Build a Granny Flat on Current Block of a Property Vs Buy Another House? [Darwin]

vchar on 10/08/2023 - 13:24
Last edited 10/08/2023 - 17:35 by 1 other user

Hi folks, not sure if I've categorized my post correctly, please advise if not.

I'm considering to build an additional dwelling within the current block of my property vs buy another property (new/established) but I'm not very sure about pros and cons of each option given they have the same acquiring cost. It would be great if you guys can shed some light or share with me your experience so that I can use them to weight on my decision.

My purpose is that I want to add extra income through renting while expecting that it will be appreciated in value over a long term.

Also note that I can only build a granny flat roughly 80m2 in size in my current property.

Cheers,
V

Financial

Comments

  • BLAIL on 10/08/2023 - 13:35
    +2

    Yeah just build a granny flat for 100K or less instead of buying a new/existing property somewhere else for 10x the cost

    something like this - https://grannyflatsaustralia.com.au/floor-plans/indigo/

    • vchar on 10/08/2023 - 13:51

      I was quote like AUD 2200 per square minimum to build a granny flat. I've learnt that some establish 2-bedrooms apartment could be acquired at around AUD 230000 although they are quite old.

      • BLAIL on 10/08/2023 - 14:00
        +2

        What state you in? Thought you meant house thats why i put the 10x the cost of a 100k. - example i linked is 60m2 so $132k based off what you got quoted.
        Still cheaper than the old apartment you're looking at.

        • vchar on 10/08/2023 - 16:10

          NT or more specific Darwin.

      • star-ggg on 10/08/2023 - 15:57
        +2

        if they're quite old, you'll have to factor in the cost to fix them up to the same level as a newly built granny flat. Compare apples with apples.

  • Drakesy on 10/08/2023 - 13:54

    The stamp duty would be the killer, i'd go for existing block.

  • sumyungguy on 10/08/2023 - 14:01
    +1

    I'm planning to do this myself in 2024. No real estate transaction fees. You're taking advantage of having purchased sufficient land in the first place. You're increasing the density of the 'burbs which provides more housing. You'll have a dual occupancy dwelling, live in one, rent out the other and DIY property management. When your circumstances change, you could move into the secondary dwelling and rent out the primary. When you shuffle off, your beneficiaries can continue as slum lords, renting the two dwellings without the pressure to sell. Getting your primary dwelling ready for sale is way more work and expense than preparing for rent. Just make sure the secondary dwelling is something you'd want to live in. Here's one of my fave YouTube channels which may inspire you: Never Too Small Also, a friend just completed one this year, they had a cabin (1-bath studio with kitchenette, $70K) added to their backyard: https://www.adamscabins.com.au

    • netjock on 10/08/2023 - 14:36

      Depending on what you want you might want to get cracking now to get planning sorted.

      Victoria is banning gas connections for anything that isn't planning approved this year. 7 start minimums coming in next year I believe. Currently you can still get away with 6 star (it depends on how challenging your build is).

      If you want to build small might not be a problem but if you want to optimise for size on the block might cause an issue.

      HIA also believes the construction pipeline will dry up in 2024 therefore less challenging timeline / material shortages. If you want to build might be time to get all your planning and technical drawing together.

      I got mine approved start of this year. Technical drawing done. Just waiting until mid 2024 to break ground.

  • capslock on 10/08/2023 - 14:16
    +1

    Building in the current environment seems risky what with rising costs and a labour & materials shortage.

    Buying seems less risky.

    • netjock on 10/08/2023 - 14:33

      Unless moving in 7 years do owner builder.

  • MondaySleeper on 10/08/2023 - 20:24

    Anyone knows what is the current cost of 60m2 2 Bedroom granny cost please? Googling gives different results. Propertychat forum says 200K. is it true? Any OZBargainer did it recently?

  • sumyungguy on 10/08/2023 - 20:27

    $170K indicative for 65m2, but acknowledge the Nordic vibe isn't for everyone and this is a Qld price: https://www.adamscabins.com.au/cabins/lady-elliot-2-bedroom-…
    $200K is probably not far off

    • MondaySleeper on 10/08/2023 - 21:23

      Wow… that is a great return mate. My friend has a Brick granny with separate driveway access (direct from main road being a corner site) but he is getting $370 in Colyton NSW.

  • Rear CreviceEruption on 11/08/2023 - 05:43

    Sure you want people living in your backyard? You will lose your privacy in your garden, and around the house. Seems a lot to pay and sacrifice to get a rental income.

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