Are you considering subdividing your land? This article provides an overview of the subdivision process for freehold land comprised in one record of title.
A subdivision is the process of dividing land usually into smaller parts. The subdivision process can be completed in many different ways. This article sets out the usual process and is not intended to cover every alternative.
Your first step is to discuss the proposed subdivision with a surveyor to see if the land is able to be subdivided, what physical work is required, the cost of completing the subdivision and any other issues.
You and the surveyor should then discuss the proposed subdivision with a lawyer to identify any restrictions and/or issues in relation to the title to the land to be subdivided, whether any easements or land covenants will be required, discuss any proposed sale of the subdivided land, whether finance is required, and the ownership structure of the land.
It is also very important that you discuss the subdivision with an accountant to obtain tax advice.
If you decide to proceed with the subdivision, then you will need to obtain a resource consent from the local council. The surveyor will prepare a scheme plan showing the new lots to be created and will lodge this plan with the council, along with the resource consent application.
The council will grant (or decline) subdivision consent subject to certain conditions, generally within 20 working days of lodgement of the application.
The council will normally impose conditions on the consent to ensure your development is sound from both engineering and environmental aspects, and to protect other land owners or future residents. For example, conditions may include a requirement to pay development contributions or for land to be vested for reserves or roads. It is important that you review the conditions of the subdivision consent in order to assess whether the conditions, cost and time frame for complying with the conditions are acceptable to you.
Conditions of consent
If the conditions of the consent are acceptable, then you will need to complete the work to satisfy the conditions of that consent. This may include physical works such as constructing roads and installing services such as sewage, water, and electricity.
In due course, your surveyor will need to prepare a survey plan which will finalise the areas and dimensions of the proposed lots.
Once the survey plan has been completed by the surveyor, your lawyer can then prepare the documentation required for the issue of the new titles. This documentation may include drafting of easements, covenants, consent notices, bonds, and obtaining the consent of any mortgagee.
Once the subdivision consent is granted, you have a maximum of five years in which to have the survey plan approved by the local council under section 223 of the Resource Management Act 1991. The local council will issue a section 223 certificate when they have approved the plan.
You will then have a maximum of three years from the date of the section 223 certification to get the survey plan deposited with Land Information New Zealand.
Before the survey plan can be deposited by Land Information New Zealand, the council must issue a certificate under section 224 of the Resource Management Act 1991 which states that all of the conditions of the subdivision consent have been complied with to the satisfaction of the council. This is called a section 224 certificate.
Issue of titles
Once the section 223 and 224 certificates have issued, the survey plan has been finalised and all the legal documentation has been completed, the surveyor can lodge the survey plan and the lawyer can lodge the legal documentation at Land Information New Zealand for the issue of the new titles.
Once Land Information New Zealand has approved the survey plan and the legal documentation, then the survey plan will deposit and titles will issue for the new lots.
The important message is that before proceeding with a subdivision you should discuss the proposed subdivision with a surveyor, lawyer and accountant so that any issues can be identified at the start.
We at Harkness Henry have significant experience with subdivisions and are able to provide advice should you have any queries.
Published: 07 February 2019