Development feasibility
Feasibility is the development control document. It tests whether the project still makes sense after land, design, planning, infrastructure, construction, finance, tax/accounting, selling, programme, and risk are considered.
Educational calculator
This is an educational estimate only. Confirm with a quantity surveyor, accountant, lender, valuer, lawyer, planner, and other relevant professionals before making decisions.
Gross realisation value
$2,850,000
Total development cost
$3,682,000
Estimated profit
-$832,000
Margin on cost
-22.6%
Margin on revenue
-29.2%
Contingency allowance
$157,000
Indicative loan
$2,393,300
Equity required
$1,288,700
Equity gap / surplus
$388,700
Delay interest estimate
$53,849
Worst-case profit
-$1,106,849
Residual land value estimate
$15,700
This is an educational estimate only. Confirm with a quantity surveyor, accountant, lender, valuer, lawyer, planner, and other relevant professionals before making decisions.
Check whether the land price looks supportable before making or confirming an offer.
This is an educational estimate only. Confirm with a quantity surveyor, accountant, lender, valuer, lawyer, planner, and other relevant professionals before making decisions.
Organise all cost categories so construction cost is not confused with total development cost.
This is an educational estimate only. Confirm with a quantity surveyor, accountant, lender, valuer, lawyer, planner, and other relevant professionals before making decisions.
Estimate gross revenue, profit, and margin after all entered costs.
This is an educational estimate only. Confirm with a quantity surveyor, accountant, lender, valuer, lawyer, planner, and other relevant professionals before making decisions.
Work backwards from revenue and required margin to estimate a supportable land price.
This is an educational estimate only. Confirm with a quantity surveyor, accountant, lender, valuer, lawyer, planner, and other relevant professionals before making decisions.
Estimate possible loan amount and equity need before lender advice.
This is an educational estimate only. Confirm with a quantity surveyor, accountant, lender, valuer, lawyer, planner, and other relevant professionals before making decisions.
Show what happens when sale prices fall, build costs rise, interest increases, or the project is delayed.
This is an educational estimate only. Confirm with a quantity surveyor, accountant, lender, valuer, lawyer, planner, and other relevant professionals before making decisions.
| Item | What it means | Where to find it | Who confirms | Caution |
|---|---|---|---|---|
| Gross realisation value | Estimated total sale value of all completed dwellings before selling costs or tax. | Comparable sales, agent appraisal, valuation, presale feedback, completed project evidence. | Valuer, real estate agent, lender. | Do not use optimistic asking prices as confirmed GRV. |
| Land cost | Purchase price plus acquisition costs that must be funded before development value is created. | Sale agreement, lawyer estimate, lender terms, settlement statement. | Lawyer, lender, accountant. | Include deposit, settlement timing, legal fees, due diligence spend, and holding costs. |
| Construction cost | Cost to build the dwellings and related site works under the intended scope. | QS cost plan, builder tender, contract, specifications, engineering assumptions. | Quantity surveyor, builder, architect, engineer. | Separate house build cost from demolition, earthworks, retaining, civil, services, landscaping, and driveways. |
| Professional fees | Consultant and professional advice costs across acquisition, design, consents, construction, sales, and closeout. | Fee proposals from planner, architect, surveyor, engineers, QS, lawyer, accountant, valuer, agent. | Each consultant and the project manager/development manager. | Include RFI responses, design changes, meetings, site observations, and closeout support where excluded. |
| Council, consent, and approval fees | Fees for resource consent, building consent, engineering approvals, monitoring, inspections, and related council processes. | Auckland Council guidance, consent fee schedules, consultant estimates, project-specific invoices. | Planner, architect, civil engineer, council, developer. | Insufficient data to verify exact amount — check current council requirements and project-specific consent pathway. |
| Infrastructure costs | Costs for water, wastewater, stormwater, power, fibre, vehicle crossing, road corridor works, upgrades, and as-builts. | Civil engineer advice, Watercare/utility correspondence, AT/council requirements, BeforeUdig, tender pricing. | Civil engineer, utility provider, Watercare, Auckland Transport, QS. | Carry a risk allowance until service capacity and connection details are confirmed. |
| Finance costs and interest | Interest, establishment fees, line fees, valuation/QS reporting fees, broker fees, and other funding costs. | Lender term sheet, broker advice, cashflow forecast, loan documents. | Lender, mortgage broker, accountant. | Sensitivity test interest rate and project delay because time can change total interest materially. |
| Contingency | Allowance for unknowns, design development, price movement, consent conditions, site issues, and construction risk. | Risk register, QS advice, lender requirements, developer policy. | Developer, QS, lender, accountant. | Do not spend contingency on scope upgrades without recording the decision and remaining risk. |
| Marketing and selling costs | Agent commission, advertising, photography/renders, staging, legal sales documents, listing costs, and buyer communication. | Agent proposal, marketing budget, lawyer estimate, sales strategy. | Real estate agent, marketing agent, lawyer, accountant. | Include longer campaign costs if the market slows or presales are required. |
| Legal, accounting, GST, and tax considerations | Project-specific legal/accounting/tax treatment, entity costs, GST, income tax, record keeping, and settlement accounting. | Lawyer advice, accountant/tax adviser advice, IRD guidance, project accounts. | Lawyer, accountant, tax adviser. | This guide does not give tax advice. Confirm before purchase, before sale, and before finalising feasibility. |
| Holding costs | Rates, insurance, interest, utilities, maintenance, security, temporary works, and other costs incurred while holding the project. | Rates records, insurance quotes, cashflow, lender terms, historical costs. | Accountant, lender, developer. | Holding costs increase with delays and can quietly remove profit. |
| Developer margin | The developer's target return after costs and risks. Always state how it is calculated. | Feasibility model, investor requirements, lender review, developer policy. | Developer, accountant, lender where relevant. | A low margin may not justify planning, market, construction, finance, and settlement risk. |
Planner, surveyor, architect, engineer, quantity surveyor, lawyer, accountant, lender, valuer, real estate agent, and other project specialists must confirm site-specific decisions.
Use IRD property guidance for tax topics such as income tax, GST, rental income, property sales, and entity records. Confirm project-specific treatment with an accountant or tax adviser.
Check council guidance, application requirements, RFI process, consent conditions, approved plans, engineering approvals, and monitoring requirements for site-specific development approvals.
Use Watercare and civil engineering advice to verify water and wastewater connection requirements, network capacity, approvals, fees, and construction standards.
