Colin Fragar, our founder and CEO, shares some of the lessons we’ve learned at the Council Approval Group about making the most of what dual occupancy development has to offer.
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So how does dual occupancy work for savvy investors?
My name is Colin Fragar from the Council Approval Group.
Today, I really want to share some of the wisdom that we’ve learned from doing thousands of these, either for ourselves or for clients, and to bring some of these best ideas forward to you.
It’s All About the NumbersSo it’s all about the numbers really with the dual occupancy investment. A dual occupancy has the advantage over a granny flat in that you can have a larger floor area. So you are usually looking for a three-bedroom dual occupancy rather than a two-bedroom granny flat, so that boosts cash flow.
Please have a look at whether you can do a dual occupancy subdivision. Imagine if you could sell off half of your land for $500,000, $700,000, whatever it’s worth, a million dollars. Imagine if you could sell that off and reduce your debt levels. What would that do to your financial security and the amount of money that you would be bringing in every single month from your investment?
Forget about 4% or 5% returns, you are looking at double-digit returns at least. Sometimes, I’ve seen these in 100% return scenarios when you’ve been able to reduce your mortgage significantly.Another strategy I see investors use is depreciation. Think about the new builds. If you’ve got an old dwelling and you’re building a new one, think about which one you sell. Which one will maximise your depreciation benefits? I’ll let you answer that question.
Perhaps, there is a way for you to retain the existing dwelling. Please don’t just bring in the bulldozer. I see so many mistakes being made by investors where they’ve got a lot of land and they think “I can get a Dual Occupancy on this”. So, they bring in the bulldozer and they wipe literally $300,000 to $400,000 off their financial return.
So if you can retain. Do a little bit of modification, remove a garage or an extension or something like that to create the space if you need to. But where possible, please keep that existing dwelling.
Let Us Help Make Dual Occupancy Development Work For YouHope you found these tips useful. If you are serious about your property investment portfolio and your financial future and you do have a site that you would like to talk about, please do a couple of things. First of all, grab Your Ultimate Guide In Achieving Council Approval with more tips in here. The second one is to book in for a consultation with one of our team at the Council Approval Group.
My name is Colin Fragar and I wish you all the best.