Yahoo Finance Bad news for parents: Sydney property too expensive, granny flat trend booms
With eye-watering property prices, it’s no surprise New South Wales has been revealed as Australia’s granny flat capital.
Housing Industry Association data revealed there were a whopping 6,065 granny flats built in NSW last year, which is almost triple the amount built in runner-up state, Queensland.
South Australia was next on the list with 910 built, while 638 were built in Western Australia, and just 166 were built in Victoria.
Why are so many granny flats being built in NSW?
Domain’s economist, Trent Wiltshire, told Yahoo Finance that a combination of unaffordable housing in NSW and lenient development laws in the state have led to a rise in granny flats.
“The high cost of land in Sydney makes granny flats more attractive,” Wiltshire said. “Vacant or large backyards are worth a lot.”
Granny flats alleviate the pressure off younger families, but also suit Australia’s ageing population.
“It’s a sign of changing cultural habits,” Wiltshire said. “We know people are studying for longer and wanting to live at home for longer, but looking at the ageing population, it’s a good way to house older parents.”
While granny flats are primarily built for family members, they’re not a bad way to make a little extra cash on the side either.
“Most people would use it as a family member’s dwelling, but some people might choose to Airbnb it.”
CoreLogic said that leasing a granny flat could meet the demand for affordable housing by offering a long-term rental.
“Leasing a granny flat could be a popular alternative to leasing a typical unit because the rent tends to be less expensive,” they said. “Leasing a granny flat could be a popular alternative to leasing a typical unit because the rent tends to be less expensive.”
Are they still on the rise?
Wiltshire said the boom in granny flats coincided with the 2012-17 Sydney price boom.
So, while it could mean that a downturn in property prices will see a downturn in granny flats being built, if prices turn around again, we might equally see them continue to be built.
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