Strata Subdivision in NSW: An Easy Guide for Dual Occupancies and Multi-Dwellings

Welcome to your comprehensive guide to the requirements and processes for strata subdivision in NSW - with a specific focus on low-rise housing such as dual occupancies (attached and detached) and multi-dwellings (townhouses).

1. Foundational Concepts: The NSW Strata Landscape for Low-Rise Development

The decision to pursue a strata subdivision begins with a firm understanding of the legal and planning framework that governs this unique form of property ownership.

Unlike a traditional Torrens title subdivision, which divides a single land parcel into multiple independent land parcels, strata subdivision creates a system of shared and individual ownership that has profound long-term implications.

1.1 The Essence of Strata Title

A strata title is a legal framework for subdividing a building or a group of buildings into separate 'lots' and shared 'common property'. 

The most significant distinction from a Torrens title is that a lot is defined not as a parcel of land but as a three-dimensional, cubic space. 

The physical boundaries of a lot are defined by the inner surfaces of walls, the upper surface of floors, and the lower surface of ceilings. 

This fundamental concept is crucial, as the boundaries established on the strata plan dictate all future responsibilities for maintenance and repair.   

The act of registering a strata plan automatically establishes an Owners Corporation, which is a body corporate comprising all lot owners. 

This entity is legally responsible for the management, repair and maintenance of all common property. This is not a static legal structure, it is a perpetual legal and social community.

The implications of a lot's boundary definition can be profound eg a court ruling has established that fixtures like carpets, floorboards, tiles and paint, if installed at the time the strata plan was registered, are considered part of the common property.

This means that a developer’s choice of materials and the timing of their installation can have a direct causal effect on the future financial liabilities of the Owners Corporation for maintenance or replacement. 

This illustrates that the initial subdivision is not a simple transaction but the formation of an enduring legal entity with a defined set of long-term financial and social obligations. 

1.2 Key Legislative and Planning Instruments

The entire strata subdivision process in NSW is governed by a legislative environment.

The primary acts are the Strata Schemes Development Act 2015 (SSDA), which provides the legal framework for the creation and subdivision of strata schemes, and the Strata Schemes Management Act 2015 (SSMA), which dictates the scheme's ongoing management, governance and dispute resolution.   

A major change to this landscape has been the introduction of the State Environmental Planning Policy (Housing) Amendment (Dual Occupancies and Semi-detached Dwellings) 2024. 

This reform, enacted on 1 July 2024, now permits dual occupancies and semi-detached homes as permissible developments in R2 Low Density Residential zones across 124 council areas, where they were previously restricted or outright prohibited. 

This policy is a strategic instrument designed to streamline development by favouring the Complying Development (CDC) pathway for these housing types.

The policy's expansion of dual occupancy eligibility for the CDC route creates a direct link between state policy and the speed of project delivery.

This shift has led to an incentive for developers to design projects that meet the prescriptive CDC standards, allowing them to bypass the typically longer and more subjective Development Application (DA) process.

The consequence is a potential trend toward more uniform, code-compliant designs across the state.

1.3 Dual Occupancy and Multi-Dwelling Housing Defined

The specific type of low-rise development a project involves will influence the planning requirements and future strata obligations.

• Attached vs. Detached Dual Occupancies: A "dual occupancy (attached)" is defined as two dwellings on a single lot that are connected, typically by a common wall. A "dual occupancy (detached)," by contrast, consists of two separate, detached dwellings on a single lot. This distinction is critical for two-lot strata schemes. The legislation allows for a significant exemption for detached schemes: the Owners Corporation is not required to have a Capital Works Fund or compulsory building insurance if both owners agree to forgo it via a unanimous resolution. 

  
  

• Multi-Dwelling Housing (Townhouses): This typology, which can be certified as complying development under the Low Rise Housing Diversity Code, involves multiple dwellings on a single lot, typically arranged in a row or around a common driveway. The planning and certification processes are similar to those for dual occupancies, but different design and site requirements apply, such as a minimum site area of 1,500 sqm and a minimum lot width of 25 metres for multi-dwelling housing in some Local Environmental Plans (LEPs).   

  
  

2. The Strategic Planning Stage: DA vs. CDC

The initial decision to pursue a Development Application (DA) or a Complying Development Certificate (CDC) is the most important strategic choice a developer will make.

This choice sets the project timeline, influences costs, and determines the level of design flexibility.

2.1 The Complying Development Pathway (CDC)

A CDC is a streamlined approval process for developments that strictly adhere to a set of pre-determined standards and codes.

• Purpose and Speed: The primary benefit of a CDC is its speed. A CDC can be issued by an accredited private certifier in as little as two to four weeks, significantly faster than a typical DA. This reduction in turnaround time can lead to substantial savings on land holding costs and development loan interest.   

  
  

• Strict Criteria: To be eligible for a CDC, the project must meet every single requirement of the Low Rise Housing Diversity Code. These standards are prescriptive and leave no room for deviation. Requirements include a minimum lot width of 12 metres for duplexes and a minimum lot size of 400 square metres, or the minimum lot size stipulated by the local council, whichever is greater. Any non-compliance, even minor, will immediately disqualify the project from the CDC pathway, necessitating a full DA.   

  
  

2.2 The Development Application (DA) Route

A DA is the traditional, discretionary approval process managed by the local council.

• Scenarios Mandating a DA: A DA is required when a development does not meet the strict CDC criteria or if the site has specific constraints, such as being located in a heritage conservation area. It is a more subjective assessment, allowing for a more nuanced evaluation of the project's impact on local character and amenity.   

  
  

• Local Planning Controls: While the state-wide SEPP provides a broad framework, local planning controls in the Local Environmental Plan (LEP) and Development Control Plan (DCP) still apply and may impose additional requirements. These controls can dictate minimum lot sizes for subdivision, setbacks, and design standards that are specific to the local government area (LGA).   

  
  

2.3 Strategic Decision-Making

The choice between a DA and a CDC is an upfront business decision that balances speed and cost with design flexibility.

A CDC offers a clear path to fast approvals, which can significantly reduce financial risk. 

The recent legislative changes, by expanding the eligibility of dual occupancies for CDC, have shifted the planning landscape to favour this route.

Developers are now strategically motivated to design their projects to fit the CDC criteria precisely.

Conversely, a DA, while slower and more costly, provides the flexibility to pursue more bespoke or complex designs that may not fit within the rigid confines of the CDC standards.

3. A Checklist for Dual Occupancy

When considering a strata subdivision for a dual occupancy, especially an attached one, a variety of controls, including minimum lot size, must be adhered to.

These requirements differ based on whether you are pursuing a Complying Development Certificate (CDC) or a traditional Development Application (DA), and they can also be influenced by the specific local council's rules.

Minimum Lot Size and Lot Width

For an attached dual occupancy on a single title, there is no single, state-wide minimum lot size that applies in all circumstances.

Instead, the requirements are dictated by the specific planning pathway and location:

• Complying Development (CDC) Route: If the project is designed to be approved via the CDC pathway, the parent lot must be at least 400 sqm. This is a state-level minimum, but it is also subject to the local council's Local Environmental Plan (LEP). In this case, the greater of the two lot sizes applies. The lot must also have a minimum width of 15 metres at the building line, though this can be reduced to 12 metres if the vehicular access is from a rear lane, parallel road, or secondary road.   

  
  

• Development Application (DA) Route: For a DA, the minimum lot size is determined by the specific local council's LEP and Development Control Plan (DCP). For example, in Lake Macquarie, the minimum lot size for a dual occupancy in a residential zone is generally 500 sqm. Some councils may also have specific rules for attached dual occupancies, such as the minimum lot size of 275sqm for each lot resulting from the subdivision.   

  
  

Other Key Controls

Beyond minimum lot size, there are a number of other essential controls for dual occupancies, particularly under the Low Rise Housing Diversity Code:

• Building Height: The maximum building height for both attached and detached dual occupancies is 8.5 metres and a maximum of two storeys.   

  
  

• Gross Floor Area (GFA): The total GFA for all buildings on a lot of 2,000 square metres or less cannot exceed 25% of the parent lot area plus 300 sqm.   

  
  

• Landscaped Area: At least 50% of the parent lot area, minus 100 square metres, must be landscaped. A minimum of 25% of the front yard must also be landscaped, and at least half of the required landscaped area should be behind the building line.   

  
  

• Private Open Space (POS): Each dwelling must have its own private open space. For ground-level dwellings, this must be at least 16 square metres with a minimum width of 3 metres. For an upper-level unit, a balcony of at least 8 square metres (for one-bedroom units) or 12 square metres (for two or more bedrooms) is required.   

  
  

• Parking: Each dwelling must have at least one off-street parking space.   

  
  

In addition to these, developments must also comply with setback rules and other design criteria, such as those related to solar access and privacy. 

For multi-dwelling housing, a Local Environmental Plan (LEP) or a Development Control Plan (DCP) may also specify controls such as a minimum site area of 1,500 square metres and a minimum lot width of 25 metres.   

4. The Professional Team

The subdivision process is not a single application but a multi-disciplinary project that requires a team of experts.

The developer acts as a project manager, coordinating with various professionals to ensure all reports, plans, and certificates are meticulously prepared.

4.1 The Role of the Surveyor

The registered surveyor is the most critical professional in the strata subdivision process. Their work forms the legal basis for all future property transactions.

• Pre-Approval: The surveyor is typically the first professional engaged. They prepare a Contour and Detail Survey that provides the essential site information for the architect to design the development. They then use the architectural plans to create a draft strata plan to accompany the initial DA or CDC application.   

  
  

• Post-Construction: Once the building is completed, the surveyor prepares the final Strata Plan. This plan accurately defines the cubic space of each lot, including the vertical and horizontal boundaries, car spaces, and storage areas. The surveyor also prepares the Strata Plan Administration Sheet  and a Section 88B Instrument. The latter is a crucial legal document that outlines any easements, rights of way, or covenants (eg restrictions on land use or building heights) that will be applied to the new lots upon registration.   

  
  

• Legal Gatekeeper: Only a surveyor registered with the Board of Surveying and Spatial Information (BOSSI) is legally authorised to prepare these plans. Using an unregistered surveyor can lead to rejected plans, costly revisions, and legal disputes.   

  
  

4.2 Appointing the Certifier

The certifier is the legal authority responsible for issuing the various certificates required throughout the project. The developer can choose between a local council certifier or an accredited private certifier.

• Private vs. Council Certification: The research indicates a clear divergence in approach between the two options. Private certifiers are often chosen for their faster turnaround times, flexible scheduling, and the benefit of a single point of contact. Councils, by contrast, operate on a more rigid, administrative path with fixed schedules and potentially longer timelines. While a council certifier may be preferred for complex or politically sensitive projects, a private certifier is often the better fit when time, predictability, and hands-on support are a priority.   

  
  

4.3 Ancillary Consultants and Reports

Depending on the project and site, a range of additional specialist reports may be required as a condition of development consent.

Common Mandatory Reports: 

• A Structural Engineering Report may be required for older or multi-story buildings to ensure structural integrity. 

• A Waste Management Plan is often mandated for high-density developments to ensure efficient waste disposal. 

• An Acoustic Assessment Report is necessary for properties near busy roads to mitigate noise impacts on future residents.   

Site-Specific Reports: 

• More complex sites may require a Heritage Impact Statement if the property is located in a conservation area,

• a Biodiversity Assessment Report if it is adjacent to sensitive vegetation, or

• a Flood Risk Management Report if the area is flood-prone.   

  
  

5. Step-by-Step Guide to Lodgement

The strata subdivision process is a highly conditional and sequential chain of approvals. A single unfulfilled condition from the initial development consent can halt the entire process at the final stage.

5.1 The Initial Application Phase

• Online Lodgement: Since July 2021, the lodgement of DAs, CDCs, and all subsequent certificates is mandatory through the NSW Planning Portal. The process begins with the preparation and submission of the initial application for the development.   

  
  

• Draft Strata Plan: Unlike a Torrens title subdivision, a strata plan cannot be finalised until the building's construction is complete. Therefore, the initial DA or CDC application for the development must include a draft strata plan prepared by a registered surveyor. This draft plan provides the initial framework for the subdivision.   

  
  

5.2 During and After Construction

• Subdivision Works Certificate (SWC): If the development consent includes conditions for new infrastructure works (e.g., roads, reticulated water, sewer), a Subdivision Works Certificate (SWC) must be obtained before construction can begin. A Principal Certifier is appointed to oversee these works and ensure they are completed in compliance with the approved plans.   

  
  

• Occupation Certificate (OC):: The building must be safe and suitable for occupation before the final certification can be issued. An Occupation Certificate (OC) confirms that the construction has been completed in accordance with the relevant development consent and the Building Code of Australia. An OC is a mandatory prerequisite for the final Strata Certificate.   

  
  

5.3 Final Certification and Registration

The Strata Certificate: 

The Strata Certificate is the final regulatory sign-off. It is the certification that the building has been constructed and completed in accordance with the development consent or CDC and that all conditions of that consent have been met. The application for this certificate is lodged via the NSW Planning Portal.   

Mandatory Documents for Lodgement: 

The application for a Strata Certificate is a comprehensive package. It must include:

• a final plan of subdivision prepared by a registered surveyor,

• a Strata Certificate Administration Sheet,

• a Certificate of Compliance from the relevant water authority,

• a Schedule of Compliance that details how every single consent condition has been met, and

• a Section 88B Instrument for easements and covenants. 

The Schedule of Compliance is particularly important, as it serves as a formal, table-based document of proof for the certifier. A failure to meticulously document compliance with any of the initial consent conditions can result in a rejection of the application and costly delays.   

5.4 Lodging with NSW LRS

Once the Strata Certificate is issued, the final, endorsed plan and all associated documents are lodged with the NSW Land Registry Services (LRS) for registration. 

This is the ultimate step that legally creates the new strata titles and a folio of the Register for each lot and the common property.   

6. The Technical Details

The practical implementation of a strata scheme relies on a precise understanding of how boundaries are defined and how common property is managed.

The initial plan sets the stage for all future interactions and responsibilities.

6.1 Defining Vertical and Horizontal Boundaries

For a dual occupancy split between a ground and first floor, the definition of boundaries is a core technical task for the surveyor.

The strata plan must show separate floors from lowest to highest, with the boundaries of each lot clearly defined by a combination of "structural boundaries" (shown by thick lines on the plan) and "line boundaries" (shown by thin lines). 

This three-dimensional, "cubic space" definition means a lot owner's property is limited in height and depth by the upper and lower surfaces of the floor and ceiling. 

This is a departure from a Torrens title.

6.2 The Reality of Common Property

Common property is everything that is not a lot. While this typically includes visible shared spaces like driveways, gardens and stairwells, it also encompasses external walls, roofs and shared services (eg pipes and wiring). 

The Strata Plan, along with the by-laws, legally defines this shared space and the responsibility for its maintenance. 

The Owners Corporation has a statutory duty to maintain and repair all common property.     

7. Long-Term Implications

The long-term success of a strata scheme depends on its governance and the ability of its owners to manage the financial and social responsibilities.

7.1 The Two-Lot Strata Scheme

For dual occupancies, the scheme is a two-lot strata, which has unique legal characteristics.

The two lot owners automatically form the Owners Corporation, eliminating the need for formal elections or complex committee structures. This simplifies governance and decision-making.

The most significant financial exemptions for a two-lot detached scheme are that the Owners Corporation is not required to have a Capital Works Fund (a long-term savings fund for major repairs) or compulsory Building Insurance, provided both owners unanimously agree to forgo them. 

This creates a powerful financial incentive for developers to pursue a detached dual occupancy design, as it can lead to a significant reduction in ongoing financial overhead for future lot owners.   

7.2 By-Laws and Dispute Resolution

By-laws are the rules that govern the strata scheme and its residents. 

They can cover everything from the ownership of pets and noise complaints to parking and unauthorised renovations. 

Having clear and well-defined by-laws from the outset is crucial for creating a harmonious living environment.

Common disputes include noise, parking issues and unauthorised renovations. 

The process for resolving these issues is a graduated scale: starting with a direct conversation, escalating to the Owners Corporation or strata manager, and if necessary, proceeding to mediation with NSW Fair Trading or the NSW Civil and Administrative Tribunal (NCAT).   

7.3 Financial and Operational Pitfalls

Even with the most meticulous planning, strata projects can face a number of pitfalls.

• Financial Challenges: Project costs often exceed initial estimates. Unexpected expenses can arise from higher-than-anticipated council fees, additional infrastructure requirements, or the costly remediation of contaminated land. It is essential for a developer to have a comprehensive budget that includes a significant contingency fund to manage these surprises.   

  
  

• Inadequate Research: One of the most common reasons for project rejection is inadequate research. Failing to understand local council regulations, such as minimum lot size and lot width requirements, can lead to a project that is not legally permissible.   

  
  

• Neglecting Community Engagement: Ignoring community concerns can lead to opposition that results in costly delays or the rejection of the DA.

The strata subdivision of low-rise dwellings in NSW, particularly dual occupancies and townhouses, presents a powerful opportunity to maximise property potential and contribute to the state's housing diversity goals.