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DUAL OCCUPANCY
What is dual occupancy?
A dual-occupancy house is a residential property specifically designed and constructed to accommodate two separate dwellings on a single parcel of land. These two dwellings are attached with a firewall separation in the middle and can never be strata titled as opposed to a duplex property.
The configuration of a dual occupancy property is typically the same with a main dwelling comprising of 2-3 bedrooms and a secondary dwelling comprising of 1-2 bedrooms. Each dwelling has its own entrance, garage and outdoor areas.
There are several flexible uses for this type of property which is beneficial to capital growth however if you build your property too small <200m2 it may be viewed by many to be too small for an owner occupier dwelling.
Investment Property: One or both dwellings can be rented out to generate rental income. This means you can live in one dwelling and rent out the secondary dwelling to help pay down your mortgage. This is an ideal investment strategy for first home buyers who can effectively have a principal place of residence and an investment property at the same time.
Multigenerational Living: Dual-occupancy houses are popular for accommodating extended families, such as providing independent living spaces for elderly parents or teen/adult children.
Home Office or Guest Accommodation: One dwelling might be used as a home office or guest house, providing flexibility in how the property is utilised.
Dual occupancy houses have restrictions on where you can build them depending on their use. For example, you cannot build them throughout Victoria for use as an investment property. These properties are subject to local planning and zoning regulations, which govern aspects such as minimum lot size, setbacks, and parking requirements. Local regulations are sometimes covered under granny flat legislation such as in NSW and Victoria.
Why Invest a dual occupancy?
Investing in a dual occupancy has many advantages over traditional house including:
High Demand: Rising property prices, particularly in major cities like Sydney, Melbourne, and Brisbane, have made it difficult for younger generations to afford their own homes. As a result, more young adults are staying longer with their parents or moving back in after a period of independence. Additionally, Australia’s aging population has led to an increased need for elder care. Many families opt for intergenerational living to provide care and support for aging parents or grandparents within the home, rather than relying on external aged care facilities.
Affordability: With the ability to rent out the secondary dwelling as an investment property, an owner occupier can have higher serviceability when applying for a loan than they would have with a traditional house.
Flexibility: These properties can be utilised as an investment property, an owner occupier dwelling or both at the same time making it ideal for investors, intergenerational families and first home buyers.
Attractive Returns: A dual occupancy house provides a higher gross yield than a traditional house with the owner receiving up to two rental incomes without the additional cost of having to strata title the property like a duplex.
Why use The Property Room?
We have built over 200 dual occupancy houses for our clients in various regions including southwest Sydney, Newcastle, Moreton Bay and southeast QLD.
Area Research: With our extensive experience of building many dual occupancy houses we have a good understanding of which areas provide the best capital growth combined with strong cashflow.
Local Government Regulations: We are very familiar with where you can build a dual occupancy and finding land in these areas.a
Configuration: We understand the configurations that work best for investors and owner occupiers to maximise rental returns and capital growth.
