The average Southeast Queensland backyard is being split at a rapid rate by “mun and dad” investors.  The Courier Mail has revealed the number of lots being approved for subdivision in Southeast Queensland has doubled in the past 5 years.

Subdivision of lots approved have increased from 9332 in 2012 to 19,052 in 2016 for lots in the Gold Coast, Logan, Brisbane, Moreton Bay and Sunshine Coast areas.  The rise in subdivisions has been driven by “mun and dad” investors seeking to capitalise on land values as kids leave home and couples become empty nesters, to possibly help fund lifestyle and retirement.

The trend has been encouraged by State Government and local councils that are favouring densification of city planning over continual city sprawl, as mention in the Brisbane City Plan 2014.

Major Stats

• 9332 Subdivisions approved in 2012
• 19,052 Subdivisions approved in 2016
• Average block size in 1995 was 675 spm
• Average block size in 2016 was 475 spm and falling.

After pulling down an old house on an inner city block, 4 town houses were built, then sold to another developer during construction – one of the GST traps!

We are finding an increase in enquiries from “mun and dad” investors looking for advice on –

• Town planning issues.
• Capital Gains Issues on splitting the back yard.
• If the block is split and if an investment property is built and sold or rented, what are the tax issues to consider?
• Joint venture options and ownership options, transfer of ownership, and business structure options to maximise profits and minimise tax.
• Some “mun and dad” investors are seeing that for relatively small investments, they can create a separate block which can be sold or further developed to maximise the profit potential of the subdivision.
• Also finding an increase in enquires for “mun and dad” investors looking to buy / renovate old houses to sell for a profit, after gaining experience renovating their own home.
• GST Margin Scheme – how it can help save $$$ in GST

Principal – Garry Wolnarek

We offer all “mun and dad” investors the opportunity to explore the options above for a small initial investment of only $275.

Umbrella Accountants have worked with property clients over 16 years. We have experienced first hand the property cycles and have helped many clients with property investments over that time.

In addition we have completed thousands of rental property tax returns for investors all over Australia over many property cycles; advising on buying, holding, renovating, splitting, developing and selling property.

Our advice is completely independent, and tailored to your specific situations as we are not affiliated with any property group.