THE INS & OUTS OF SUBDIVISIONS

Do you intend to subdivide your property? It is common to view subdivision projects as difficult and complicated procedures, but with the assistance of expert advisors on your team, your vision could become a reality sooner and be more straightforward than you think. Whether your project involves two residential lots or a multi-stage development of 100 lots or more, our specialist property team at Wakefields Lawyers have the experience to help with all aspects of your project.

What is a subdivision?

Subdivisions can occur in all shapes and sizes. Essentially, subdividing is the process of dividing a parcel of land into two or more smaller parcels. Land subdivision creates separate records of title, which can be on-sold to create multiple residences or commercial properties out of a single piece of land. Whether you are looking to subdivide lifestyle, commercial or residential blocks, our expert team can seamlessly guide you through the process.

What does the process involve?

Here is a summary of the typical steps involved in subdividing:

1. Thorough investigations need to be undertaken to ensure your property is able to be subdivided. Lawyers, surveyors, and planners all need to contribute to undertaking these investigations.
2. Applications need to be submitted to the council for all the necessary resource consents (including a subdivision consent) for the subdivision development. Usually this is overseen by either your surveyor or planner.
3. When all the consents have been issued, the property needs to be surveyed/marked up and a survey plan prepared by the surveyor.
4. The physical subdivision works then take place (for example constructing entranceways and roading, laying pipes, installing drainage services, etc).
5. When all the subdivision works have been completed to the satisfaction of the council (as determined by inspection), the council issues all the necessary territorial authority certificates (TA Certificates) for the issue of the new separate records of title for the completed subdivision.

NB:  Usually all the required subdivision works must be completed before the council will allow the separate records of title to be issued. Sometimes the council will permit some of those works to be completed at a later day. However, in those circumstances the council would required a financial bond to be granted in their favour and registered on the new records of titles.

6. Next, your completed survey plan is lodged with the council for its approval and issue of all the necessary TA Certificates. This is usually overseen by your surveyor.
7. The approved survey plan is then submitted (with the TA Certificates) to Land Information New Zealand (LINZ) for its approval as to survey.   This is also done by your surveyor.
8. At this point, your lawyer sets up the Landonline eDealings for the subdivision, and prepares or obtains, and attends on the signing of, all the necessary legal documentation for the registration of the subdivision. That documentation includes mortgagee consents, order for new records of title, easements, land covenants, transfers, mortgage discharges, replacement mortgages, etc.
9. Once the survey has been approved by LINZ, in order to streamline the final registration process for the subdivision, it is best practice for your surveyor to co-ordinate its application for the deposit of the plan with your lawyer’s registration of the subdivision eDealings. However, such a parallel lodgement is not always practically possible.

Why is the role of a lawyer so important in this process?

Throughout the subdivision process, your lawyer is also responsible for:

1. Assisting with the resource management process (if required – depending on the complexity of the subdivision).
2. Verifying the head title (ensuring there are no limits as to parcels, caveats, mortgagees, or encumbrances on the title).
3. Checking the survey plan before it is submitted to the council for approval, and providing advice on the subdivision procedure.
4. Creating any required easements for your subdivision (such as rights of way for shared access routes and service easements for water, power, sewage, gas and telecommunications).
5. Preparing any required land covenants for your subdivision (eg. restricting further subdividing, restricting commercial activities, limiting the number of dwellings permitted, to name a few).
6. If you intend to sell one or more of the new records of titles you are creating, your lawyer will create the sale and purchase agreements, and assist with the sale process. The sale of the land can have a contract on it at any point throughout the subdivision process.
7. Work with the council, surveyors, banks, and other essential stakeholders to make sure the subdivision receives all necessary approvals and final certification.
8. Attending to the signing of the required documentation, once every certificate and approval has been obtained (in order to apply for the new records of titles and finish registration).

As subdivisions reach completion, many developers find comfort in already having sale contracts confirmed and entered into for one or more of the subdivided lots. In some cases, vendors/developers may even be able to use purchase deposits or the initial sale of one lot to finance the main subdivision itself, minimising the need for additional financing.

As you can see, expert advice is essential to ensuring that your subdivision project is completed efficiently and accurately.  It is vital to ensure that your land is suitable for your intended purpose, there are no fishhooks or gaps in your contracts or documentation, your best interests are protected, and you are constantly supported along the way.

At Wakefields Lawyers, we have the expertise and experience to ensure that your project is conducted in a timely and thorough manner. If you would like more information about whether your subdivision vision can become a reality, please contact Wakefields Lawyers on 04-970-3600 or email info@wakefieldslaw.com.

– Kailey Northcott (Solicitor)