Landowners
Can I Develop My Block?
A guide for landowners wondering about development potential, dual occupancy, subdivision, and backyard development.
Read GuideThe Outcome
Most first-time developers overpay on their first site. This guide explains what actually matters, where to find good sites, and how to avoid the common traps.
The first development site is the most dangerous purchase most developers ever make. Not because the process is inherently risky, but because first-timers lack context. Without reference points, it is very easy to see a large block in the right zone and make an emotional decision. The site looks like an opportunity, the agent is good at their job, and there is always another buyer around the corner.
FOMO is the number one driver of overpaying on development sites. The second is underestimating costs. A site that is priced at $800,000 with a projected build cost of $900,000 for three dwellings looks compelling when comparable sales are at $750,000 per dwelling. But add $120,000 in soft costs, $60,000 in council fees, $80,000 in holding costs over 30 months, and GST on the development margin, and the profit disappears quickly. Knowing how to find development sites is step one. Knowing how to assess them is what determines whether you make money.
Not all sites in the right zone are good sites. Here is what experienced developers look for:
Zoning determines what is physically allowed on a block. R3 Medium Density Residential is the zone where most viable boutique development happens. R2 limits you to dual occupancy. R4 opens higher density but requires more capital and planning expertise. Always confirm the zone before spending time on anything else. Check the NSW Planning Portal or contact the relevant council directly.
A regular, rectangular block is far easier to develop than an irregular or battleaxe lot. Irregular shapes waste usable area and complicate compliant setbacks. Battleaxe blocks are workable but the access handle eats into the lot area and creates additional complications. North or north-east orientation is strongly preferred for residential development: it reduces build cost (passive solar design), improves livability, and produces dwellings that are easier to sell.
Size alone does not determine development potential. Frontage matters. A 900m² block with 10m frontage is far less useful than a 700m² block with 20m frontage. Most LEPs set minimum frontage requirements for dual occupancy and multi-dwelling housing. On the Central Coast and Lake Macquarie, 15m is a common minimum for dual occupancy; multi-dwelling typically requires more. Always check against the specific LEP, not a general rule of thumb.
Sewer is the most critical service. Multi-dwelling development is not viable without sewerage access. If the block is on a septic system, the cost of connection to the sewer network needs to be factored into feasibility, and in some areas, connection may not be possible at all. Power, water, and telecommunications are generally accessible, but confirm there are no known issues with the connection point.
Flood, bushfire, and heritage overlays can materially restrict what is possible and increase construction cost. A development site checklist should always include a check of all applicable overlays. Even minor flood affectation can trigger floor level requirements or limit habitable space at ground level. High Bushfire Attack Level (BAL) ratings add significant construction cost and may restrict certain materials or configurations.
Can construction vehicles access the site easily? Is there a clear path for waste removal, concrete pumping, and crane access? Narrow lane frontage, overhead power lines, or awkward access can add tens of thousands of dollars to construction cost before a slab is poured. This is something most buyers never think about until the builder quotes it.
What is the street and suburb doing? A site in a transitioning street where neighbouring properties are already being developed is a very different proposition to a site surrounded by established single-family homes that will not change for decades. Context also affects end values. What buyers will pay for a new townhouse in a street of renovated character homes is different to what they will pay in a tired, under-invested street.
Most buyers start here, and so do most other buyers. That is the problem. Sites listed publicly are competitive. Agents know what they have, they have priced for competition, and any serious prospect has already looked at the site. You can still find good value on the portals, particularly if you are fast, well-prepared, and willing to move on sites that need imagination. Search by zoning, block size, and days on market.
The best sites rarely reach the open market. They are sold before they are listed, through an agent's database, a direct approach to the landowner, or through networks that most individual buyers are not part of. Off-market development sites are where buyers agents for development work hardest. Access to these sites is one of the primary reasons to engage an advisory firm rather than buying unassisted.
Watching the planning portal for DAs is a useful intelligence source. When a property has been through a DA, the surrounding area often has similar potential. Pre-lodgement meeting records, published DA determinations, and rezonings in progress can all flag areas of near-term development activity before the market prices it in.
Some of the best acquisitions happen when a developer or their advisor approaches a landowner directly, before any formal sales process. This requires research, patience, and relationship-building, but it removes competition and often results in a better price for both parties. The landowner avoids agent fees and the complexity of a public campaign; the buyer gets exclusivity.
Before exchanging contracts, run through the following:
Development feasibility does not need to be a complex spreadsheet at the first pass. A directional feasibility has four inputs:
If end value minus all costs produces a return of at least 15 to 20 per cent on total project cost, the development feasibility is worth pursuing. Below 15 per cent, the risk and effort typically outweigh the return unless there is a specific strategic reason to proceed.
FWG's first development, Élan at 82 Station Street, Bonnells Bay, illustrates what a well-chosen site looks like in practice. The block is 946m², zoned R3 Medium Density Residential under the Lake Macquarie LEP. That combination unlocks multi-dwelling housing, and the feasibility supports three Torrens title residences on a single site.
The site was selected after a disciplined assessment process: zoning confirmed first, lot size and shape assessed for efficiency, services confirmed including sewer connectivity, overlays reviewed, and a preliminary feasibility run before commitment. No shortcuts. The result is a development where every input was understood before capital was committed.
This is what a buyers agent for development actually does. Not just finding sites, but filtering them to the ones where the economics are clear, the risk is understood, and the outcome is purposeful.
The best decisions a developer makes are often the ones not to proceed. Walk away when:
Saying no to bad sites is how good developers protect their returns on good ones.
FWG Advisory works with first-time and experienced developers across site acquisition on the Central Coast and Lake Macquarie. Our role is to shorten the learning curve, reduce the cost of mistakes, and give you access to a network that takes years to build independently.
In practice, that means running site searches, assessing potential with a trained eye, completing due diligence, connecting you with trusted planners and builders, and providing frank advice on whether to proceed. We also work with you on the feasibility so that every decision is grounded in the actual numbers rather than optimistic assumptions.
We work with a select number of clients and we do not work with everyone who approaches us. If you are serious about your first development site, start with a conversation.
We bring disciplined site selection and development advisory together. If you are considering your first development site on the Central Coast or Lake Macquarie, we welcome your enquiry.
Begin a ConversationA guide for landowners wondering about development potential, dual occupancy, subdivision, and backyard development.
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