Density is a word that's used a lot when talking about Property Development. Governments of all levels use it when they're talking about housing, saying we need to create more density in key areas.
In fact, the word is used so much in this generic way that it's easy to forget that if you're trying to work out how many dwellings you can fit on a potential development site, the local council will have a much more precise method of calculating density.
Sounds simple, right? Ah, but that would be too easy. In fact, there are multiple methods for calculating density, and not all councils use the same one. Because it's more fun that way.
Let's take a look at the main ways you can determine density, and the lingo used in each context.
Area Density
First up, the generic use of the word "density" is actually correct, although there are two different ways it can be applied.
If you take a square kilometre, then count how many dwellings are in that area, then you have dwelling density for that area. In that same square kilometre if you instead count how many people live there, then you have your population density.
This is an important distinction to make. A big house with one elderly person living in it has a very different impact on infrastructure to a rooming house with 9 people living in it.
Having said that, as a Property Developer with a site to develop, we're mostly interested in dwelling density, so let's stick with that.
Site Density
Getting a little more specific now, how do you get a rough idea of how many dwellings or lots you can potentially chop a bigger site up into? This is better known as minimum lot size.
There's a few different layers here, depending on where you're located. You start at state government level, which is where the rules for different zones are determined.
A higher density zone will allow for smaller lot sizes, whereas a low density zone will have bigger minimum lot sizes.
At a local level, you then need to add in any council overlays, local area plans or precincts. These highlight specific properties or areas within each suburb and the minimum lot size might differ from the state level zoning requirements.
For example, a council might identify an area within a suburb with high levels of indigenous vegetation, and so place a Significant Landscape Overlay on that area. So the zone might allow for, say, minimum lots of 300 square metres, but the overlay may raise that to 1000 square metres in order to protect the vegetation.
This is why, in Property Development Formula, students learn how to become both Council and Area Experts - knowing where overlays are and what effect they have can save you wasting a lot of time chasing properties that aren't developable in a way that's profitable.
Site Specific Density
At this level, we need to look at the specific site's dimensions. First up, you need to work out the site footprint. This is the space remaining after you've allowed for all the required boundary setbacks. The site footprint represents the area where you can place buildings on the block.
Next up is the building envelope. This is basically the 3D version of the site footprint. So you start with the footprint and go up. You need to take into consideration council rules around bulk and height. Many councils will require upper levels to be smaller than the ones below.
A building envelope helps to:
Very basic versions of the building envelope are sometimes referred to as a massing diagram.
Site coverage is how much of the site you're allowed to cover with either the building's footprint or by roofed areas. Most councils will define this as a percentage of the total lot size.
Again, you need to be a council expert on this, as councils can define this as anything from just the habitable space, right through to including all roofed areas such as carports and pergolas.
Many councils will also use gross floor area (sometimes called plot ratio) to determine density. It sounds very similar to site coverage, because it's generally a percentage of the total lot size.
The difference, though, is that gross floor area is a 3D calculation. It's based on the total building envelope, not just how much space is covered at ground level. So if you want to get funky and do some maths, you'd need to work out Site Area x Site Coverage x Number of Storeys.
And as if that isn't confusing enough, there are also 3 main ways councils measure floor area:
Now, having done all the maths, you should know how much of the site your dwellings can occupy in total, which should be enough for the early stage of your due diligence. It's then up to your architect/designer to work out how to divide up the site based on those numbers.
At least working out density is an excuse to use all the maths you learnt at school!
In fact, the word is used so much in this generic way that it's easy to forget that if you're trying to work out how many dwellings you can fit on a potential development site, the local council will have a much more precise method of calculating density.
Sounds simple, right? Ah, but that would be too easy. In fact, there are multiple methods for calculating density, and not all councils use the same one. Because it's more fun that way.
Let's take a look at the main ways you can determine density, and the lingo used in each context.
Area Density
First up, the generic use of the word "density" is actually correct, although there are two different ways it can be applied.
If you take a square kilometre, then count how many dwellings are in that area, then you have dwelling density for that area. In that same square kilometre if you instead count how many people live there, then you have your population density.
This is an important distinction to make. A big house with one elderly person living in it has a very different impact on infrastructure to a rooming house with 9 people living in it.
Having said that, as a Property Developer with a site to develop, we're mostly interested in dwelling density, so let's stick with that.
Site Density
Getting a little more specific now, how do you get a rough idea of how many dwellings or lots you can potentially chop a bigger site up into? This is better known as minimum lot size.
There's a few different layers here, depending on where you're located. You start at state government level, which is where the rules for different zones are determined.
A higher density zone will allow for smaller lot sizes, whereas a low density zone will have bigger minimum lot sizes.
At a local level, you then need to add in any council overlays, local area plans or precincts. These highlight specific properties or areas within each suburb and the minimum lot size might differ from the state level zoning requirements.
For example, a council might identify an area within a suburb with high levels of indigenous vegetation, and so place a Significant Landscape Overlay on that area. So the zone might allow for, say, minimum lots of 300 square metres, but the overlay may raise that to 1000 square metres in order to protect the vegetation.
This is why, in Property Development Formula, students learn how to become both Council and Area Experts - knowing where overlays are and what effect they have can save you wasting a lot of time chasing properties that aren't developable in a way that's profitable.
Site Specific DensityAt this level, we need to look at the specific site's dimensions. First up, you need to work out the site footprint. This is the space remaining after you've allowed for all the required boundary setbacks. The site footprint represents the area where you can place buildings on the block.
Next up is the building envelope. This is basically the 3D version of the site footprint. So you start with the footprint and go up. You need to take into consideration council rules around bulk and height. Many councils will require upper levels to be smaller than the ones below.
A building envelope helps to:
- inform decisions about appropriate density for a site and its context
- define open spaces and landscape areas
- determine visual impact of the building
- demonstrate the mass, scale and location of the development on the site
- determine impact on open spaces in terms of overshadowing
Very basic versions of the building envelope are sometimes referred to as a massing diagram.
Site coverage is how much of the site you're allowed to cover with either the building's footprint or by roofed areas. Most councils will define this as a percentage of the total lot size.
Again, you need to be a council expert on this, as councils can define this as anything from just the habitable space, right through to including all roofed areas such as carports and pergolas.Many councils will also use gross floor area (sometimes called plot ratio) to determine density. It sounds very similar to site coverage, because it's generally a percentage of the total lot size.
The difference, though, is that gross floor area is a 3D calculation. It's based on the total building envelope, not just how much space is covered at ground level. So if you want to get funky and do some maths, you'd need to work out Site Area x Site Coverage x Number of Storeys.
And as if that isn't confusing enough, there are also 3 main ways councils measure floor area:- Gross Floor Area (GFA) - The total floor area contained within the building measured to the external face of the external walls
- Gross Internal Area (GIA) - The floor area contained within the building measured to the internal face of the external walls
- Net Internal Area (NIA) or Usable Floor Area (UFA) - This is the GIA minus space taken up by lobbies, machinery rooms on the roof, stairs, escalators, lifts and the list goes on
Now, having done all the maths, you should know how much of the site your dwellings can occupy in total, which should be enough for the early stage of your due diligence. It's then up to your architect/designer to work out how to divide up the site based on those numbers.
At least working out density is an excuse to use all the maths you learnt at school!
