Granny flats have seen a surge in popularity recently. But do they add value? Belle Property Licensed Real Estate Agent Jo Morrison says yes – but only if done correctly.
“The demand for granny flats really depends on the location,” says Morrison. “They tend to be popular in places like Sydney’s Northern Beaches for a few reasons. Firstly, property values are high, so it can be difficult for buyers to get on the property ladder. A granny flat means you can split the mortgage with family or friends or rent out the additional space to support your existing mortgage. It’s also quite common in more affluent areas for people to use a granny flat as accommodation for a nanny or an au pair.”
Things to consider
If possible, Morrison recommends designing the area to be totally separate from the main house. “That’s how you’re going to add the most value. However, not all buyers will want a granny flat, so ideally it should be able to be turned back into part of the main home if necessary.”
It’s also important to ensure the unit has full council approvals, “Approvals must be noted in the contract for sale and not having the right ones will put buyers off. If the structure is not approved, you won’t be able to have it managed as a rental property from a real estate agency.”
In Morrison’s experience, granny flats do add value. However, if you’re thinking about building one, there are some suggestions she would make before going ahead.
“If it’s possible to provide a separate entrance then do so, and make sure the area is well lit. Parking is always an attractive feature, as is a separate outdoor area with privacy from the main dwelling. Finally, have the property separately metered. This gives the unit added independence from the main house.”