Hi Catalyst,

No, not yet. We’ve got good tenants in there now on a 12 month lease so will look at it in a year. From what I’m reading, yea it seems GC Council have a better/faster/easier system under the MCU (‘Material Change of Use’) provisions. On another point the Council rates are not so pretty :)

TheFinanceShop wrote:

Depends on the area.

You will not get a valuation covering construction in say Willmot or Albury but will in say St Leonards or Willoughby.

That’s just not my experience of it, sorry guys. My clients are reporting 100% and more. Perhaps a few years ago but not today.

andy28 wrote:

I have looked into it a bit. The refrigerated ones seem to be the go, as they have good insulation. They cost more though. I could see them being used as granny flats in big back yards of existing rental properties. Or as a hobby off-the-grid project/cubby house/man cave for personal use.

I wonder if some second-hand ones could be gotten cheaply post-mining boom.

There are quite a few resources online about this.

Be careful of getting Council approvals for these types of buildings Andy. Many Councils go by the EP&A Act definition of a building which defines transportable and modular structures as not being buildings; thus they won’t approve them as granny flats. Just make sure you check with Council before hitting the ‘buy-it-now’ button.

Here’s the NSW Planning Circular on the matter: http://www.planning.nsw.gov.au/planningsystem/pdf/circulars/ps06_018_transportablehomes.pdf

I’ve had an application rejected by a Sydney Council and the client already bought the container from eBay! EEEEEEK!

Serge.

blueline wrote:

Brazen are you still involved in GF Permits and construction? Thanks. Blueline.

Hi there Blueline,

Yea I’m still designing, approving and helping with building granny flats for my clients. The unique thing I offer is a ‘co-op’ for investors looking for the best-build-for-the-money. What does this mean?

It means having someone there on the inside looking after your investment goals and interests- an impartial advocate who has no commercial interest in your build. I reject scores of enquirers every week because I can see that a granny flat in their back yard(whilst legal) is going to absolutely destroy the privacy and resale vale of their land. Granted, they often go to a ‘commercial builder’ after I reject them but I’d rather that than an un-occupiable investment on my conscience, no?

On pricing, there are companies offering builds for $80k to $90k BUT they’re shoe-boxes; nothing more than a container or caravan-park cabin on stilts. Then there are companies building decent structures but they’ll sting you with ‘add-ons’ and they’re very top-heavy. These companies charge more just to pay their hefty media bills. You can also spot these businesses by the way they advertise (TV, Radio etc) and they’re lack of transparency on pricing. They boast extravagant advertising and they have sales-staff running all over Sydney offering people the Earth. There’s nothing wrong with advertising of course but for granny flats, which are small developments, there’s not a huge margin for a well-priced builder. Bottom line is this – is your money paying for quality inclusions or for fancy advertising? Something’s gotta give, right? So these larger builders are gambling on the razzle-dazzle of and promises of investment returns etc but we all know this stuff already. We’re property investors!

A little-known fact is that really good builders don’t really need to advertise much at all. I’ll say that again – really good builders don’t need to run TV Ads and hire scores of monkeys to convince people to buy from them. .

The best builders are relatively small operators with just a few staff at most, who just build a granny flat or two at a time. The Builder is physically there on site, not off smiling at cameras.

My own goal (and it gives me great pleasure) is to search out these humble, hard-working builders who are family-run and don’t have unrealistic ambitions. It’s these bigger project companies that lack quality control and rob you of inclusions – to pay for advertising and huge overheads. A business gets to a point where a lot of your money just goes to running their own admin; and they charge you an arm and a leg for the privilege.

I’ve been involved in residential drafting and building approvals for decades and I’ve seen building companies emerge, grow out of control, lose touch with their customers and (whilst the founder gets filthy rich), their quality suffers.

At the end of the day, you’re after the best build for your money are you not? You’re not after a ‘sales experience’. So look for builders who are small, not greedy and who will be there on site day in, day out. When you look at their finished work, look very closely, not with rose-coloured glasses. Look a the joinery work, where the architraves meet. Look at the paint in direct sunlight. Look under the skirtings for gaps and paint runs etc. Look at everything closely and with a critical eye.

I hope this helps!
Serge.

• This reply was modified 10 years, 5 months ago by  Brazen.
• This reply was modified 10 years, 5 months ago by  Brazen.
• This reply was modified 10 years, 5 months ago by  Brazen.
• This reply was modified 10 years, 5 months ago by  Brazen.

Yes it is extremely rare. I’ve done two approvals for granny flats in front yards now (that’s two out of over 600 in 4 years!)
One of them is described here: http://www.grannyflatapprovals.com.au/projects/dee-why

As stated above and to elaborate, the adjoining two dwellings need to be set far forward and your main dwelling (naturally) must be set way back. This will allow room for the granny flat in front of it, too. Pretty rare parameters but it does happen!

The other scenario is where there are no other dwellings within 40 metres of your lot and your main house just happens to have been built far back on the block. Example: Your main house is (say) 12 m from the front boundary- the SEPP allows a setback of 4.5 metres, for a property which is 450 sq m to 900 sq m site area. I’ve only achieved this once which was on a rural lot (Orange NSW).

Brazen

Hi Gemma,

Some Sydney Councils allow granny flats at 65 square meters under their own DCP (Development Control Policy). Even under the current NSW State Legislation, you can attach ancillary structures like sheds, patios, carports, garages and verandas. Have a read of this guide which explains what is allowed: http://www.grannyflatapprovals.com.au/larger-than-60-square-metres

Brazen.

Yea, you can't have a duplex AND a granny flat. A granny flat is a 'secondary dwelling' and the legislation clearly states:

Division 2 Secondary dwellings

19   Definition

In this Division:

development for the purposes of a secondary dwelling includes the following:

(a)  the erection of, or alterations or additions to, a secondary dwelling,

(b)  alterations or additions to a principal dwelling for the purposes of a secondary dwelling.

Note.

The standard instrument defines secondary dwelling as follows:

secondary dwelling means a self-contained dwelling that:

(a) 

is established in conjunction with another dwelling (the principal dwelling), and

(b)  is on the same lot of land (not being an individual lot in a strata plan or community title scheme) as the principal dwelling, and

(c)  is located within, or is attached to, or is separate from, the principal dwelling.

Hi Adam,

It's a really good idea to speak with your accountant about this.

He'll probably advise you to borrow the money for the build because:

1. The interest is tax deductible

2. The valuation will be less than the cash you'll spend.

It's often better (for tax purposes) to let both dwellings out but you will be up for CGT when/if you plan to sell. 

Most of my investors have a 'hold' strategy, where they don't plan to sell in their lifetime. They're going for volume (4- properties+) for a long-term retirement strategy.

Brazen.

Well, secondary dwellings (granny flats) are effectively free for investors:

1. Spend $100,000 to build a quality granny flat

2. Rent tit out for, say, $400 per week

3. Tenants take 6 years to pay it off for you – cost =$0

4. Live off the rental income from front and rear dwellings forever!

5. Rinse and repeat 4-5 times (depending on LVR) and retire on the rental income.

Granny flats allow you to positively gear your investment property BUT BEWARE, it's wise to purchase the right 'granny flat friendly property'.

I've actually written a great guide for new investors looking for suitable properties here: http://www.grannyflatapprovals.com.au/why-granny-flats-are-free 

Brazen.

Yea I do probably 50% of granny flat approvals in the western Sydney region. Next would be south and south western Sydney (Campbelltown etc). I think the prices quoted in the article were quite high? Modular homes are not able to be approved as granny flats under the SEPP, so this article is flawed. Here's the Department of Planning circular on the fact that modular and transportable homes are not dwellings.

http://www.planning.nsw.gov.au/planningsystem/pdf/circulars/ps06_018_transportablehomes.pdf

Brazen.