What goes up much come down… Or does it? With housing affordability at an all-time low in Australia you’ve just got to wonder – will prices ever go down? At the moment the only housing market that’s seen a considerable downturn at the moment is in WA, where the end of the mining boom has seen house prices fall considerably. Prices on the East Coast are still feeling the heat.
This has had many trickle down effects for the property market. One of these has been a surge in granny flats designs. Often granny flats are installed in a home’s backyard to help ease the strain of a very high rental market. Granny flats are popular among those extending their families, where older children are staying at home longer because they can’t afford to buy, or even rent in some places, where older relatives can’t afford to live in their own homes any longer, and where people are interested in providing short term or long term accommodation to people renting or on holidays to help pay for the mortgage repayments.
Granny flats make sense fiscally in a market where we see no end to the strain. While market economists predict a housing market crash, we don’t know when or even if this will eventuate.
Other solutions that people are going for include potential first home buyers renting instead of purchasing their own homes, a lot more small apartments coming on the market that are more affordable as an owned home choice, moving to more affordable cities such as Adelaide, or even the country, and some people going and living the expat life overseas where prices are lowered.
Even those who earn a good salary can be pushed out of the housing market in these times, particularly if inner city living is a must regarding commute times. It’s scary to think that the cost of renting a one bedroom apartment in the centre of the city in Sydney is over 60% more than the cost of the same rental in Paris!
As far as solutions go for housing unaffordability, a granny flat provides a good stop gap. It’s something that you can control – it’s yours, it may be considerably cheaper than adding an extension to your existing home, and it can provide a very private space for whoever is going to be staying in it. These are all very compelling reasons as to why it’s a good idea.
So, if you’re thinking that your house is getting too small to home everywhere and you have a big enough yard it’s a great option instead of buying somewhere else. If you’re looking for a little bit of extra income to ease the stress on your mortgage and you live in a reasonable location, it’s great to install either long term or short term renters in there.
A great tip is to build your granny flat so that it can be a fully contained space. Even if you have teenagers that you’d like to put in there, it makes sense to have a bathroom and kitchen attached to the granny flat for the least disruption to the household. Even if your kids eat meals inside, there may be times when they want to whip up a quick snap late at night without going into the house. Plus if you add amenities to your granny flat it’ll add more value at the time when you do look at selling your own home, or once the kids move out, you can charge a higher price to rent it out.
Read More: Demand rising for Aussie granny flats