This relates to the division of one single residence.
What's the difference between strata titling a 5br house into 2x2br + 1x1br flats? (can you do that?)
Converting 2br into a sparate granny flat under SEPP AH?
Or leasing all 5 rooms separately?I'm interested more in the legal/insurance aspects.
We nearly bought a 2 story place late last year but it turned out retrofitting fire rated load bearing walls and ceiling/floor separation (as advised by council) was going to cost too much. The intention was to rent both as separate flats. I'm thinking maybe now we could have got away with leasing rooms out separately or something like that?
Cheers
Hi Grantos,
Strata Title-ing (as you call it) involves sub-dividing the property into separate lots and creating 'common property', which is areas like the driveway etc. Your Council may or may not allow this on your lot, depending on the zoning and the dimensions of your block itself- the width usually being the critical dimension.
The costs associated with this type of property investment are quite substantial, with associated levies, development and legal fees.
Comparatively, converting part of the main dwelling (or even extending it) into a granny flat (termed a 'secondary dwelling'), is relatively cheap. This is because theres no subdivision and minimal legal fees. In reality, the only costs are the Council (or Private certifier's) approval fees, the physical costs of providing a Fire-rated-Wall and of course the renovation work needed within the building itself.
Leasing rooms individually means creating a 'Boarding House'. This can also be done under the SEPP in many cases. There are some prescriptive requirements under the SEPP which must also be met. The Building Code of Australia also requires that certain fire-safety and access/egress measures are implemented into the boarding house.
The legal and insurance costs are much more when subdividing because you are splitting the property into individual lots with the associated surveying (linen plans etc) fees, conveyance fees, section 94 contributions and other Council fees. So, the paperwork is quite expensive when subdiving as compared to just creating a secondary dwelling. I'd expect fees upwards of $10,000 for subdividing a residential block into, say, a battle-axe arrangement with a common driveway.
A secondary dwelling (granny flat) is NOT a legal subdivision and it actually locks the property out of subdivision whilst the granny flat is there. To annul this, you'd have to legally decommission the granny flat and then subdivide.
On the question of fire-rated walls, the cost will depend on the roof-form (usually), with simple gable-end roofs being easier to retrofit with fire-proof walls, compared to a hip-roof for example. A skillion (or flat-roof) extension may also be a much cheaper way to provide an attached granny flat as well. There's a description and comparative analysis of 'attached granny flats here: http://www.grannyflatapprovals.com.au/news/attached-vs-detached-granny-flats/
I hope this helps.
Brazen
Brazen | Granny Flat Approvals Sydney
http://www.grannyflatapprovals.com.au
Email Me | Phone MeGranny Flat Approvals Guru
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