Granny Flats have increased by 24.1% in Western Sydney by Anna Mendonca- Marrickivlle Real Estate

A gold mine in your own backyard

Increasing property and rental prices have forced many Australians to start looking for alternative living arrangements. This has caused a surge in demand for secondary dwellings or granny flats.

In response to this demand, data collected from thousands of BMT Tax Depreciation Schedules suggests construction of granny flats has increased by 24.1% in Western Sydney suburbs and 9.3% across Australia over the last two financial years. This dramatic increase in construction can be attributed to state-level legislative changes regarding secondary dwellings, aiming to boost housing affordability in capital city areas.

2009 saw the Affordable Rental Housing – State Environmental Planning Policy (SEPP) come into force in NSW. In August 2013, WA followed suit with its State Planning Policy 3.1 Residential Design Codes. With these legislative changes, NSW and WA join the NT, ACT and TAS in allowing property owners to rent a secondary dwelling to those other than family members or friends.

While renters are often attracted to granny flats for their affordability, many property investors are keen to capitalise on this recent demand for secondary dwellings due to the high rental yields often achieved.

Our data suggests that on average a granny flat will cost $121,000 to construct. Property owners have found that they are usually able to achieve annual rental yields of 15% on this investment.

In order to maximise the benefit of this yield, all granny flat owners should understand their depreciation entitlements.

When a secondary dwelling is income-producing the owner is entitled to substantial deductions, even if they are currently occupying the primary residence on the property. Research conducted by BMT has shown that the average first year depreciation deduction for a granny flat is $5,288, accumulating to $23,713 in deductions over the first five years. Shared areas between the granny flat and owner-occupied property such as patios, pools and barbecues may also entitle the owner to additional depreciation deductions, claimed based on the tenant’s usage percentage.

To understand the viability of using a secondary dwelling as an additional source of income on a particular property, the table below illustrates the differences in regulations between states as well as the first-year depreciation deductions a property investor would be able to claim.

Assumptions and Disclaimer

When evaluating the cash flow potential of a secondary dwelling on your property, we can provide an estimate of the tax depreciation deductions that would become available. Complete this form today and one of our depreciation experts will be in contact.

Sell your property today with Anna Mendonca! 

Anna Mendonca 0433 56 99 33
www.marrickville-realestate.com.au

2% cash rate cut again - Anna Mendonca - Marrickville Real Estate

 2% cash rate cut  to record low by RBA

The Reserve Bank of Australia is widely tipped to cut interest rates for the second time this year when its board meets on Tuesday, despite signs the economy is improving and it happened.

www.marrickville-realestate.com.au

Marrickville Sunrise

Glorious morning in Sydney..perfect sunrise..
Www.marrickville-realestate.com.au

Sydney's Inner West Suburb - Profile "Marrickville"

One of Sydney’s inner-west best renown Suburbs "Marrickville"

 

Marrickville residents enjoy three train stations including the junction that is Sydenham. If that weren’t enough, Marrickville also boasts multiple bus services that serve every main road in the suburb. With just 5km between Marrickville and Sydney Airport, it’s clear this suburb has transport covered.

You’d also be hard pressed to think of something you need that can’t be bought here. There are two Woolworths supermarkets and an Aldi to shop for essentials, as well as countless butchers, bakers and grocery stores. Specialty stores may actually be Marrickville’s specialty because they’re here in volumes. Of course, it would be remiss not to mention the Marrickville Organic Food and Farmers’ Markets – held every Sunday at the Addison Community Centre. When locals look to eat out they have many excellent options with Japanese, Vietnamese, Greek, Italian, Spanish, Modern Australian and so many more to select from. Worth noting however is that this suburb is in the flight path for Sydney Airport, which does have a curfew, but planes can sometimes interrupt conversations.

Subdivision of the area now known as Marrickville began in 1855 and happily there are still buildings in the area from this era. Easy-care apartment buildings are plentiful, but if it’s history you’re looking for you’re more likely to find it in one of the many freestanding or terrace style houses.

 Miners’ cottages, post-war, Federation – they can all be found in Marrickville.

No matter your age, what language you speak or your life stage, you’re not just welcome but well catered for in Marrickville. In this suburb, homes are varied, shopping is prolific, infrastructure is ideal and schools are abundant. Together with excellent recreational and entertainment options this suburb belongs on every house-hunter’s list.

www.marrickville-realestate.com.au