3 Steps to Kickstart your Multi-Unit Subdivision Project with Family

Taking the first steps to realizing the family dream

For many Aussies, the idea of 'The Great Australian Dream' of owning a detached house on their own bit of land was the norm.

These days, social change, housing affordability, and a growing population mean that 'The Great Australian Dream' is shifting.

We celebrate the concept of Collaborative Subdivisions (Colabs for short), which involve sharing land and building with extended family. We believe it's an excellent housing alternative for many and has rapidly grown in popularity in recent years in response to rising costs of living, the lack of affordable housing in established suburbs, and families wanting to connect more meaningfully.

In our time, we've seen some amazingly successful colab projects, with families building their dream homes, supporting each other, living, and growing together. Now, let's be clear, we're not referring to 'Multi-generational living,' where multiple families live under the one roof! Instead, they share land and live in separate homes. This way, each family can live independently, benefit from privacy, reduce their mortgages, focus on family, and improve their work-life balance.

We're convinced that with increased awareness of this housing opportunity, many more Aussie families would jump on board to reap life-changing benefits.

1) Why! What? Who?!

Subdividing and building with family is not for everyone, so it's essential that all wanting to join the colab are on the same page. Be realistic and consider your family, its quirks, and the mix of personalities—is this a good idea? Work out why the family wants to do this project and what everyone hopes to achieve. Who wants to be involved, and what would they like to gain or contribute? Each family will have its own reasons, and here are some examples we've come across:

Adult kids move close to elderly parents to provide mutual support and spend more time together.
Parents want to give their kids a leg-up on the property ladder and are willing to offer or sell land to the colab.
Siblings want to go halves on a dual occupancy colab for mutual support and cost savings.
Extended family wants to buy a big site to subdivide and build, with the intention of spending more time together.
Family members want to subdivide and build multiple townhouses/units, live in some, and sell off a few to reduce their financial commitments and focus on a better lifestyle.

Dream Team! Assemble!

Once the all-important 'Why' has been established, you can work out who will be joining the colab and what each member must contribute or benefit from. Every family dynamic will be different; some members will be able to pitch in more than others, while others might be benefiting from a helping hand. Whatever works for the family! What's important is that there is a shared understanding, and everyone in the colab is on board with the collective goal and willing to do what it takes to bring the vision to life.

Many hands make light work

Each member needs to step up to take on specific roles, typically based on their strengths, to ensure the project runs smoothly and all bases are covered.

For example, Dad might be the best fit for the leader, bringing the group together and offering up land to subdivide. Mum could be the mediator, running group discussions, delegating tasks, and sorting out financials. The daughter could be the team rep for the designer and consultants, handling project admin, and relaying all communication amongst the group.

Typically, these responsibilities belong to a developer; however, with family colab projects, tasks can be split up and delegated to allow the project to be more manageable and save on the developer's margin, which is 15% of the total project cost! It's still advised to check in regularly on each member's progress to see if they need help and to keep them accountable, after all, you'll be assuming the role of a professional.

Let’s talk about it

It's crucial to be crystal clear about everyone's commitment level, expectations, and responsibilities within the project. For example, my family did a colab project where I oversaw all things project-related and sorted out ongoing fees, while Dad dealt with the build funding and land. We relied on and trusted that each would take care of their parts and were careful not to butt in or interfere in each other's processes or decisions. We found that this worked well for us as we've worked together previously on other mini-projects. Each family colab will have its own dynamic, and it's important to get the right balance when working together as a group.

There were occasions where we encouraged other passive members to speak up and share their thoughts and concerns, mainly at major milestones. For example, we asked Mum and my brothers if they had any input on layouts, builder selection, or materials and color preferences. By doing this, everyone felt included and heard (at least we hope they did). If not, at least they were consulted before committing to decisions to mitigate any major disagreements or hard feelings later. It also helped to sense-check our choices, as passive members could offer an outsider's view and different ideas that we might not have thought about.

2) Who’s bringing what to the party?

Work out how much each member can contribute and what they can comfortably offer to the colab. All should carefully evaluate their financial capability.

A few case studies below:

Case Study 1 – One complex colab we worked on involved a retired couple, Mum and Dad, who wanted to be closer to their two adult daughters. They wanted to help with raising their grandkids and had outgrown their double-storey family home, which needed serious renovations and ongoing maintenance. The other two families were also keen to be close to the parents to offer and benefit from support, enjoy living together, and move out of their small, dated townhouses into large custom ones with all the mod cons. Dad secured a site big enough for three townhouses, and the two daughters and their husbands sorted out the construction loans for the build, design fees, permitting, and holding costs. All three homes shared one driveway, basement carpark, and open space; however, each home was separate and detached. It was an excellent design solution as it allowed everyone plenty of space to grow into while also benefiting from communal landscaped gardens and fully appointed BBQ and outdoor living and dining spaces.

Case Study 2 – Another smaller colab involved a situation where Mum and Dad knocked over the family home and allowed their daughter and her husband to rebuild a double-storey home to live in, while they built a smaller unit to the rear of the house to retire in. The idea was to share a central outdoor courtyard that functioned as a communal gathering space for impromptu dinners and catchups. Mum and Dad wanted to give their daughter a huge gift and be close by to help look after and spend time with their grandkids while maintaining their independent living. The daughter also wanted to be there to support her parents eventually when they needed it.

For the greater good

Unlike subdividing for profit, family colab subdivisions might not be focused on turning a profit or even making sure that each member benefits equally; instead, many are aimed at either helping family or enjoying living close to each other! Whatever the reason, it's critical that the family establishes from the beginning who and how much each member is financially responsible for, in black and white, to avoid any misunderstandings later down the track.

Again, there's no right or wrong way to go about it; it's whatever works for the family. We've come across all sorts of agreements, and some families opt to:

Split all costs evenly.

Have one member cover all consultant, designer, and ongoing costs, while the other is responsible for securing the construction loan to fund the build.

Have a son or daughter fund the entire project from start to finish and gift elderly parents a home (this scenario can be reversed as well).

Have Mum and Dad gift an unused backyard to their daughter, who then funds the build.

Have a large extended family buy two adjoining sites and split it up four ways, with each member contributing evenly for design and permits but separately for the builds.

It's always best to get the family's collective agreement down on paper; it allows the group to keep track of what everyone has signed up for, quantify assets, and may be brought up for clarity or just to provide peace of mind.

You will need a professional to draft this up as it is a legal document.

3) Feasibility – separating the dream from reality

Before taking the plunge with your whole family in tow, it's critical to conduct a thorough project feasibility study. I know it sounds boring, but this step could easily be the most crucial and unforgiving one throughout the entire journey.

It involves group planning; such as determining how much it will realistically cost to pick up a development site, selecting the group's preferred suburb (and a few backup ones), setting a realistic construction budget based on accurate costings, deciding on the size and type of home, factoring in consultant fees, permit costs, and even accounting for some contingency for unexpected surprises (typically 15% of total costs). You'll want to be as accurate as possible with these figures to determine how much your colab will need to finance, and also to identify at what specific stage you'll need to pay for major milestones, such as a down payment on the property or consultant fees.

Research, research & more research!

Not all sites can be developed and it’s important to investigate each property you’re considering thoroughly & consult a professional with relevant experience to help identify any pitfalls or red flags. There’s no sugar coating it, picking a development site is very risky business, it will either make or break your project. The key things to look out for:

Covenants, some sites are prohibited from building more than one house on the lot.
Heritage overlay restricts what you can do to the existing home & may even prevent you from demolishing it.
Trees, the Council may prevent you from removing certain ones from your property, especially significant healthy native ones!
Orientation will determine the layout of the homes.
Topography, how flat or sloped the land is, this will dictate the design of the homes & levels of the internal floors.
Neighbourhood Character refers to Council’s specific development guidelines for each site, it’s different for each residential zone. This dictates the height, layout, materials & even design style you’re allowed to build! Some residential zones even restrict the number of homes permitted on each site.
Easements, such as underground sewer pipes, power lines & other authority assets.
Land size, depending on how many units you’re looking to fit on the property, you will need to make sure you have enough space.

In addition to qualifying the site for all the above checklist items, you’ll also need to work out if the colab ’s project wish list requirements can be achieved. For example, a brother & sister are looking to do a dual occupancy side by side style colab, where they each want to their own street frontage & separate vehicle access.

If you speak with a professional, they might tell you straight up with Monash Council, within certain suburbs, you’ll need to look for a site with a minimum width of 20m. This could immediately save you from looking at irrelevant sites or even whole suburbs where a dual occupancy style projects are strongly discouraged.

Get it right from the start

LAYOUT EXPLORER

Can help you move forward and make informed decisions (whether your goals are achievable or not!) knowing you’re equipped with the info you need to start your project.

EXPLORE

Chances are, most families looking to do their own subdivision colabs won't have much or any experience in running their own project. Likely, they'll have zero idea who to ask for help, what to do, and where to start, which is totally fine. It is, however, essential to look extensively for the right professional who can help you with your specific needs. A subdivision colab project is highly complex and needs a tailored approach to delivering the project. Ideally, you'll want to find someone experienced in working with family subdivision developments, not your typical unit/townhouse project that focuses more on the lowest cost per m2 rather than high-quality design, family lifestyle, and multiple varied design briefs. Colabs require a lot more time & finesse to ensure the best results.

If you prefer or can't manage the colab as a family, you have other options. Your architect or building designer can assist with project management for the plans and permit process on your behalf. They can also help with the vital pre-planning stage, helping you work out if your family subdivision colab is feasible from the outset and providing valuable insights into other opportunities or challenges you might not have thought about. Their advice and expertise can save you from making fatal mistakes!

A family subdivision colab can be life changing!

For countless families out there, the thought of embarking on a multi-unit subdivision project with their loved ones is like a dream come true. The idea of creating a shared space where everyone can be close yet have their own separate homes is truly exciting.

However, we understand that the process of bringing this dream to life can seem daunting and overwhelming. It doesn't have to be difficult or a stressful experience.

In fact, with the right approach and guidance, turning your vision into reality can be a smooth and enjoyable journey. Not to mention, you'll be looking to enlist the help of professionals and experts to guide you through the complex process and tackle the tricky parts.

To read a more comprehensive guide, be sure to check out our '8 Step Guide to Small Housing Subdivisions with Family,' or if you're thinking of taking the next step, feel free to reach out and discuss your project!

Additionally, if you'd like help looking into a site for subdivision potential, look into our Site Feasibility Study package.

Otherwise if you’re thinking of taking on a family subdivision colab & want some help, feel free to get in touch to discuss how we can assist!