In a household of two or more generations living together under the one roof, it’s tricky to keep everyone happy. A good solution is to look at your own backyard. If the space permits then building a granny flat, that can comfortably house one of those generations, may be your solution!
The great thing about building a granny flat is that each generation can enjoy the benefits of living as an extended family, whilst having some privacy. It can also minimise expenses for ageing members of the family by replacing an aged care facility with a custom-built granny flat. In some Australian states, homeowners can monetise this secondary dwelling, choosing to rent out the granny flat to paying tenants.
Whatever your reasons, we know that building a granny flat is not always easy - that’s why we’ve chosen to simplify the finance process. Speak to us today about our flexible finance options that have been purpose built to help you achieve your granny flat dreams.
Whether you’re looking to house the family, or start your own investment in the backyard, renters and homeowners alike are looking for savvy solutions for affordable housing and to enter the investment property market.
Today, multi-generational Australian households are increasingly becoming the norm. This is due to a range of reasons:
Enter – the granny flat. Once considered to be as tricky to complete as a full-blown reno, building your own granny flat is now more accessible than ever.
With a granny flat in your back yard, each generation can enjoy the benefits of living as an extended family, whilst having some privacy. It also gives the flexibility of using this space as short or long term rental accommodation. Separate living areas create independence and space, which may be important for mature, young adults and for you.
If you’re a baby boomer wanting to look after your ageing parents, a custom-built granny flat can alleviate the worry that often comes with an aged care facility. A granny flat purpose built for safety, comfort and accessibility, is often a more affordable alternative to aged care.
What about those stay-at-home young adults? A short residence in a granny flat could be the helping hand they need to get on to the property ladder. Time out from paying competitive rent will enable them to save a good deposit on a first home. Just be sure to have a conversation upfront about how long they need to stay and agree to a timetable of cohabitation. As the needs of your multi-generational family change over time, a granny flat can be rejigged for new familial requirements. The space can be transformed into a home office, or even a particularly savvy investment to help pay off your mortgage sooner.
In some Australian states, homeowners can monetise this secondary dwelling, choosing to lease the granny flat to paying tenants. Alternatively, if you don’t need that much space anymore, you may even wish to consider moving into the flat yourself and renting out the main house for a higher return. If you’re not up to the commitment of a long-term rental, consider short-term rental websites such as Airbnb and transform the space into a clever revenue stream.
And if you choose to put your home on the market, buyers will certainly be taking note of the granny flat in your backyard, which you might be able to count as an extra bedroom, study space or garden retreat.
Secondary dwellings can add significant value to a property, with investors seeing the potential of increased rental returns. So, whether you intend to build a granny flat for the extra space or even as a source of income, Gateway can help.
In 2009, the NSW government overhauled granny flat laws. The policy changes meant homeowners could gain approvals to begin building granny flats in as little as just 10 days, resulting in a boom of secondary dwellings. Thanks to the 2009 revisions, the only tough restrictions now relate to block size – granny flats may only be built on blocks larger than 450 square metres – and the size of the development – 60 square metres maximum.
Similarly, WA, NT, ACT and TAS also have quite relaxed policies on granny flat construction, supporting homeowners to reach the next step in growing their property’s capital.
In addition to the fairly simple proposal process, these three states and two territories allow homeowners to rent out their granny flats as separate properties for rental income, as long as they are approved for use as a residence.
If you’re living outside of these regions, see how your state compares below:
Legislation continues to vary state by state, and by local councils, but the potential return from a low entry point investment property such as a granny flat is becoming an increasingly attractive option to existing homeowners and renovators.