Why Are Granny Flats So Popular?

Posted on February 4th, 2025

We are often asked the question, ‘is it worth adding a granny flat to my land?’, so we thought we would share with you all why it is worth building a granny flat…

Affordable

Building a granny flat is often budget friendly. It offers a more affordable option to help your children get a start in their own small home, without stamp duty. With a legal agreement in place, they could even invest on your land and you can buy them out later and turn your granny flat into an income stream through airbnb.

Investment

It’s a great way to gain an investment rental income without the stamp duty or land tax of owning an additional investment property. You may need to pay capital gains.

Depreciation Benefits

Most states now allow you to rent out you granny flat investment with the same tax benefits as an investment property. You can claim depreciation on many of the assets and the capital works involved in the flat build can be claimed as depreciation. Savvy business people can lower their annual tax bills.

Guest Accommodation

If you have friends or relatives from your overseas roots (expat) they have a lovely self-contained and often private place to stay when they visit, allowing extended visits with a healthy amount of space. Then you can list on grannyflatrental.com.au between visits for short term stays.

Increase the Value of your Property

CoreLogic stated in 2023, “for a house worth $500,000, the addition of a granny flat has the potential to add approximately $160,000 to the value of the property.”

Privacy

These properties are often more private than those of a similar size and price, so are attractive to many prospect tenants, and leased out quickly.

Pet Friendly

Over 65% of renters have a pet. Granny flats can often accommodate pets due to a small courtyard or garden fully fenced and pet friendly floor coverings. It’s also great as an airbnb or through our pet friendly site for those holidayers who only travel to homes not hotels so they can bring fido. A growing popular way to travel.

Work from Home

A two bedroom granny flat often allows for a couple to have a nice, small, independent home with a separate room for an office. With most organisations allowing flexible hybrid working situations between remote and in-person, this is a perfect solution.

Design Your Dream Home

Often, bigger homes end up with clutter from busy families. We know many of our granny flat members love designing the perfect little property. A compact, well-kept and separate granny flat allows secretly sneaking in a bit of quiet time to meditate, do yoga or just read a magazine between guests.

Artist Retreat

A granny flat provides the perfect studio to create or write in a garden setting. The privacy and security of a secondary dwellings allows creative flow without interruption, important for productivity and reward of creating.

So are you going to consider adding your home to the granny flat boom? If so fill out our granny flat builder form and we can refer you to a five star granny flat builder in your area….

Read’s you may be interested in:

How to make your granny flat the fool proof investment

Building a Granny Flat: What Makes it Attractive to Tenants

How to Add Luxury to Your Granny Flat to Justify High Rent Rates

What is Agritourism and who can make the most of it with Granny flats and Tiny Houses

Building a granny flat? Be aware of the Hidden Costs