Development potential
Development potential (utbyggingspotensial) is how much more can be built on a site or in an area than what stands there today. It is the difference between current use and the use the zoning allows, and it is often the single factor that decides whether a property is of interest to a developer. A site with a small detached house, but where the plan allows an apartment building, has a large development potential even though the current buildings are modest.
The potential is determined first and foremost by the limits set in the zoning plan: the permitted land use purpose, the development density measured as BYA (built-up area ratio) or %-UFA, and height limits. If you apply the permitted density to the site area and subtract what is already built, you get a rough measure of how many extra square metres or dwelling units can be erected. But the legal limits are only the starting point. Physical conditions such as the shape, slope, ground conditions and access of the site, along with requirements for outdoor areas, parking, sunlight and distance to neighbours, can mean that the real potential is lower than the zoning allows in theory.
It is useful to separate zoned and unused potential on the one hand from potential that requires a change to the plan on the other. Within the current plan you can build out what the zoning already allows, which is relatively predictable. Greater potential often requires a new zoning plan or a dispensation, for example with densification or in a transformation area. Potential of that kind is more valuable, but also more uncertain, because it depends on a political planning process that can take years and that can end differently than expected.
Development potential is closely tied to value. A site price often reflects not just current use, but the expectation of what can be built. The relationship between expected development and what you pay for the site is usually assessed through a site analysis, where the potential is weighed against the costs of site preparation, demolition and sequencing requirements. A high theoretical potential gives little value if it cannot be realised financially or practically.
A common mistake is to read the theoretical maximum figure from the zoning as if it were fully realisable. In practice, requirements for outdoor recreation areas, parking, distance to neighbours, sunlight and fire safety eat into the limit, and sequencing requirements can trigger costs for roads, water and sewerage before anything can be built. The realistic development potential is therefore usually below what the zoning formally allows, and the gap between the two is exactly what a thorough assessment should capture.
In Placepoint you can assess the development potential on a property by viewing matrikkel data, the current zoning plan and development density together, and comparing the permitted density with the current buildings.
How it looks in Placepoint
In Placepoint you find this in the Property panel:
From Placepoint's dictionary: Development potential
More information: Planning and Building Act § 12-7 (provisions on land utilisation), Planning and Building Act § 12-5 (land use purposes)
English: Development potential (utbyggingspotensial; how much more can be built on a site than exists today, within or beyond current zoning).
Frequently asked questions
What is development potential?
It is how much more can be built on a site than what stands there today, that is, the difference between current use and what the zoning allows. It often decides whether a property is of interest to a developer.
What determines the development potential?
First and foremost the zoning plan: land use purpose, development density and height limits. Physical conditions such as the shape of the site, ground conditions and requirements for outdoor areas and parking can reduce the real potential.
What is the difference between zoned and unzoned potential?
Within the current plan you can build what the zoning already allows, which is predictable. Greater potential often requires a new zoning plan or a dispensation, which is more valuable, but more uncertain.
How does development potential relate to site value?
The site price often reflects the expectation of what can be built, not just current use. The relationship between potential and costs is usually assessed in a site analysis.
Where do I find the potential in a transformation area?
In a transformation area, the potential lies in the area being open to zoning for new and more intensive use, but that requires a planning process and depends on clean-up and infrastructure costs.