Are granny flats a good investment opportunity?
So generally to move, to build a granny flat, you are talking about a $100,000 and generally we are getting about $20,000 rental return on them.They are a very safe tangible investment.
A lot of people over the last couple of years have lost their money, a lot of money in the share market and been exposed to that kind of risk and they are going back to a nice secure safe investment nest and we are providing that. Also just the ability to get a granny flat approved within one month and being able to have a tangible asset ready to move into within 3 months is making a very attractive and very affordable option.
What areas are seeing the best returns on granny flats?
Here we have people property source properties to, just to get into the right locations and not to overcapitalise in certain areas, but they working across the board in New South Wales very strongly. [Innovest] is working very well all the way to, out of western suburbs. And then once you come to the eastern suburbs and the beaches area, it’s got to be just designed in accordance with existing suburbs and just accommodate for the demographics around there. But they are all getting fantastic yields, regardless of where they are putting, being put because they are custom designed and custom built. That’s why they are able to achieve higher yields in the northern areas compared to out in the west as well.
Why should investors consider NSW?
Like we are only focused on New South Wales and the reason being is that New South Wales is the only state that allows complying development. We don’t have to go through Council. In 2008 we were part of writing a new law that overrid the Council approval. The state government has a housing shortage across Sydney, across New South Wales and they just needed a way to fast track the approval process and to create more homes. And that’s why we were consulted and asked about how can we improve the system and that’s why they came out with 10 day approval process which is a guaranteed approval as long as you meet a few certain criteria.
What is the criteria?
Well so they are very simple. The plot has got to be over 450 sq.mtrs., got to have more than 12 mtr. frontage and a granny flat can’t be more than 60 sq.mtrs. There is a few other minor things to note, but they will be looked at through certification process.