Have you ever thought about expanding your property’s potential in a way that not only adds value but also generates income? Imagine having a versatile, self-contained living space right in your backyard, offering endless possibilities for extra earnings or accommodating family members. If this sounds interesting to you, you might consider building a granny flat.
Also known as accessory dwelling units, granny flats are increasingly capturing the attention of homeowners and property investors alike thanks in part to The Block Australia which features these versatile units. Let’s learn more about the potential of a granny flat as an investment property as well as the essential factors to consider before building one in your backyard.
First off, a granny flat isn’t the only option available to you if you want to maximise your property’s potential. There are two other property types that you can consider if you want to add a rental property to your investment portfolio:
A granny flat has multiple purposes. Originally, it was built to serve as a separate living space for family members, allowing for close proximity while maintaining individual privacy and independence. For elderly homeowners, granny flats offer a convenient way to age in place gracefully, with easy access to family support and medical care.
Today, and as seen on the Block Australia, these self-contained units are popularly transformed into dedicated home offices, art studios, or guest houses for visitors.
The size of the average granny flat typically ranges from 35 to 70 square meters. These dimensions are in line with local regulations and zoning laws, which often specify maximum allowable sizes for these units. However, it’s important to note that the specific size may still vary depending on factors like the property’s available space, local building codes, and the homeowner’s or investor’s preferences.
The cost of building a granny flat in Australia can range from $20,000 to $290,000. The cost can vary widely based on several factors, including location, size, materials, design, and labor costs.
Also, construction costs can fluctuate over time due to changes in material prices, labor costs, and other factors. If you’d like to learn more specifics about the cost of building a granny flat, you can read the “Ultimate Guide to Costs to Build Granny Flat – Plans and Prices.”
Before you start building a granny flat, it’s crucial to take a moment to consider the essential factors that will affect your project. These considerations are the foundation of a successful granny flat venture:
Choosing the right granny flat design is a top priority. It’s essential to decide between a custom-built granny flat and pre-fabricated kit options. Custom designs offer flexibility, transparency, and the ability to tailor the space to your specific needs. With custom granny flats, you have control over layouts, finishes, and inclusions, minimising the risk of unexpected costs during construction.
This approach ensures that your granny flat is not only functional but also ideally suited to its intended purpose, whether it’s generating rental income, accommodating family members, or serving as a dedicated workspace.
The choice of builder plays a vital role in the success of your granny flat project. Make sure that your selected builder holds the appropriate building licenses, boasts positive references and reviews from past clients, and maintains an informative website that showcases their expertise.
Not all granny flat companies adhere to the same standards, so it’s essential to choose experienced specialist builders. This decision will not only contribute to a smoother construction process but also result in a space that aligns with your vision.
The size of your granny flat is a critical consideration that significantly impacts the overall cost of the project. Whether you’re envisioning a cozy 1-bedroom granny flat or a more spacious 3-bedroom unit, various factors such as site costs, design complexity, approvals, build price, and standard inclusions will differ. Carefully assess your needs and goals to determine the optimal size for your granny flat. This will help you strike the right balance between functionality and budget.
Your choice of foundation material and type can have a substantial impact on the cost of building your granny flat. For instance, a concrete slab foundation is typically more cost-effective for flat sites, while bearers and joists might be necessary for sloping terrain. Bear in mind that choosing the right foundation can eliminate the need for excavation and retaining wall expenses. By evaluating your property’s topography and consulting with experts, you can make an informed decision that not only ensures stability but also manages costs effectively.
Taking these considerations into account before starting your granny flat project will help you make informed decisions, avoid unexpected expenses, and ultimately create a self-contained space that aligns with your goals and budget.
The question of whether a granny flat is a worthwhile investment property ultimately depends on your specific goals, financial situation, and investment portfolio strategy.
For many, granny flats offer a positively geared investment opportunity, meaning the rental income generated typically exceeds the expenses associated with the property. This can result in a steady stream of additional income, making it an appealing choice for those seeking to maximise their returns.
But thinking about the considerations mentioned in this article as well as different factors, such as the local property market conditions, regulatory requirements, and your long-term objectives, is a crucial step before making this investment decision. Assessing the impact of a granny flat on your existing investment property and carefully evaluating the potential returns are critical steps in the process.
At Vision Property & Finance, we specialise in helping individuals make well-informed investment decisions, including those related to granny flats. If you’re inspired by the opportunities presented by granny flats and ready to unlock their investment potential, let us guide you.
We offer tailored advice and financing solutions that take into account your unique circumstances and preferences, helping you optimise your investment goals effectively. Whether you’re a homeowner looking to upgrade or a property investor seeking to enhance your investment portfolio, we’re here to assist you every step of the way.
Want more information on expandable granny flats? Click the link below to contact us.