Developing land for either residential or commercial use in NSW can be a complicated and time-consuming process. From the purchase of the land through to all the issues posed by construction and the ultimate sale of the property, it can be a challenging path to a final profit.
One of the trickiest issues for any developer is dealing with local councils and other relevant authorities to not only gain consent for the project, but also remain compliant with the multitude of legislation, by-laws and other rules which govern property development in NSW.
This article provides a general overview of what’s required through that particular part of the process, but recommends any developer avail themselves of the guidance of expert legal professionals before interacting with government authorities during development, be it local, state or Federal.
What are the key things to know for a property developer
Once you’ve navigated finance and purchase issues to secure a property, the steps to get a development project off the ground have just begun.
It’s important to do your due diligence before securing the land you wish to develop. Different councils interpret NSW development laws in different ways in order to ensure a development is appropriate in its area. A good understanding of the local authority’s approach to town planning will help prevent costly delays in approval of your development project.
There are nine different planning approval pathways in NSW, determined by the size and scale of the development. While smaller development projects such as home renovations and even modest commercial or industrial constructions may be dealt with by the ‘exempt’ or ‘complying’ development pathways (where on application, the project already meets specific standards and land requirements) – and are therefore faster to approve and commence – most residential and commercial property development will fall under the ‘local development’ pathway.
A development is considered local development if a local environmental plan (LEP) or State environmental planning policy (SEPP) states that development consent is required before the development can take place; and it is not considered to be either regionally or ‘State significant’ development.
A developer can enter the address of the proposed development at NSW Planning Portal to see what planning constraints and zoning rules affect the property.
If your development needs consent, an application must be lodged with the local council and will need to include:
- A description of the development;
- the estimated cost of the development;
- a plan of the land;
- a sketch of development;
- environmental assessment in the form of an environmental impact statement or statement of environment effects.
The ultimate aim, of course, is a development consent issued by the ‘consent authority’. This will usually be the local council unless the SEPP specifies the NSW Planning Minister as the consent authority.
The stages of gaining development consent are detailed at the NSW Department of Planning, Industry and Environment website here.
Under the Environment Planning and Assessment Act the council will assess the development application (DA) on the basis of:
- All plans and policies that apply, such as SEPPs and LEPs.
- Impacts of the proposal on the natural and built environment and the social and economic impacts in the locality.
- The suitability of the site for the proposed development.
- Any submissions from neighbours or other groups.
- Any comments or agreements/approvals from any NSW Government agency.
- The broader public interest.
Avoiding pitfalls and likely costs
Time is money and delays during the DA process can significantly impact the economic viability of a development, particularly if the obstacles are serious. Commonly delays arise because the developer has failed to prepare properly in terms of complying with some of the factors we’ve discussed above.
The best way to make sure your DA can proceed relatively smoothly through the process is to rely on the expertise of others in the preparation stage. An experienced architect or designer, builder, town planning specialist and legal expert are some of the key people who can help you avoid costly delays.
Detailed site analysis, research on other recent developments in the surrounding area and speaking with consultants who’ve advised on similar developments are all recommended before you get to the DA stage.
At this stage a thorough budget should also be put together. There are many potential costs facing any developer. Some of those in relation to approvals from government authorities include:
- The DA fee, including the cost of referral to State Government agencies.
- The construction certificate fee as well as fees incurred in the building process for official inspections, engineer’s certificates and more.
- Development contributions payable for State and local services.
- Conditions that may be imposed by council such as bonds to cover potential damage to surrounding infrastructure; environmental clean-up or rehabilitation; dilapidation surveys of attached properties, etc.
- Water and other service connections.
It’s advisable to itemise the known outlays in terms of paying for government approvals and services at the outset of the development.
Discuss your development proposal with us
This article serves only as a brief overview of what’s involved in a progressing a residential or commercial development through the processes demanded by local councils and higher government authorities.
For more detailed advice and guidance, contact Felicio Law Firm. We have the background in all matters related to property development to offer clear, targeted advice that will save you time and money when dealing with the regulatory regime. Call us for an initial consultation today on (02) 4365 4249.