Granny Flat #2 - North St Marys

Hi,

So this is the second granny flat I finished on one of my properties.

Cost: $130k total (and I mean everything)
Rental: Aiming for $330/w this close to Christmas, I reckon in a better period, $340/w including water.
ROI: about 13%. Which is far less than my demountable granny flat at 22%.
http://somersoft.com/forums/showthread.php?t=100634&highlight=demountable

I used a builder for this to learn how to manager others as a tool to build interstate. Lots of lessons. Doing it myself I estimate it would have cost $90k-100k.

eg.
1. ensure plans and contract match, builder will use whichever clause benefits him and challenge the other;
2. expect variations of sorts, and i'll be sure to be more specific to the point of having the door knobs and doors specified;
3. expect the job to take longer than expected, builder was amazing then totally slacked off in the last 2 weeks dragging it on for 5 weeks;
4. be very specific in what each clause and deliverable in the contract means, builder and I have very different interpretations on what I thought was obvious.

Many more and i'll write them down as they come. Overall, great experience, great builder, though there were moments when I wanted to punch him in the face, mostly due to my own inexperience.

This one wasn't as interesting as the demountable which had drainage issues, negotiation on easement and structural concerns which needed to be resolved. Overall, pretty straight forward.

Granny flat #3 is starting in 2 months. Plans just given to council. Will keep you posted.
 
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Cost: $130k total (and I mean everything)
Rental: Aiming for $330/w this close to Christmas, I reckon in a better period, $340/w including water.
ROI: about 13%. Which is far less than my demountable granny flat at 22%.

Looks very nice.

The driveway to the granny flat seems to use up quite a bit of land - I imagine this takes a bit away from the main house. Was the main reason for this to give some street front to the granny flat ?

The $330pw rent seems quite ambitous - we get $270pw for our one in North St Marys. It is also new and faces a park.

We review the rents out there and think we are getting the going rate.

Interested to see how you get on with leasing it.

We just got a quote for $220 to separately meter the water and the agents say it is pretty normal for them to read the meters now. Worth doing so you can charge the excess water.
 
Plans for granny flat 3 (starting construction in February)
 

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$330 / week rent incl. water. Would have gone for $340 / week as mentioned previously, it was however the Christmas period and I was worried about taking forever to rent.

Rented within 2 weeks over Christmas, straight after REA opened up again.

House re-valued at $450k (I thought I was being optimistic when I wrote $450k as my personal valuation, should have said higher, next time).

(Kudos to Corey Batt for that one).

Total costs.
Purchase $261k incl. stamp duty, purchase costs etc.
Granny flat and renos $140k.

Total cost $401k.
Total rent $650 / week.

Current Reval. $450k. ($100k of that I would attribute to capital growth since I purchased it in mid 2013). Wish I bought like 5 more, and I could have afforded that at the time.

Definitely better value than getting creative and doing the container shed home. Time and money wise.
 
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the fibro/weatherboard props in a 700m2 in that area are going for low-mid $400k, so think your asking is on the low side..
I would think over $500k in open market is achievable, and a $500k in bank valuation is still achievable.
 
NHG how do you source your sites?

If I was to do another GF project, my present option would be to use a BA (the legendary proportunity). A BA is probably the best choice for my situation but your method may be useful.
 
NHG how do you source your sites?

If I was to do another GF project, my present option would be to use a BA (the legendary proportunity). A BA is probably the best choice for my situation but your method may be useful.

I wish I wasn't so stringent with my purchases. I would actually have a lot more and have made at least $500k more in the same period of time.

Hindsight...

TBH I am a bit of a rogue when it comes to doing my DD the way I should. I do however conduct a lot of ground work and networking with agents, watch each suburb like a hawk.

I didn't live in Sydney when I purchased my properties. I however knew the suburb like the back of my hand, and had people in Sydney do the site inspections for me.

The best methodology I've personally seen is from Margaret Lomas in her book '20 must ask questions for every property investor'. Highly recommend it.
 
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