From Building Completion to Separate Titles: Know the process 

As you work on your projects, you might find yourself caught off guard by the more extensive processes and the fact that most builders consider their work complete once the houses are built. As a junior developer, having paid all the money and reaching the peak loan amount, waiting an extra six months can significantly impact your profit and return on investment. 

So, with that in mind, here's a quick walkthrough of the steps you need to go through in Victoria. Make sure to plan accordingly.

Obtain all permits:

Initially, you need to obtain all necessary permits before building, including relevant planning permits, building permits, and approvals from any affected parties, such as easements or those with an interest in the certificate of title. 

Next, complete the construction according to the approved building plans and in compliance with all relevant building codes and regulations. 

Once construction is complete, obtain an Occupancy Permit or Certificate of Final Inspection from the appointed building surveyor, who will inspect the property for compliance with the Building Permit and the Building Code of Australia.

Builder Completes:

Most builders will consider their work complete at this point, and all subsequent processes become the owner's responsibility.  

If you need help from the builder or a Project Manager for the remaining steps, ensure you have a clear written agreement in place from the beginning.  Remember to set out a clear timeframe, as time is the important reason why you employ consultants to help you. 

Once you have an occupancy certificate proving your property is safe, you can usually rent it out separately to different tenants if you choose to.  Consult your insurance company, rental agent, and legal adviser before doing so.

Selling the new properties:

If you're selling the new properties, you'll need the following before the new houses can settle with new owners:

1. Obtain a Statement of Compliance: Have a Council officer review all works and confirm you have built according to the approved Planning Permit/Development approval. The Council can request rectification to comply with the endorsed plan at this stage. This process can take 2-6 weeks, depending on the Council and how quickly you address any identified issues.

2. Prepare a subdivision plan: Engage a licensed land surveyor to prepare a subdivision plan, which shows the proposed boundaries for each new lot, along with any easements, common property, and access arrangements. This process typically takes 1-2 weeks.

3. Submit the subdivision plan with the Council for subdivision approval: Lodge the subdivision plan with your local council or an authorised delegate for certification. The council will assess the plan for compliance with planning schemes and regulations. If you have constructed according to the initial planning permit/development approval, you should receive subdivision approval within 2-4 weeks, depending on the council.

4. Bank Process: If your site is mortgaged, you will need approval from the bank before lodging the plan of subdivision with Land Use Victoria. Most banks will request an Occupancy Certificate and Statement of Compliance before organising a price valuation.  It will take the bank 4 - 8 weeks, depending on how you like to organise the collateral for the mortgage after subdivision and the bank process.  

5. Lodge the plan of subdivision with Land Use Victoria: Submit the certified plan of subdivision, Statement of Compliance, and any required supporting documents to Land Use Victoria. They will register the subdivision and create new titles for each lot. This process can take 4-6 weeks, depending on the workload.

Pay any outstanding fees and charges, such as council rates, land tax, and owners' corporation fees, before the new titles are issued.

Obtain new titles: Once the subdivision is registered and all fees are paid, Land Use Victoria will issue new titles for each lot in the development.

Keep in mind that this is a general outline of the process, and specific requirements may vary depending on your local council and the nature of your development project. It's always a good idea to consult with professionals such as town planners, land surveyors, and solicitors to ensure that you meet all necessary requirements throughout the process.

6. Finally, to settle the sales of the property, you often need to provide four weeks for the purchaser to settle. You may notify the purchaser of the settlement when the Land Title officer indicates that your new title will be ready in about three weeks' time.

Sometimes, your lawyer or conveyancer may not feel comfortable notifying the purchaser until you have received the new title. This is because if there are any delays with the Land Title office, you and your lawyer will need to negotiate another agreement with the new purchaser. Discuss the best way forward with your lawyer, considering what is acceptable for both you and them.

The finalising stage of your project, you have borrowed the maximum amount.  Your cost, for example if you borrowed $2 million (land plus building cost) at this stage with a 6% interest rate, each week will cost you roughly $2,300. Paying a few hundred dollars extra to the lawyer to save a week can yield a good return on investment.  

It's essential to understand this process well and discuss it with your builder, lawyer, financial institution, and other team members as early as possible. Aim to minimise the time spent on each step.