• Login:
Welcome, Register Here
follow PropertyTalk on facebook follow PropertyTalk on twitter Newsletter follow PropertyTalk on LinkedIn follow PropertyTalk on facebook
Page 1 of 2 1 2 LastLast
Results 1 to 10 of 20
  1. #1

    Default Do I have to subdivide to build?

    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?

  2. #2
    Join Date
    Sep 2007
    Location
    Auckland
    Posts
    8,321

    Default

    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...
    Squadly dinky do!

  3. #3
    Join Date
    Apr 2016
    Posts
    2,343

    Default

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

  4. #4

    Default

    Quote Originally Posted by Curious View Post
    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.

  5. #5

    Default

    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

  6. #6

    Default

    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.
    Last edited by Nick G; 07-08-2017 at 03:05 PM.

  7. #7
    Join Date
    Jun 2004
    Posts
    10,404

    Default

    Quote Originally Posted by Nick G View Post
    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?
    Last edited by Wayne; 07-08-2017 at 01:19 PM.

  8. #8

    Default

    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.
    Free online Property Investment Course from iFindProperty, a residential investment property agency.

  9. #9

    Default

    Edit: Double post.
    Last edited by Nick G; 07-08-2017 at 06:09 PM.
    Free online Property Investment Course from iFindProperty, a residential investment property agency.

  10. #10
    Join Date
    Jun 2004
    Posts
    10,404

    Default

    Quote Originally Posted by Nick G View Post
    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.


 

Thread Information

Users Browsing this Thread

There are currently 1 users browsing this thread. (0 members and 1 guests)

Similar Threads

  1. Better to Buy, Subdivide and Build or Renovate?
    By babelulu in forum Property Investment (NZ)
    Replies: 8
    Last Post: 17-12-2016, 01:35 PM
  2. Do we have to subdivide?
    By Annach in forum Property Investment (NZ)
    Replies: 3
    Last Post: 08-08-2016, 12:58 AM
  3. Subdivide my land and build OR just buy another Wellington
    By Jamus in forum Property Investment (NZ)
    Replies: 7
    Last Post: 12-03-2016, 11:09 AM
  4. Subdivide and build in Auckland
    By qzha017 in forum Property Investment (NZ)
    Replies: 4
    Last Post: 04-08-2013, 09:20 PM
  5. Anyone who knows about subdivide??
    By evolover in forum Property Investment (NZ)
    Replies: 5
    Last Post: 12-01-2012, 05:02 PM
  6. Tax calculation for new subdivide and build house
    By imd6662 in forum Finance, legal and tax (NZ)
    Replies: 6
    Last Post: 28-11-2011, 10:19 PM
  7. To Subdivide or Not
    By benz in forum Property Investment (NZ)
    Replies: 7
    Last Post: 22-04-2010, 03:50 PM
  8. ROTORUA - Subdivide, Build & Develop
    By grumpyleader in forum Property Investment (NZ)
    Replies: 5
    Last Post: 06-11-2005, 08:13 AM
  9. To Subdivide and Sell; or Subdivide and Build and Rent out?
    By Shoshin in forum Property Investment (NZ)
    Replies: 4
    Last Post: 05-04-2005, 09:59 AM
  10. Property Investment Trumped
    By Marc in forum Property Investment (NZ)
    Replies: 0
    Last Post: 19-12-2003, 08:45 PM

Tags for this Thread

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •