Australian family life is currently going through a profound restructuring. Up until a couple of decades ago, most households had the nuclear family model, made up of a husband and wife and their children, who typically left home when they reached their late teens. Because of the variability of the property market these days, this model has been rendered unsustainable for a lot of people, especially now that children are staying with their parents well into adulthood and the parents have a longer lifespan. As such, a lot of architects are coming up with creative alternatives and this has seen the once humble granny flat going upscale.
Are you planning on building one of these stylish beauties in your backyard? Below is all the information you need to know.
What’s different about modern granny flats?
The granny flat has seen an astronomical rise in the past couple of years. They are no longer the go-to place only for those overstaying relatives; these days they are cozy and stylish mini-homes. Because of their compact and flexible styles, it makes them more affordable for those families requiring residential choices at various life stages.
What are the benefits of a granny flat?
Financially, having a secondary residence will help to simplify budgets through the provision of income and investment — according to Avalon Granny Flats managing director Lee Janssen, most of his jobs are for homeowners who are middle-aged and whose goal is to take advantage of land values. For retirees, these residences can be a good way to downsize, or an option to have self-contained guest quarters. Another benefit of granny flats is that they allow for mutual care and support amongst family members, and also gives a safety net in case of emergencies.
There’s a study that found that there are certain divorcing couples who are opting for granny flats because they want to try to avoid the inconvenience of selling their family house, as well as the financial loss associated with the division of assets. They would rather build granny flats in order to ensure each other’s wish to live apart as well as privacy.
Will it increase the value of my property?
This will depend mostly on when the property is put on the market and who views it. Even though some will look at a granny flat as an addition, other prospective buyers would rather have an unhindered outdoor area. So, the value will be what works for you.
Can I just knock one up?
You can’t. Because there is a chance that people might end up building substandard dwellings which will be crammed into tiny blocks, local councils put conditions on the construction of these secondary dwellings. Although the regulations are different from state to state and council to council, all the conditions must meet the Australian Building Code. Granny Flats Sydney director Serge Panayi recommends that you conduct extensive research and check with your state planning authority, as well as your local council.
What conditions apply?
In Australia, the approval process through NSW Affordable Housing is the easiest and quickest. You can have a private certifier look at your plan to decide if it is compliant. If it’s decided that it is compliant, you will have approval within 14 days. Most companies can carry out the process for you.
While the NSW approval in not restricted by planned use, in Victoria they don’t allow rentals. According to Panayi, differences between councils make the process complicated. These prohibitive rules surrounding granny flats are being reviewed by the Victorian government. However, at the moment the flats are available only to house owners’ dependents and they have to remove the dwelling when they leave.
In terms of size, the maximum in NSW is 60 square metres, the lot area being a minimum of 450 square metres and with a width of 12.5 metres. In certain instances, you are allowed to build two storeys, but it will be subject to certain height limitations, as well as set-backs. You are not allowed to build a deck or porch in that area.
The Brisbane Council limit is 80 square metres, below 20 metres from the main house, on a bigger than 600 square metre block, and these are only available to dependents for rental. As for the Gold Coast Council, it has to be below 50 per cent of the main house and you will be sharing the driveway, water and sewer. The Toowoomba Council stipulates that you can rent it, but there will be an infrastructure charge of $20,000 or above levied.
Can I build more than one?
You can’t. In many cases, the regulations will limit you to two separate buildings on one property. If the blocks are not more than 450 square metres, the local councils may even prohibit you from building a separate granny flat. If you have an elderly parent who requires care, a self-contained unit constructed as part of the original construction, or a self-contained extension on your main house might be the ideal option. This is because you can provide a connected living space plus internal access.
Can I subdivide and put the flat on a different title?
Yes, however it will not be regarded as a granny flat, which is basically an attached or detached part of the main home which shares the title and infrastructure. In order to gain approval for the subdivision, you will have to undergo a process that is quite expensive and lengthy.
Can I rent out a granny flat?
Not in all states. For instance, there are prohibitions that apply in Queensland and Victoria. Renting out will be subject to a particular state’s Tenancy Act Provisions, which covers things such as security, utilities, parking and health.
Can I get finance for a granny flat?
You can, however there are certain lenders who will charge higher interest rates for investment properties compared to family occupation. At the same time, others provide mortgages at a similar interest rate, so it’s best to shop around. You also have to take into account the tax implications as well. When a primary home is sold, there will be no capital gains tax that applies; this is according to Paul Thomas, Gateway Credit Union CEO. Granny flats that are utilised for income will attract tax.
Could I comfortably downsize into a granny flat?
A well-constructed granny flat will be able to meet changing requirements over a long period of time. It may begin as a guest unit or teen retreat. However, elderly owners may end up downsizing in their very own backyards. Councils are usually agreeable to secondary buildings for the elderly. For those planning to retire to modern granny flats, it is important to take into account inclusions like ramps, wider doors, grab rails and accessible showers at the start of the design process as this will help save money down the line.