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Rental Returns- Can you double your income ?

Rental Returns- Can you double your income?

Granny Flats and Cabins

Particular to the Central Coast Peninsula is the influx of the legal granny flats. Particular in that the Peninsula has always been a wash with ‘cabins’ because of the prevalence of rear lanes. As a general rule, Granny Flats are legal developments, and ‘cabins’ are illegal. Sometimes you may hear cabins described as ‘sleep-outs”.

Granny flat developments are built under the NSW State Environmental Planning Policy (SEPP). The SEPP has brought about the demolishing of a lot of the old illegal ‘cabins’ and seen them replaced with brand new stylish two-bedroom granny flats. The banks happily finance these granny flats, and on average cost between $110,000 – $150,000 depending on the style of the granny flat. Rental returns are between $350pw- $400pw depending on the finish and the inclusions.

 

So, what are these Granny Flats you may ask? A granny flat is self-contained accommodation within, attached or separate to an individual home. A private certifier can certify granny flats as a complying development without the need for a development application to Central Coast Council, provided they meet the specific development standards in the State Environmental Planning Policy (Affordable Rental Housing) 2009.

 

The cabins are often converted garages. They are often constructed from building materials made from asbestos and have inherent issues with air-flow and size. The ‘cabins’ do however have their place socially in that they are significantly lower rent than a granny flat and meet the needs of many financially disadvantaged people living on pensions or seeking low cost housing. We may add that they are not all bad, many are well built prior to the SEPP when Council ruled the roost.

 

The new granny flats are also used by property owners who wish to house their early adult children or elderly parents. The provide a vehicle for people to stay at home with family in a property market that is increasingly out of reach for many Australians.

 

If you are thinking of building a granny flat and would like some free advice as to rental returns and the type of tenant that could be located, then contact one of our property managers for a free no obligation rental appraisal. It is possible to significantly increase your rental return through the construction of a granny flat.

 

More information is available here:

https://dpe-files-prod1.s3-ap-southeast-2.amazonaws.com/s3fs-public/documents/2016/May/Granny_Flats_Generalinformation.pdf

https://dpe-files-prod1.s3-ap-southeast-2.amazonaws.com/s3fs-public/documents/2016/May/Granny_Flats_Building_Articulation_Corner_Lots.pdf

https://dpe-files-prod1.s3-ap-southeast-2.amazonaws.com/s3fs-public/documents/2016/May/Granny_Flats_Building_Heights_and_Setbacks.pdf

https://dpe-files-prod1.s3-ap-southeast-2.amazonaws.com/s3fs-public/documents/2016/May/Granny_Flats_Privacy_Requirements.pdf