Have you been entertaining the idea of building a granny flat in the back yard, to help with the current housing crisis – and possibly bring in some welcome income?
A new report released this week by Corelogic has revealed that more than half a million homes in Australia’s three biggest cities could house granny flats.
Based on analysis by Archistar, Blackfort and CoreLogic, granny flats have the ability to quickly and affordably address some of the current housing crisis. More than 655,000 residential properties suitable for a granny flat have been identified across Sydney, Melbourne and Brisbane.
Sydney is home to the most granny flat development opportunities with around 242,000 suitable properties, representing 17.6% of the metro region’s housing stock. Melbourne has almost 230,000 potential sites, representing 13.2% of stock, while Brisbane has almost 185,000 suitable sites, representing 23.3% of houses across the metro region.
Of these sites, more than a third (36%) are within two kilometres of a train or light rail station and 17% have a hospital within the suburb boundary, demonstrating a combination of accessibility and opportunity to fast-track housing options for essential workers in the health care sector.
CoreLogic Research Director Tim Lawless said the results highlight significant untapped development potential which could go some way toward fast tracking a partial remedy to the housing shortage in the country’s largest cities.
“NHIFC forecasts indicate the national housing market is likely to be undersupplied to the tune of 106,300 dwellings over the next five years”, Lawless said.
“For policy makers and government, granny flats present an immediate and cost-effective opportunity to deliver much needed housing supply within existing town planning guidelines. For homeowners, the addition of a second self-contained dwelling provides an opportunity to provide rental housing or additional accommodation for family members, while at the same time, increasing the value of their property and potentially attaining additional rental income.”
Archistar co-founder Dr Benjamin Coorey said accommodating the growing population within these larger capitals is a critical issue that flexible housing solutions can help address.
“Since granny flat developments leverage existing lot areas and require no changes to town planning regulation, they offer an immediate opportunity to address housing shortages and affordability pressures expected in the coming five years for both buyers and renters.”
Lawless added that there are immediate lifestyle and financial upsides for investors whose properties met the planning requirements.
“Adding a granny flat accommodates extra living space for extended family, multi-generational households or rental purposes, thereby boosting a property’s value and potentially creating extra income for rising living costs”, he said.
“CoreLogic figures show an extra two bedrooms, and an additional bathroom could add around 32% to the value of an existing dwelling. For a house worth $500,000, the addition of a granny flat has the potential to add approximately $160,000 to the value of the property.”
Dr Coorey said the research showed more than a third of the sites identified are close to existing amenities and services such as transport or a hospital.
“Granny flats present a cost-effective opportunity to boost housing supply for growing capital populations close to existing infrastructure such as railways, bus routes and major road networks for state and local governments.
“While building regulations for secondary dwellings differ state to state, this unlocks a combination of accessibility and opportunity to fast track affordable housing options for all demographics, particularly essential workers in industries such as the health care sector”, he concluded.
