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I admit I am a bit wet behind the ears when it comes to knowledge about properties and costings, but I have completed a subdivision on a residential block of land in South Coast of NSW.
So far my subdivision (which had existing council approval when purchased) has cost about 60K, I understand the approval can costs up to 30k and depending on the requirements (such as access road, sewer, electricity provisions) you might be up for a lot more than you think, not to mention the 15K council fees that my council require to be paid before going to lands and titles council.
Now that I have block on market I am finding that because it is a battleaxe block, some people are turned off it. Make sure you consider that when you estimate a final value.Theres money to be made but just watch out for the cost that you dont get told about.
Alternatively get the subdivision approval and sell it off as a potential subdivision!
I recently bought a house with older style fibro house on front block with council approval to subdivide rear of block (1300 sqr block) like you I needed to widen access past house to get to rear block, this consisted of knocking down side of existing house and removing a garage / granny flat room thing.
The costs blew out as they tend to but the main ones that I didn't consider were that
1. I needed to lodge another development application to knock down and rebuild side of house and remove garage, this included having plans drawn and council fees for the application, the actually work cost $12000 to have walls removed, roof and walls rebuilt, $3000 for garage to be knocked down and taken away
2. Driveway needed to be 4 metre wide access and actually concrete driveway was 3 metres wide (might be different in VIC) drive alone cost $15000
3. Even with existing approval, costs to council were $9500 for water and $4500 for council, plus some miscellanous ones
It has been difficult and took a few months and that was with existing subdivision approval! Current market not great so I have to hold block until I build or things go up!
But if you do all your research and figures and it adds up – Go for it!
If I did it again I would use the orginal surveyors who drew up original subdivision proposal to oversee the whole project!"
