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The granny flat has come of age. Once a humble backyard lodging for grandparents or teenagers, the granny flat is gaining major attention as a convenient, low cost, high yield property investment. Here are six reasons you should consider a granny flat investment in your backyard:
- Low cost, low risk, low stress
Building a secondary dwelling on land you already own lets you enjoy the benefits of a stand alone investment property with a much smaller outlay. Well designed, high quality “modular homes” and “eco cabins” offer turn-key completion and finance options that can have your granny flat investment generating income quickly – all at a fixed contract price.
- Add value to your current home
A high quality granny flat can add significant value to your home. Appearance, inclusions, location, the level of privacy afforded and potential rental income are all factors to consider as part of your planning. A granny flat that can also be used as a home office, studio or family accommodation is likely to be appealing to future buyers.
- An extra income stream
Whether you rent it out to a full time tenant or as a short term holiday rental, a granny flat offers potential for a steady income stream. A popular strategy is to structure finances so the rental income pays off the investment loan. This can be achieved in a relatively short time, especially while interest rates are low.
- Enjoy the tax benefits of a bigger investment
A good accountant can guide you through the tax implications of a granny flat investment, including capital gains tax and tax deductions via expenses and depreciation. A granny flat investment can be negatively geared to reduce your overall tax bill and you may be able to claim a portion of common expenses such as gardening or swimming pool maintenance.
- Easy to look after
Speaking of maintenance, a secondary dwelling in your backyard is easy to take care of simply because of its proximity to your house. By starting with a high quality structure and carefully managing the granny flat’s use and tenants, maintenance issues should be minor and infrequent.
- Convenient – it can grow with you
One of the best things about a granny flat is that it can be used in so many different ways. It can grow with you as your needs change. You can rent it out when you need extra income, use it as an office or project space, house elderly relatives, get noisy teenagers out of your hair and then live in it yourself if you decide to downsize during retirement.
Speak to us about how a granny flat may be the investment opportunity you’re looking for.