Hi Everyone, excited to write my first post (new to the game!) My new hobby/obsession :)
As mentioned I bought my first property in NSW. Its a 3bedroom House. Outside there’s a large granny flat with its own kitchen and bathroom that i also want to rent out as 2 rentals in one property. It has not been sub-metered for the electricity or gas (will do this before the lease is up). It is on one title. Its currently rented as a whole with a lease expiring in march. The current tenants have friends that want to move in to the granny flat. However don’t want that to happen till March as they want everything to be separate (separate lease and electricity and gas) which i’m happy enough to wait for. (even thought when sold the property they told me otherwise)
I have a couple of questions i’m hoping you can help me with!
The real estate i bought off who currently are the property managers say they are not prepared to take on the property if i choose to rent out the granny flat as well. Is this a common problem? Will i have problems letting this out as its not subdivided (once I’ve separated the gas and electricity)
The current real estate suggested I property manage the place myself if i wanted to sublease the property straight away (still not sure if its not legal for them to do why its legal for me to do?). Anyway, being new to this and about 5hr drive away im not sure this is the right move.I rang another property manager quickly in regards to it who also said about subdivision. When i said in NSW the granny flat doesn’t have to be subdivided to rent out she agreed but said the water and electricity definitely does. (Shes not going to backtrack on this too is she?) Is my problems because I’m renting BOTH the house and granny flat. Has anyone else done this??
Also with the Granny flats , once i have separated the water and electricity the granny flat owner still doesn’t have a mailbox? How do they get their electricity bills?
Any help would be most appreciated! Am i missing something here????
Cheers
Samantha
Hi,
Is the granny flat approved?If not be VERY careful. Insurance will not cover it and if there is an accident you may lose everything you own (and then some).
Ok so I’ll assume it is legal.
You cannot rent separately if the power and water are not separate. If it is together most people just rent as a whole then the tenants sublease the granny flat. Of course this is the easiest option but the rent will not be as high.
Is there privacy between the house and the granny flat? If not then this also causes problems (maybe why agents aren’t interested?).
Just get a second letter box and label them house number A and B. eg 5A, 5B. Tell tenants to direct their mail to 5A or 5B. Not sure if you need council approval. Just do it and see. You also need to think about garbage bins. If you need to get a set for the granny flat you are looking at about $300 a year for a second set (depends on your council). When you get the new subboard for the electricity just put the A or B address on it.
Have you looked at the cost of getting the new subboard and separate water meter? You might find the cost prohibitive. If the granny flat is not approved this may Also raise red flags with council. Then council may ask you to take the kitchen out (so it’s no longer rentable).good luck.
Thanks for your reply. i most appreciate the advice.
Yes i had this checked over by my conveyancor. it was approved as a games room (with kitchen and bathroom)back in the 80/90’s my conveyancor had no problems with that.
I have also clarified with my insurance the building insurance is covered as one whole and landlord insurance would be needed per lease so will have 2 landlord policies once the granny flat is rented out separately.
Sorry i might of been confusing before i meant that the electricity and gas will be separated. I will pay for the cost of water.Theres not too much privacy at the moment (something i will have to look into) but as the current tenants have friends who want to move in it wont be an issue for them. (so can wait on this) It is definitely separated from the house and you cant see into each others property’s or anything like that.
I have heard about this mailbox idea and what worry’s me is council. I think they would kick up a stink saying i cant do it as its not subdivided. I heard this happened to someone not sure if it was a forum on this site or elsewhere. I know theres a lot of granny flat owners in Sydney – what do you guys do? Scared to contact council as they were very unhelpful on my first enquiries, and know that NSW Granny flat rules and Council rules can be conflicting, but was told as long as your meeting NSW rules your fine to rent it out.
Ok so it’s approved as a games room. So it is NOT approved as a grannyflat, ie as habitable dwelling. Be careful then when dealing with council. If they are friends could they not share a letterbox (and bins?)?
I’m surprised your insurance company will insure it as one dwelling when it is rented as 2 dwellings.
I could not find any that would do it and mine is actually one house that I split. Who was that with?
Hi There,
Terri Scheer. Also a good price too! Yeahp i had a good conversation with them. They cover the place on a whole (building insurance comparable to other building only insurance) and then 2 seperate landlord policies for roughly $300 each.
There was also CGU but i thought terri scheer offered better value.
The only other place i could find was NRMA but they wanted to charge 2 lots of Landlord (both the combined building and landlord) which of course comes up more because its not separated.
Hope i helped you out!Its really impossible to find info on this granny flat stuff on whats needed to do for an existing granny flat. Legally do i need to ask council for approval for habitable dwelling? Its been approved as a games room with the kitchen and bathroom. I’m going to separate the electricty and gas and install the smoke alarm. I believe that should meet the NSW Granny flat requirements. Maybe ill call NSW granny flat dept see what they say first.
Did you tell council of your split house? Do you rent through a property manager or by yourself?
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