Rural Subdivision Potential
The Whangarei District Council have recently completed a review of the rural subdivision and development rules in the Whangarei District Plan. The new rules and supporting provisions are a significant departure to the rules that have been in existence since 1998.They are aimed at limiting rural-residential ‘lifestyle’ subdivision in rural areas in favour of rural production activities (i.e. farming and horticulture), with future growth opportunities for the District being directed to the existing city and its rural and coastal residential areas.
There are now only limited opportunities to create small lots in rural areas, making it difficult for farmers to raise capital and reduce debt through the subdivision of small areas of land that are not productive or needed for farming purposes. The exceptions are where there are significant bush and wetland areas on titles containing 20ha or more that can be protected in lieu of the creation of new lots, surplus farm dwellings on titles containing 80ha or more, and adjusting the boundaries of existing titles.
While often rated as one entity, many of Whangarei’s farms are made up of multiple titles. The new subdivision rules provide an opportunity for these titles to be relocated within the overall farmland holding and reduced in size to as small as 2,000m² where practical. One of the philosophies underpinning the new boundary relocation rules is that it provides an opportunity to create larger ‘balance’ land holdings – having the effects of stitching farms back together.
Boundary relocations and adjustments are often more cost effective than creating additional lots by way of subdivision because they don’t attract development contributions (often amounting to as much as $14,000.00 per lot). There are also ways to limit the overall development costs thorough careful design and a detailed understanding of the process.
The ability to raise capital, reduce debt, and to assist in an overall retirement strategy through the rationalisation of multi-title rural landholdings is not often understood. Simple demand and supply economics would suggest that the restriction on the future supply of rural-residential ‘lifestyle’ lots in rural areas will increase the demand for these lots.