If you are considering growing your passive income, then positive gearing is a great way to go about it. Investing in a granny flat can bring in extra cash on a monthly basis, over and above the sum you would be paying to a lender for the mortgage.
While negative gearing has been a popular investment strategy in Australia in the past, positive gearing offers less risk and can increase your income in the short-term.
Investing in a positively geared investment such as a granny flat offers many additional benefits:
- It can allow you to secure your future
- You are in a more attractive position for lenders
- You can pay off your current mortgage faster
- You can increase your passive income
Consider what you would do if you made an extra $1,000 per month just by renting out a granny flat! And, while the extra cash is undeniably great, a granny flat can also bring tax depreciation benefits and annual capital growth.
Here’s how it works:
Construction Costs: $160,000.00 (ready to move in)
Repayments: $193.00 per week (4.79% Fixed Rate for five years over 30 Years – check here)
Potential Rental Return:
- $430 per week – low end sample here
- $600 per week – mid range sample here
- $950 per week – high range sample here
Assuming worst case rental return, you could be looking at a weekly surplus of $235, this equates to $1,018.00 per month.
The above figures are approximate and based on average current rentals of granny flats in the Sydney area (MARCH 2018). Prices may vary subject to your site conditions, and any council or basix requirements. If this interests you, we will be happy to review your site conditions and send you a quick summary of your site's potential. Click here.
Building a granny flat provides a low-risk venture and a great deal of peace of mind. There is no need to try your hand at the stock market or even invest in a unit or other property which offers a much lower return on your investment.
Our sister company flat grannys, has a range of pre-designed granny flats, let us know if you are interested and we can send across some samples.
If you would like to learn more about investing your money wisely and building a granny flat, then contact us for more information.