With the onset of the housing shortage, many homeowners quickly saw the opportunity to earn extra income by renting out their extra rooms. Some, on the other hand, considered building second homes or extensions to their primary residence, but the only problem is that it was not allowed in most areas. That is, until the government decided to relax the laws on grandmother’s flats, allowing them to be built, but only if the owners met certain conditions.

Among the conditions established by the government regarding the construction of these accessory houses, it is included the fact that they can only be built in residential area properties, that each residential property can build a single story, that the block to be build up. Built must not be more than 450 square meters and must not have more than 60 square meters of living space even with the addition of patios and verandas and that cannot exist in strata ownership, subdivision or community title.

Also, they cannot be built on vacant land or on properties that will be used for commercial purposes and that can be attached to the primary residence or be a separate unit on the property. Most importantly, they must have a clear, unobstructed and separate pedestrian access and if you are converting part of your house into a flat, you must ensure that you have a separate entrance.

Given all those rules and regulations, many went ahead and petitioned DA to build their apartments, mainly because current times dictate that multigenerational living arrangements are the norm. Children in debt to students, along with elderly parents in need of help, have no doubt added to the situation, as well as the rising cost of senior care facilities and, of course, the need for the elderly to continue. having a semblance of independence.

To give you an idea of ​​what to expect, real estate experts estimate that you can expect rental returns of around 13% to 20% per year plus growth in equity each year. Renting these apartments also offers you tax depreciation benefits of up to $ 6,000 per year, but the best part is knowing that your investment is not dependent on unpredictable actions, giving you invaluable peace of mind.

For starters, the fact that these secondary homes can increase the home’s resale value and provide a great rental yield are just some of the benefits that can be gained from building home-style apartments on your property. For this strategy to work for you, you will need to consider the physical limitations of your property, the layout and configuration of your home, the area of ​​the lot, and the proximity of neighbors. You may consider spending between $ 10,000 and $ 20,000 to convert your additional rooms into a habitable residence and this includes adding a bathroom that can double your rental rates.

You can also consider a garage or basement conversion, which would be very inexpensive and simply add a window frame opening and possibly a new front door if you are considering a garage conversion, but if a basement conversion is what you are looking for, it would be better. If your home is located on a hill, as the side of the hill can be used to add large windows that allow in natural light and ventilation. As long as your spaces are legally habitable, you’re good to go.

The next thing you can do to make sure this grandma’s apartment strategy works for you is to make sure you have access to a number of tenants who will want to rent it out. You can talk to your local real estate agent to see how much demand these flats are in and how many are looking to rent one or lease one. Drive through the suburbs and check out the types of flooring in your area and find out how you can offer potential tenants better options.

So go ahead and do your research now on the paperwork required to get the ball rolling, check out the demand for these floors, and most importantly the cost of building one. In the right location, these flats can provide fantastic returns so you can see some real income to keep going.