Dual occupancy homes do not typically have the option of strata, and will remain on a single title. As an owner however, you might choose to reside in one yourself and rent out the other, or rent both properties out either together or separately. Although both residences will be self-contained with their own individual entrances, some people may add in an internal door for access if family is residing in the adjoining residence.
For many people the rental income from one property while you reside in the other or income from both rented out simultaneously, will seriously offset the cost of your mortgage. After all, two residences with two bedrooms will be rented for more overall than a 4-bedroom house on the same block size. For this reason, if you already live in an established house you might consider building a granny flat to allow for an additional revenue stream. Of course, with renovation, you could also take an existing home and make it dual occupancy under the same roof line.
As an investor, a dual occupancy home also presents less risk to you in the eyes of the bank. This is because your ability to service your loan is more stable, even if one home is untenanted for a short period of time. In some instances, you might even be able to generate positive cash flow from having two residences rented out.
Unless it’s a new build, such as part of a house and land package, use caution if you are looking to buy an existing dual occupancy residence. Although in theory most of them are council compliant, it is worth double checking that they have not been illegally converted at some stage. To determine this, it’s best to get a look at the house plans and determining if extra additions have been made over the years and whether permission was obtained to do so. Older homes may have additions that were potentially okay at the time, but now fall short of building standards. As a potential buyer, you would hate to be stuck with the extra cost of restoring a home back to its original form and potentially losing what attracted you to the property in the first place, such as dual-living zones.
If you’re looking to build new, you might be surprised to know that land size does not need to be exceptional in order to house a dual occupancy residence. Subject to the local council approval, you may find some areas do not have a minimum lot size requirement, while others may. Therefore, if you’re looking to invest as a type of DIY project, make sure you know the requirements in each area that you are looking to save time. Once you have a site in mind, you might choose to select a builder with experience in dual occupancy to help the build run more smoothly and they should have a pre-existing network of other relevant people like drafters that can assist with the design.… Read More