Subdivision costs are naturally the biggest unknown for people starting their development journey. Heck it can be an unknown for seasoned campaigners as well. The old cliché of “no two subdivision are the same” is very accurate and true, we just want to dive a little deeper into the topic so we can give our clients a broader understanding of subdivision cost breakdown rather than quickly brushing past the question.
Looking back across our last half a dozen subdivisions to give you a broad price guide to start with, for a standard 2 lot subdivision not requiring a right of way the average cost was around $80,000.
Key Components of Subdivision Costs
Subdivision costs are largely centered around your service installation or the construction phase. For a good explanation of what this refers to, have a read of our previous article – Navigating Through Conditions Of Your Subdivision Resource Consent. These services make up over 50% of the overall subdivision costs, and this is the stage that prices can vary significantly from one subdivision to another.
Additional Subdivision Costs to Consider
Outside of construction costs, the remaining subdivision costs can be summarised by:
- Surveyor fees
- Resource consent submission (AEE report)
- Council planning fees
- Technical reports required to appease council
- Project management fees should you be requiring our help through the journey
Additional to this, development contributions have recently been introduced by Whanganui District Council which has increased the costs of any development you will undertake. For a quick look at how much you are likely to pay for your subdivision view the WDC development contributions estimator here.
Finally, don’t overlook legal fees both when purchasing a new property to develop, securing lending to develop the property and when generating your actual titles with LINZ. Your lawyer needs to be involved at each of these stages, which means you need to factor in these costs to your overall budget. If you are unsure what these are likely to be, get a quick estimate from your lawyer so you can use these figures in your subdivision development budgeting.
If you are considering a subdivision project, but you would like more certainty on the costs involved, talk to us about a Subdivision Feasibility Report for your property. This will take an in-depth look into all characteristics of your section and research the costs you are likely to encounter.
