Real Estate Strategist Council Approval Consultants
What Property Investors Need To Know

Wide-ranging reforms to strata laws were introduced by the NSW Government. Aimed
at addressing issues of urban renewal and consolidation, the new legislation
recognises that, given the projected increase in our population, the current level of
housing stock is inherently insufficient.

Does This Mean Investors Are Set To Make Large Windfall Gains From
Selling Their Strata Blocks For Development?
The answer will depend upon several key factors. Firstly, if the unit block is in a high-
value location, with the potential for higher density redevelopment, it will be a prime
target for “renewal”.

So, for an existing, old and run down strata scheme located in an expensive suburb an
investor may profit by rebuilding that strata scheme into a larger, high rise apartment
block. Even when their land is re-zoned to enable higher-density development,
investors could reap windfall profits without actually building any new housing, simply
by consolidating and selling to a developer.

Secondly, once rezoned, redevelopment may be feasible for investors with an existing
strata building on a site that is under-capitalised. This uplift in land value justifies the
development of higher-density housing in those areas with a high amenity.

Finally, freeing strata owners from unproductive, spiraling maintenance costs in a
building that has had its day will also be financially beneficial. For Sydney’s large
supply of older apartment buildings with their on-going need for major repairs, these
laws make it easier to renew strata buildings, by knocking them down to rebuild.

Do These New Strata Laws Mean Any Building Can Be Re-developed?
Not necessarily. In line with government policies to provide more housing, demolishing
older, low-rise and medium-rise apartments means more efficient use of the
infrastructure and services that are in well-serviced, inner city locations.

This means, to cash in on these new strata laws, investors will need to be aware that
not every building is going to be ripe for redevelopment. A well-maintained building, in
an area that hasn’t been rezoned, is not likely to be profitable for renewal.

Why Choose RES Planning Approvals For Your Property Development
Essentially, for investors to benefit from these new laws, they will need to appreciate
the complexities of how this legislation will work and how long the process could take.

Safeguards in the legislation, including applying to the court to ensure the proposed
development is just and equitable, dealing with councils and individual owner attitude,
has the potential for a long, drawn out process. It’s possible this could take years to
play out, especially with unhappy owners.

This means, investors seeking to cash in on the new strata laws need to factor in the
feasibility of redevelopment against the backdrop of possible housing market
fluctuations that can occur during long, drawn-out planning processes.

Want help to maximise the profits from your investment property? Find out how you
can get fast, worry-free planning approvals for your property.

Call us to find out more about our fast, friendly, cost-effective planning approvals
email us today!
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