't subdivide can I still build a bigger house than minor 100m2 dewlling? It costing around $200,000 for subdivided thats to much money

Essentially I want to either free up money sitting in the unused land or generate some cash flow from it. What do you suggest?
Or if i can remove my house to the front dont kniw the cost thanks

[Wayne]

I've got a rental with 912m2 section where the house is on one side and the other side is a vacant backyard. I want to do "something" with the spare land. It's in Auckland Mixed Urban zone, big enough driveway, etc.
I haven't subdivided or built before and I'm still confused with all the options.

If I wanted to sell the vacant half of the section I understand I need to get a "title". Is that the same as "subdivision"?

Can I get the title without providing all the services (power, water, sewage connections)?

If instead I wanted to build on that land - do I have to subdivide first? And if I don't subdivide can I still build a bigger house than minor 100m2 dewlling? It costing around $200,000 for subdivided thats to much money

Essentially I want to either free up money sitting in the unused land or generate some cash flow from it. What do you suggest?
Or if i can remove my house to the front dont kniw the cost thanks

To 'get title' you have to subdivide the land into two bits.
To subdivide you will have to supply services.

Personally I would subdivide and build myself. As to whether removing the front house also is a good idea you'll have to access that yourself.
It may be that you can clear the section and build multiple dwellings on the total section maximising use and cashflow (without subdividing - unit title maybe).

[John the builder]

Build first and subdivide later.

You need to cover all the bases so talk to a land surveyor and get the correct location for the building that will comply with requirements later.

subdividing costs 100k but if you build first and rent then you have income while the subdivision can proceed in time or just sell both buildings on the same title.