Granny flats are more affordable than buying or leasing a separate property, so it’s a win-win situation for smart owners and tenants of real estate rentals in Sydney and elsewhere in Australia. To provide more affordable housing facilities to people, the NSW government is encouraging landlords to build and rent out granny flats. In this article, we will share the regulations to consider before renting out a granny flat in NSW.
Who Can Rent Out a Granny Flat?
If you’re trying to find a house with a granny flat to rent, you’re in luck! Anyone can rent out a granny flat in NSW as long as they follow the local legislation. As per the Affordable Rental Housing State Environmental Planning Policy, homeowners can build a granny flat or a secondary dwelling on their home and rent these dwellings to tenants, but they cannot rent out a granny flat to a family member.
Granny flat designs are first approved by a certified accreditor before their construction, as mandated by Fair Trading NSW. If the constructed building doesn’t meet the standard, the landlords can face heavy financial penalties. Of course, it’s better to pay these penalties than deal with a tenant injured due to non-compliance in the design and construction. So, it’s important to know all about the local legislation of your council before constructing and renting out a secondary dwelling.
The Approval Process of a Granny Flat
Follow the given steps to build and rent out a granny flat:
- Get approval for all the work. To begin, you can lodge a Development Application for your primary and secondary dwellings. Your local council will approve this application or you can get a Complying Development Certificate from a private certifier.
- After the approval, build your granny flat.
- Get the Occupation Certificate (OC) for your granny flat. This certificate ensures the authorisation of the occupation and allows you to use the new building or a section of it. To get the OC, ensure there’s no incomplete construction that can cause health or safety issues to residents.
- Construct the main house if you have not already.
- Get the final Occupation Certificate for all construction within five years of the first OC. The first OC is issued for the partially completed development of the building on the condition that you get the final OC for the complete development of both the primary and secondary dwelling within five years of the issue of the initial occupation certificate.
Where Can I Build Secondary Dwellings?
Secondary dwellings can be built in residential zones, including R1, R2, R3, R4, and R5. Under the Local Environment Plan of a council, you may also be permitted to build secondary dwellings in other zones; there are many additional requirements and standards that secondary dwellings need to comply with as per the Affordable Rental Housing State Environmental Planning Policy.
A Few Additional Tips
To get the most out of your rental granny flat, you should follow these tips after getting the approval of your local council:
1. Talk to Your Local Real Estate Agent
You must win local council approval to build secondary dwellings and rent them out. After that, talk to a local real estate agent about the demand for granny flat rentals in your area. Ask about the rental market trends in your area, including the average weekly rent, what type of tenants are looking for a granny flat in your area, and what features and facilities these tenants are looking for.
2. Consider Tenant Requirements
Tenants have tons of options for renting today—they can share houses or live in studios or condos. Apartments and granny flats can be similar in size, so it can be necessary to enhance the appeal of your granny flat by making a few significant changes. To stand out from apartments in your area, figure out what your dream tenants are looking for and try incorporating those features. If you’re considering other cities in Australia for property investments, make sure you learn the requirements to rent out property in Sydney.
If you’re apartment hunting in Australia, we have just the thing for you—install the Soho app now or check out our website to get listings based on your preferences, whether it’s a granny flat in NSW or renting a home in Melbourne from the owner.
