Reality Check: Creating a lifestyle block

Many of us have gone for a drive in the country, perhaps reached the crest of a hill to see a beautiful view fanning out beyond a grassy knoll and thought, "I'd love to own that piece of land". 

But the reality of falling in love with a block of land which is part of a large farm, heading down the driveway and asking the farmer if you can buy it, is just the start of a long, involved and expensive process. 

"It can be done," says Bayleys Rotorua rural agent John Williams, "but you have to be prepared to pay a premium price, and be patient. The farmer/land owner has to go through an involved series of steps to complete the process. And it sure isn't cheap." 

Taking a lifestyle block off part of a farm requires a subdivision, water easements, complying with council regulations and boundary fencing. Then there's the installation of electricity, a septic tank, meeting road frontage regulations ... the list goes on. 

Williams says one of his clients decided to cut two lifestyle blocks off his farm a year ago. One block is 0.8ha of bare land and the other 2.4ha with a house. 

He has spent:$17,000 - earthworks and putting in a driveway 

$10,000 - surveyor 

$1200 - lawyer fees for work to date on title and water easement 

$3000 - fencing, including road entry and gate 

$2000 - Rotorua District Council, for each new title for a parks and reserves fee 

$350 - Rotorua District Council fees 

$112 - water test (compulsory when water is sourced from the ground by bore or spring.) 

All expenses must be paid by the landowner before they can sell the subdivided land. 

He still has to get electricity to the land from the road frontage. Electricity costs start with the surveyor and form part of the consent process to council and once that is approved the necessary paperwork is forwarded to the network provider outlining what is needed to get the power to the boundary of the new property. 

No two properties are alike. Land contour, trees and access all play a part in costings. If the property is within 400m of an existing transformer and the house is sited close to the road boundary, then it might only be cabling that is required. 

If the new subdivision is at the end of an isolated road with few other houses the dollars soon mount up at $25,000 per km for new power lines, plus high voltage extension and transformers at $4000 to $5000, and that is just getting the correct voltage to the lifestyle block boundary. If the house site is at the far end of the block it might require another transformer to ensure the power arrives at the house when you flick the switch. 

A septic tank for sewage is another cost, and if you are thinking of living anywhere near natural water (ie lakes or rivers), the regulations are about to change forcing the price of a new septic tank up from around $6000 to $20,000. 

The costs to complete the subdivision soon add up. 

"It's not only the money," said John, "It's the hassle. This subdivision has taken 12 months and isn't completed yet. There hasn't really been anything to hold it up. It just takes time." 

Farms can only have a certain number of titles subdivided off. So that can be another sticking point with large farms. Many farmers want the subdivision option kept for the family. 

"Chances are that farms are often worth millions. Why would a farmer want to go to all that cost and trouble for a $200,000 or even $300,000 lifestyle block which in the end might only end up making them $30,000 profit? 

"It would be better to ring us at Bayleys," says John with a grin. "Talk to us about your dreams of owning a particular piece of land, tell us what you want to do or hope to do on your block, make sure we know your buying budget and let us take the hassle away." 

John says he tries to match people to land. "It needs careful thought when you are responsible for putting lifestyle block owners into the rural setting. It is different in the country. "I want new lifestyle block owners to become old lifestyle block owners, happy with what they have."