Subdivision

Subdivision is the process of dividing a single parcel of land into two or more separate titled lots, generally requiring development approval and, once approved, registration of a plan of subdivision before individual lots can be sold or built on separately. Lenders assess a subdivision project against the number and value of resulting lots, the cost of civil works such as roads, drainage and utility connections, and the sequencing of registration relative to any pre-sales, since buyers of individual lots generally cannot settle until the plan of subdivision is registered. A subdivision project shares many feasibility characteristics with a larger construction project — total development cost against gross realisation value — but with civil works and title registration, rather than a building itself, as the critical path most likely to affect timing. Land bank and construction lenders both finance subdivision projects, with the choice generally depending on how far the project has progressed toward registration and sale.

Related

Land bank loans · DA · Englobo land