Why Knowing Your Zoning Classification is Important!
We all think our properties are worth more than they are; might be because you have a bit of house pride or maybe it’s because you’re sick of working and hoping that your house has doubled in price and you can retire.
Whatever it is, there might be some truth to your belief!
Research projects Australia’s population to almost double in size over the next 25 years, which is causing governments to change the zoning of different areas to accommodate for the growing population.
But what is zoning?
Zoning is the process of dividing land in a municipality into different sections. These different sections are split up to guide urban growth and development.
Each zone (or section) determines what is permitted and prohibited for development.
Zoning no doubt is an important consideration when it comes to valuing a property.
Think about it – if you could build sky rise apartments on your block of land, then there can’t be a doubt that your land would be worth more than if you were only permitted to have a single dwelling.
Let’s look at some of the different classifications of zones as set by the NSW Department of Planning and Environment:
- R1 – General Residential
- R2 – Low Density Residential
- R3 – Medium Density Residential
- R4 – High Density Residential
- R5 – Large Lot (Rural) Residential
- B4 – Mixed Use – promotes a “live-work” environment by providing higher density residential development integrated with a range of retail, business, light industrial and community uses.
Make sure you know what zone your land is before you decide to sell or buy.
It’s not unusual for agents to make mistakes when advertising a property. If your Agent doesn’t know the zoning of your property they could be ineffectively marketing your property.
Know your zone and you can often profit from this.
On the other end, if you’re a developer or considering developing, make sure you know the zoning of the property prior to purchasing. Purchasing a property under a misguided assumption of what can be built on it can be a very costly mistake!