Land Subdivision Loans

Organising the right land subdivision development loan with traditional banks or other major lenders is generally a difficult and long drawn out process, this is due to banks being limited to what funding they can offer for vacant land. With restrictions to (LVR) ‘Loan to Value Ratio’ they are able to lend to, leaving the developer in most cases a funding shortfall.

There are other considerations to be aware of with land subdivisions, apart from raising capital for the development. These can include; council approvals for civils, town planning submissions, Site & Civil engineering drawings, rezoning, community acceptance. This process has been known take 3 to 24 months to complete depending on the complexities and the local councils process.

The costs associated with land subdivision are; Plans, permits, consultant’s fees and DA application these fees can reach $35,000 or higher for a simple residential block subdivision. A more complex multi-lot development can reach into the hundreds of thousands of dollars. On top of this are costs for onsite works like drainage, electrical connects, perimeter fencing, water supply and so on, which will need to be covered whether you’re planning to do the subdivision or selling the site once the DA process has been completed.