Building a granny flat/unit in house backyard

[miket]

I have a positive geared Californian Bungalow renter in good ol' Melb by the Westgate Fwy in Yarraville. Top locale with a deep block that looks as big as a paddock.
Was thinkin', what about sticking a granny flat in the back yard, say a 1 bedder with kitchenette, lounge and the usual WC and pantry laundry.
Guess first step would be to approach the council if ok to do.

Anyone done this kind of small time developement?

Ta,
Mike

 

[Kristine..]

Hi Mike

A 'Granny Flat' is for grannies. The criteria of the accommodation is that it be for occupation of immediate family members only, and that it be removed when that person or any other nominated family will not be occupying it.

It is not an excuse for defacto subdivisions.

also

Your tenants are renting the whole property. Their permission would be necessary and they may certainly withold it.


By the time you mess about doing something like this, you could have put an application & plans for genuine subdivision in to council and obtain permission to build one or two units behind the original house.

It's good to look for ideas to add value, but some ideas are more trouble than they are worth.

cheers

Kristine

 

[asy]

Kristine is right, IF you have current tenants in place.

If you want to do this kind of 'expansion' you should wait till you are 'between tenants' and do it then, so that when the new tenants move in, their boundaries are clearly defined.

If you can't wait that long, however, approach the current tenants, and let them know what you are planning and offer them a rent reduction commensurate to the % of land and 'quiet enjoyment' they will lose...

asy

 

[miket]

Yep, got all that.

So without worrying about what the current tenants think (that's easy to sort out), let's focus on the investment side of the matter.

Block is 120 ft deep and the current house takes up the front 60 ft. I called it a Granny Flat, let's call it a studio or flat or unit, doesn't really matter.
The plan is to provide one more dwelling to the title of land, derive extra income and increase the value of the property. Increase equity etc.

I realise there are many negative issues if we let them hold us up but are there any positive ones? We can't let a simple negative issue hold us down otherwise what kind of investors would we be?

I figure the build cost would be less than 100k. Extra rent 6k per annum. Added value/CG to property in the next few years in excess of 100k. But I'm buy and not sell investor.

This is the trail of feedback thought I was hoping to get back from you guys. Sure, if there are better, easier ways of adding gain to the place that's already renovated then let's have 'em.

'STCA' of course.

Thanks

MikeT

 

[Aceyducey]

Mike,

You'd have to do a sub division or dual occ, depending on the block size, the council & the location of the dwelling. Councils frown strongly on people adding a second dwelling on the same title in suburbia - the main times it can be gotten through is for a PPOR when you want an elderly family member onsite (so to speak) - hence the guys' comments on granny flats.

It basically gets down to the numbers & the time.

Is it worth you funding the process for the rental return & equity you may gain?.....that's a question I don't think anyone can answer or even hazard a guess about without a lot more info on your specific property - block size, and council in particular.

It may be better value for your bucks to knock down/shift the existing dwelling & build some townhouses instead.

Or extend the existing dwelling.

Cheers,

Aceyducey

 

[XBenX]

Id do the sums first (shouldnt take more than a few hours) - if it looks attractive then see if what you are proposing will be approved.

The raw site to DA approval process has been documented on the site many times, do a quick search and if you cant find it post away Im sure someone will help or repost the info.

 

[ok180]

How would you split things like the water and electricity bills... You wouldnt know who was using what.

 

[Olly]

Before you get too excited you'd better check with council. Mine allows dual occupancy, duplexes, triplexes etc depending on the size of the land, but doesn't allow granny flats!! The only way around this in my council area is to attach it to the house and call it an extension.

Olly

 

[miket]

Here's what the back yard looks like.

A drive around the municipality shows there are such dual occupancies about.

Next I'll check with Maribyrnong Council on it's dual occupancy policy. Also do some figures on the building etc. Water and Power will have seperate meters to the main dwelling.

Some good points made on this 'idea', thanks guys.

Mike

 

[ok180]

.

Water and Power will have seperate meters to the main dwelling.



Mike

Can you do that?

I didnt think you could make them seperate unless they were actually dual occ or subdivided.

 

[Aceyducey]

Can you do that?

I didnt think you could make them seperate unless they were actually dual occ or subdivided.

You can put in sub-meters....they're not always happy doing so though

Cheers,

Aceyducey