Market Watch with Gary

Why there is an Increasing Trend in building Granny Flats

Over the last 10 years or so there has been an increasing trend in the building of granny flats in Australia. A granny flat is a second building on a property, often a separate structure but it can also be attached to the main building.

In particular in Western Australia, new residential design codes, which came into effect in August 2013, have had an impact on granny flats in that:

  • the occupants of a granny flat no longer have to be a relative of the main householder;
  • the maximum floor space of a granny flat has increased.

This easing of requirements has been one of the factors in the growing trend of granny flats and has resulted in an increase in enquiries from homeowners looking to build one.

Other factors pushing the trend:

Rising House Prices
It has become increasingly difficult for young couples to save a deposit and purchase their own home. A granny flat is a good start for a young couple who want to set up a life together. It’s a cheap place to rent while they save for a deposit for a house of their own without the stress of living in the same dwelling as the in-laws.

Investment Returns
Investors are increasingly looking for higher returns and a granny flat is not only cheaper to build compared to buying another property but can also be built very quickly, typically between 8-12 weeks.

Increased life expectancy
Over the last century life expectancy has increased dramatically; a boy or girl born in 1901-1910 had a life expectancy of 55.2 years and 58.8 years respectively. Today in Australia men are expected to live 80.5 years on average and women 84.6 years on average. There are now many more people who may need a little extra help but don’t want to be put in a home. Being able to house them in a granny flat helps them to maintain their independence.

Increase in people working from home
In May 2013 the Australian Communications and Media Authority found that 5.6 million adults were using the internet for work either outside office hours or actually working from home. Better and faster internet connections will see more people working from home in the future. Granny flats have been of great advantage to those working from home with the added advantages of saving on office rental, commuting expenses and travel time.

Perth Annual Real Estate and Business Marketing Event

I went to this event this week with Peter from Direct Move (He’s one of the best Perth for sale by owner real estate agents; if you haven’t already met him).

We had a ball at the event and managed to network with many other professionals in many markets; from Insurance Broking, Real Estate, Sales, Commercial Lawyers and many others.

aib-real-estate-conference

Perth Property Market Watch

The Perth real estate and property market has been a great performer for the last 10 years but what does the future hold?

Market forecast – what’s in store for Perth real estate?

 

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