How Subdividing Land Can Benefit Landowners (Part. 1)

Nov. 4, 2020, 1:10 p.m.


For the sake of landowners in PNG who are defined by a nagging impulse to sell their plots, blocks and even acreage cheaply for quick money and short-term acid trips, here's an idea on keeping your land and let it bring you continuous rewards instead.

In this first of two articles on the subject, we'll be looking at subdividing land in order to use some of your real estate to earn good returns on investment, while you keep the remaining portions for your own personal use.

In doing so, a real estate developer and lawyer may offer specific items to advocate evaluations when they're in the process of considering if a proposed land subdivision is the next best thing.


1. Why subdivide my land?



Good question, and one that will only be answered by your level of maturity, in which your circumstances will be measured to that effect.

Say you considered this advice, and you decided it should be the case with your land, moving forward. Here's what to remember as this idea drips into your perspective:

Successfully subdividing your land into residential lots is usually inclusive of many benefits, among which you're given both flexibility and unlimited profit-making potential.

If you're in the process of buying land, or you're an owner yourself, or even own a home lot that has "extra land space", you may want to consider the return on investments in subdividing your land to maximize your real estate resources - and this is the bottom line.


(a). Extra lots, extra money?


With respect to your current situation as a landowner, and the local market conditions, most often than not, there's always the budding possibility of increasing the value of a parcel of land through subdivisions (lots), and selling them to one or more buyers.

In spirit, through this creative approach, these lots become more valuable than others, as a whole.


(b). Save some for personal use

 The other inclusive benefit of subdividing is the owner can still keep the remaining portions to himself or herself, if he/she wishes, respectively.

Understandably, the land system in PNG is quite complicated, since customary land ownership tends to involve not one but multiple members with equal say.



However, there are cases where a single household has the ultimate say, led by the head of the family. In such cases, subdividing may be easily agreed upon, if the guidelines and underlying idea are clearly explained.

Nonetheless, landowners can still maintain several lots for personal use, while the others are up for sale or rent., especially if they have a farm of sorts, or a large vegetable garden, etc.


(c). Enhanced marketability

Upon close observation, you will find that as a landowner on a subdividing venture, buyers will be easier to find. 


How? You ask. 

The size, actually, because subdivided lots are smaller in size and more affordable than one huge piece, they tend to be appealing. Once on the market, they rarely disappoint when it comes to interested buyers or renters.



For the most part, it's wise to make an effort in understanding the local market conditions. When you complete the lot subdivision on time, not only does the prospect of salability continue to swell, but also the value, including that of the whole property’s outlook.


2. Evaluating feasibility

The concept of subdivision of land is realized as common knowledge and practice between real estate professionals, especially the home builders, land developers, and veteran real estate agents. Some have put it into perspective, while others have it collecting dust somewhere at the back of their minds.

In essence, subdividing land happens to be a remarkably prime element of every real estate development, yet it only makes up one part of the all-encompassing development affair.



However, as it is with a coin having two sides, this concept has its ups and downs, and often depends on how resourceful your due diligence is. 

Landowner or homeowner with extra lots, the risk involved in delaying a subdivision of your land, especially when you've made it known - or have stopped midway through the process - can often cost you money and valuable time.

But rest assured that there are quite a few items that may help you decide if this concept is feasible, and if you should pursue it further, to do yourself some financial justice.


(a). Negligibility may just be the goal


So, what did you make of it so far? Do you think your land qualifies for this concept?

In that case it's imperative that the size and scope of your plan needs significant consideration, because it can have multiple degrees of difficulty, when you're up for subdividing your land. 

Frankly, your plan can align with the size of the project - the bigger the project involved in the acreage and the number of lots to be dissected, the greater the complexity.



If you'll be working on just a single lot to split up into two or three residential lots, you'll be able to handle this by working with some property professionals that will help you with the process.

That means your research must be thorough while advocating for your due diligence and planning, where later on you can easily justify the probability of forging ahead with the project, based on its feasibility and financial forecast


(b). Larger means complexity

Once you factor-in an acre into size and two or three lots, maybe, the intricacies of the subdividing process will upsurge fiercely.



The level of difficulty - and the expertise that's required - can be exacerbated if you have a site where the lots given are mindfully set up away from existing public roads and planned infrastructure.


In addition, the design and layout of your site’s subdivisions must undergo municipal oversights, which should cover things like construction of roads, utilities and inclusive infrastructure.

Furthermore, from a municipal oversight comes the urge to evolve this activity from a simple subdivision of a parcel of land into a full-blown community or 'land estate' and land development.

In short, the bigger projects are best left for the pros.


We hope this article was helpful in giving you (landowners) some tips on how to go about making your land work for you, instead of giving it away cheaply for short-term gains. Check back soon for our second article on How Subdividing Land Can Benefit Landowners In PNG.




This article is meant for informational purposes only. Hausples digs into the details of a specific topic and teaches its readers all about how the real estate industry operates. Therefore, not all articles are intended to be construed as financial, or investment advice. Hausples encourages you to reach out for professional help regarding your own real estate situation.