How to Do Valuation of Property with a Granny Flat

MondaySleeper on 11/08/2023 - 13:52
Last edited 11/08/2023 - 14:38

Hello :)

Just wondering if you can provide some insights on the price for an investment property with granny around St Marys, Colyton St Clair area.

1) If the 3 BR house normal cost is 800-840K, how much extra we need to pay for a house with a granny (concrete). Also, with separate road access or with common drive day/street parking?

2) Is it better to buy the house and then add the granny later?

3) How much to build a 2 BR granny flat. I know it depends on the type and Brick or not etc. But can we safely say 170-200K?

The reason I am asking is that I missed out on a few recently. Last week I made an offer for this house and its gone. Granny has separate driveway from road. I made offer for around 1Mil 50K but didn't get it :( . Probably gone for 1.07 or near or 1.1M. Their range was 1-1.1M

https://www.domain.com.au/colyton-nsw-2760-2018675884

Is there a tool that helps to value the house with Granny? All tools give the value of main house only.

Edit: Gifted the word Flat to "Granny" in the Title to avoid the comments of "Grandpas" :)

regards….
Sab2000

Home & Garden

Comments

  • MS Paint on 11/08/2023 - 13:58
    +10

    How to Do Valuation of Property with Granny

    Kindly ask your grandmother to attend the valuation appointment with you.

    • DashCam AKA Rolts on 11/08/2023 - 14:10
      +4

      granny (concrete) - don't mess with this granny definitely a hard ar$e.

    • MondaySleeper on 11/08/2023 - 14:39

      lol.. edited the title and comments section..

  • Duckie2hh on 11/08/2023 - 14:10
    +1

    Why do you need a granny flat for an investment?

    • boomramada on 11/08/2023 - 14:32

      I have used it as storage for a decade. :)

    • MondaySleeper on 11/08/2023 - 14:45
      -3

      It increases the cashflow. Also an investment for next 6-10 years.

      • AustriaBargain on 11/08/2023 - 16:42

        You mean you want to rent it out? And the house is you living in it or renting that out too? You have to imagine that a house with a granny flat on it with strangers living in it would devalue the main house, though if you're counting on massive housing shortages over the next 20 years then I guess it doesn't matter. People would live in a furnished shipping container if that's the only option.

        • MondaySleeper on 11/08/2023 - 18:23

          Yes, planning to rent out both if i get a house + granny. What made me interested in this house is that it has been structured as if they are 2 Separate houses. Both party get full privacy. No worse than duplex. Probably better than duplex as they share the wall at least.

      • Sinnerator on 12/08/2023 - 08:32
        +1

        Cashflow???
        Check your local council laws about renting out a granny flat to strangers.

        • MondaySleeper on 12/08/2023 - 09:17

          its a council approved one. No issues with renting out. It has separate electricity metre, nbn, and water (internally metered).

          • singingwolf on 12/08/2023 - 18:52

            @MondaySleeper: We were advised that separate NBN can only be supplied if the granny flat has a separate land title (i.e. like a unit block).

            • MondaySleeper on 12/08/2023 - 19:33

              @singingwolf: My understanding is that if you have address like 20A xyx road it means it has a separate adress. If you go to nbn or electricity provider site, they recognise this address and provide service. I may be wrong though.

              • singingwolf on 12/08/2023 - 20:13

                @MondaySleeper: A means subdivided. Ours is 1/20 as an example. Council said they won't allocate another property ID with separate rates etc. It's weird as it has a phone before NBN

                • MondaySleeper on 12/08/2023 - 21:03

                  @singingwolf: This is in NSW, Penrith council. I think subdivision means it has its own title. But this both houses on same title. I had checked the contract when I inspected. Not sure how these things work. If I search this address on NBN site (20A), it comes up.

  • jv on 11/08/2023 - 14:12

    How to Do Valuation of Property with Granny

    Ask Grandpa.

    He will have many more decades of experience than you.

    • DashCam AKA Rolts on 11/08/2023 - 14:20
      +1

      Is Grandpa still wearing an onion on his belt?

      • jv on 11/08/2023 - 14:21
        +2

        Was that the style at the time?

        • DashCam AKA Rolts on 11/08/2023 - 14:22
          +1

          Definitely, but it was hard when you could only get the yellow ones.

    • MondaySleeper on 11/08/2023 - 14:40

      jv… you too :)

  • brendanm on 11/08/2023 - 14:23

    Can she cook?

    • jv on 11/08/2023 - 14:24

      Can she cook !!!

      It is a statement, not a question…

      • brendanm on 11/08/2023 - 14:25

        Double the value of a house without a granny then.

      • MondaySleeper on 11/08/2023 - 14:42

        Probably Flat-out Granny.

  • boomramada on 11/08/2023 - 14:29
    +1

    The reason I am asking is that I missed out on a few recently.

    Cost of the building a granny flat is irrelevent when you offer is under the market value.

    • MondaySleeper on 11/08/2023 - 14:49

      Well, that is the concern and I a looking for that magic formula.

      I can get a reasonable value for the main, but then granny flat is added the calculation is going wrong. This is what I think.

      I thought probably seasoned investors here could give some tips.

      • boomramada on 11/08/2023 - 15:01
        -1

        I'm not sure why you worry about it, Its rare to find a house with Granny Flat, I wasn't looking for one but I got one, and it was useful. Its seems person who bought it valued it more than you did. Better luck next time.

        • MondaySleeper on 11/08/2023 - 15:11

          Not worried about it at all. Just trying to arm myself with better info so that I can give the an offer that will not be rejected. Part of learning.

          BTW, did you buy it? :)

          • boomramada on 11/08/2023 - 15:27

            @MondaySleeper: I sure bought it, at that time I was looking at two properties, within the same surburb, one with and one without a flat, same price, I offer less for the one with the flat, and seller accept it, I think they were rush to sell it. I did like the house with the flat more than the other.

            It funny story tho, though I discover Grannay flat has a bathroom and heating year after I bought it LOL

      • Typical16-bitEnjoyer on 11/08/2023 - 18:53
        -1

        magic formula = offer what the vendor will accept + offer higher than the opposition.

  • Porker on 11/08/2023 - 14:31
    +5

    If they list a range of $1 to $1.1mil, they're really expecting in the order of $1.2mil.

    I think you're valuing the granny flat based on your needs for the property. As example, it might be good investment to run two rentals on the one property. However, not all buyers are seeing the same thing as you - some might simply want the land because of the location regardless of what's on it.

    With property, there is generally no 'value' as such that one can really appoint to it. As example, 1kg of gold is $X but for properties, the cost is only as much as someone is willing to spend on it. If there's high demand, then the price will trend up, but if no demand, then the price will trend down.

    • MondaySleeper on 11/08/2023 - 14:44

      yes, True. But I cant still comprehend the logic of paying that much… Maybe its me.

      • SBOB on 11/08/2023 - 15:33

        But I cant still comprehend the logic of paying that much

        but could with an offer 50-100k less? Its just margins of error on comprehendible logic/justification of paying crazy prices for real estate

      • Porker on 11/08/2023 - 16:06
        +1

        With respect, I'd say it is indeed you - you may find more perspective of the market by going to a few auctions etc to experience the demand that exists out there.

        $1mil doesn't buy much these days (for major cities) - property prices are up-up-and-away.

        • MondaySleeper on 11/08/2023 - 16:09

          I think you are right. I have my brain set like it. Going to attend some auctions tomorrow and some open-homes.

    • star-ggg on 11/08/2023 - 15:08
      +1

      The value of a property is the amount that someone is willing to pay for it. You could spend forever searching for a magic formula (and keep renting) or just offer an extra $5k now.

  • ramb9 on 11/08/2023 - 15:46
    +1

    I'd generally value grannys around 150K+ depending on the size and build. Probably costs more to build though now.

    Studio - 100-150
    1BR - 150-200
    2BR - 200+

    Quality plays a big part into grannys from exterior to interior so yeah no fixed value.

  • AustriaBargain on 11/08/2023 - 16:40
    +2

    That looks less like a granny flat and more like a split block.

  • screensaver on 11/08/2023 - 16:57

    this one has storage at rear with toilet and shower 880 sq metres https://www.facebook.com/marketplace/item/240310648823596/?r…

  • Stewardo on 11/08/2023 - 17:33

    Granny flat build cost 2 bed starts at $170-200k
    Granny flats normally devalue the original property when added as it’s no longer as desirable as a family home with garden. But it adds value because of the building that has been added. So the value is similar with or without the granny flat.
    It only makes sense to add a granny flat if you buy an investment property in a low income area with a big block
    And add the granny flat to help cashflow.

  • screensaver on 11/08/2023 - 18:35

    $850000 . 860 square metres, could add granny https://www.facebook.com/marketplace/item/337043148669987/?r…

    • [Deactivated] on 12/08/2023 - 11:21

      Why is there Arabic text in the hidden information section? I've not seen this before.

  • screensaver on 12/08/2023 - 08:56

    heres your price range house plus granny and its been reduced half a millin dollars https://www.facebook.com/marketplace/item/106644219190717/?r…

    • MondaySleeper on 12/08/2023 - 09:18

      Never saw house sale through FB? Are you an agent?

      • brendanm on 12/08/2023 - 11:17

        There are thousands of houses listed for sale on Facebook marketplace.

  • screensaver on 12/08/2023 - 09:26

    no. I think outside the box.You have to go where the others may not go (the buyers), there are more and new ones listed all the time

    • screensaver on 12/08/2023 - 09:27

      also you have to read the description, the granny may not be listed in the title etc

  • Euphemistic on 12/08/2023 - 11:48

    There’s too many variables to say a granny flat adds $xxx.

    A property is worth what someone wants to pay. Granny flat could add $150k for someone who want to house a granny and has some of granny’s funds set aside from the purchase. Might only add $30k for someone who want to make it a gym or art studio but only thinks it as a ‘bonus space’ rather than an income stream.

    Ultimately you as the buyer need to determine what value it adds to you. If someone else thinks it’s worth more, they’ll end up with the contract.

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