Increasing An Investment Properties Yield With A Granny Flat
Granny flats are ruling the residential markets in Australia. These are usually smaller residences constructed within the compound of another residential block. They can either be attached to the main house or be built in a detached area. What remains a constant is the self-contained feature. It is not just a room you separate or add to the main building. It is more of a secondary home that provide full housing on its own. These secondary dwellings are super popular due to fast construction that is considered cost effective. You can easily build one of your own to increase space or raise your cash flows after seeking permit from the local council. However, economy wise, does it really generate more yields? Most likely. Check below on some proofs.
They are trending
Everybody is talking about the granny flats around Australia. It’s an interesting topic that investors are willing to venture in. That is enough to show you how the idea has been endorsed. Ideally, people don’t adopt what doesn’t benefit them. How fast the internet, social media, smartphones and many other ideas have gone viral is a true indicator of that. It is only wise to conclude that there is light in the end of the tunnel after you have your own granny flat. Those who have built these flats have less to regret about. Even if they don’t receive enough rents, they got additional value for their homes.
Better than remodeling
Building a granny house gives you a wide range of choices. You can pick a conversion, extension, detached flat or convert your garage into a residence. All these options are cheaper than if you were to go for a home remodeling project. Rather than spending say $200,000 on a renovation project, you can build a granny flat from only $80,000. The latter will also come with added benefits including renting out and eventually it will return its invested capital.
There is ready market
Housing is ever a problem especially in urban places not only in Australia, but in every country. The population is ever rising globally which means even if more houses are being built annually, even more are being demanded every year. That said, a wise homeowner with plenty of space laying idle around the home will consider making it an investment. You have the land, the space and everything else. Just seek approvals and build one granny flat. People are continuously seeking affordable housing which is rare these days in urban settings. You can make some dollars out of the project.
Generating more yields is not something constant. It varies with the location of the flat, the size of it and so on. You should research on the expected amount of rent you can charge and do the viability test. If you are building a one bedroomed granny flat, research what a one bedroomed apartment costs a week and base your calculations on that rough figure. You can increase your yields by building a 2 story flat if it is allowed in your area.
The flat remains yours, and you can earn from it as long a long time.