We’re getting a lot of inquiries on how to build a dual occupancy property the right way. Specifically on Queensland and the Logan Council Area South of Brisbane and the Ipswich Council Area West of Brisbane.
What is Dual Occupancy?
A Dual Occupancy or Dual Occupancy Auxiliary Property, depending on which area you are in, is a type of property that has two homes on one title. There is the primary side and a smaller Auxiliary side. Our Youtube video above gives prospect investors the basic information they need.
Dual Occupancy Homes Brisbane
Dual Occupancy Homes Brisbane is a common question that we are asked here at New Property Australia. Brisbane doesn’t currently have a dual occupancy auxiliary policy to allow you to build these in the Brisbane City Council Area. However, three areas that are adjoining the Brisbane City Council do. So chances are, you won’t find a large number of dual occupancy homes for sale in Brisbane.
These areas are:
- Logan City Council to the South of Brisbane
- Ipswich City Council to the West of Brisbane
- Moreton Bay Region Council to the North of Brisbane (this is currently under consideration at the time of writing this article)
There are different products available in other States, but this article will focus on Queensland, specifically the Logan Council Area South of Brisbane and the Ipswich Council Area West of Brisbane.
The definition of a dual occupancy property is where there are two properties on one title which can’t be strata-titled and have a restriction on the size and number of bedrooms allowed in the second dwelling.
Dual Occupancy houses are different from a Duplex, which allows for strata titling and doesn’t have strict rules regarding the second dwelling size and the number of bedrooms.
Dual Occupancy Builders Brisbane
As mentioned above, Dual Occupancy Builders Brisbane has very few options for dual occupancy auxiliary properties in the Brisbane City Council Area. Until the Brisbane City Council released a new policy to allow this type of dwelling, it is unlikely you’ll be able to find Brisbane, dual occupancy builders. However, we work with some very experienced Dual Occupancy Builders Brisbane, who build in Logan, Ipswich and Moreton Bay Council Areas.
1.There Are Different Definitions and rules across Different Council Areas.
In Queensland, the dual occupancy policies are governed by each local Council. As such, there are different rules which need to be considered in each Council area. In some states in Australia, there are state-based rules which govern the whole state, but for Queensland, each Council area varies.
As we are mainly focussed on the South East QLD region, I’m going to discuss a couple of the areas in which we have had numerous successful builds undertaken for our clients. The difference across the following two areas is an excellent example of the differences across different Council areas.
Logan City Council:
The definition under the Logan City Council is a premise that contains two dwellings on one lot (whether or not attached) for separate households, both dwellings are owned by the same person and must conform to the following rules:
- Two bedrooms maximum
- One kitchen maximum
- One Living space maximum
- Only one vehicle driveway
- Maximum size of 70m2 for residential zoning on lots less than 1000m2; or 100m2 otherwise.
We produce the designs for our dual occupancy properties in the Logan City Council area for residential blocks of land less than 1000m2 and have auxiliary dwellings with a maximum of 70m2 of living area. They also have two bedrooms, one kitchen and one living room and only one driveway crossover.
You can browse Logan City Council Dual Occupany Auxiliary policy for more information.
Ipswich City Council
The Ipswich City Council use the term ‘Auxiliary’ to refer to dual occupancy. The Ipswich City Council defines this as a building or part of a building used as a secondary residence not exceeding 50m2 gross floor area, with a maximum of one bedroom associated with a dwelling on the same lot.
The designs we produce for dual occupancy auxiliary units in this area have a maximum of 50m2 of living area and a maximum of 1 bedroom and one driveway crossover.
If you’d like more information on the Ipswich City Council Dual Occupancy policy, please click here.
2. They’re not available everywhere.
As mentioned above, several different terms are used across other Council areas. However, it is worth noting that not all Council areas allow for the dual occupancy product where you have a second dwelling on the one title and can rent it out to unrelated parties.
For example, there are some Council areas in South East QLD where you can build this type of product, but you must sign a statutory declaration stating that you will rent it out to a family member, in essence making it a real granny flat.
Many Council areas allow Duplex properties where there is a set of council fees, headworks fees, and then a process similar to a material change of use for the block of land to make it into a Duplex block definition of a Duplex outlined below.
We can only produce these properties in the council areas that allow for the dual occupancy concept. This means we undertake careful research and study into the different suburbs and pockets within each Council Area to ascertain the best Capital Growth drivers and rental demands.
3. Dual occupancy is different to a Duplex.
Dual occupancy properties are similar to duplexes; however, the critical difference is that a dual occupancy can’t be strata-titled, so they don’t allow the owner to sell off the individual halves separately if they wanted to.
Dual occupancy properties generally have stricter size and bedroom requirements for the smaller auxiliary dwellings than what duplexes have. Other than these critical differences, the dual occupancy product is very similar to a Duplex for the construction methods.
Each dual occupancy has the same firewall and fire protection between the two dwellings; they also have the same separate metres for power and water where possible. If there were a change in the council rules regarding the ability to strata title a dual occupancy property, then the builds we produce would have all the fundamental requirements to allow this to happen.
As dual occupancy properties aren’t strata-titled, they don’t have the second set of rates to pay that Duplex properties must have; this is an additional saving to the investor’s cash flow.
As mentioned above, there are the size and room restrictions in both The Ipswich and Logan Areas. Therefore, it is most common in the Logan area to see a dual occupancy property with a 3 or 4 bed / 2 bath / single garage main dwelling and a two-bedroom / 1 bathroom / single garage auxiliary configuration.
In Ipswich, it is most common to see a 3 or 4 bed / 2 bath / single garage main dwelling and a one-bedroom / 1 bathroom / single garage auxiliary dwelling.
The difference in the configurations is due to the Ipswich city council only allowing a one-bedroom auxiliary. In both the Logan and Ipswich areas, it is common to see formats such as 3 or 4 bedroom / 1 or 2 bathroom / 1 or 2 garages on both sides of the Duplex dwellings.
In many cases, a council will allocate specific requirements to block types for Duplex properties. An example of this is that in the Logan area, a block must be at least 800m2 for a code-assessable Duplex.
This means that blocks of this size are in very high demand, which drives up the price. As a dual occupancy property in the Logan area can go on almost any block size, an investor has a far more excellent choice and isn’t faced with sellers adding premiums and forcing up land prices.
4.They offer a Great Yield
One of the best things about dual occupancy properties is that they offer an excellent yield. A dual occupancy dwelling can get a higher yield than a traditional house by getting two rents from one property.
As there aren’t all of the additional expenses associated with a Duplex property, such as council headworks, strata title fees, two sets of rates etc., a dual occupancy property will generally yield much better than a Duplex.
Duplex blocks are generally more expensive than a standard block of land as developers or land sellers price blocks higher when they know that they can be used to fit a Duplex rather than just a typical house. As a dual occupancy / auxiliary property can work on almost any block in a Council area that allows for them, there isn’t a higher price associated with them.
In short, dual occupancy properties offer the additional income that duplexes do but with far fewer expenses in the land, building, and approval process meaning they produce a much better yield.
5.They Rent Very Well
Dual Occupancy Properties have proven to rent very well. The smaller auxiliary sides of the pair have established to rent well, generally renting faster than the larger three or 4-bedroom side. We believe the popularity of the smaller auxiliary side of the dual occupancy is because of the suburbs we have been building these properties.
The suburbs that we have built them in don’t have that much comparable smaller one and 2-bedroom accommodation on the market. There are many houses and some townhouses built in these suburbs but very few smaller properties that would compete with these.
When you are in Brisbane city, there are large numbers of apartments that are one and two bedrooms which would compete with the rental of these auxiliary properties. However, as the suburbs we build in don’t have apartments on the market, we see robust demand and a lack of supply.
Many people are looking to rent smaller low maintenance properties and aren’t looking for a whole house that is very well suited to these properties.
Another advantage of renting these properties is that there aren’t large apartment buildings or higher density complexes. When there are inner-city suburbs with large higher density properties being developed and hitting the rental markets, the additional supply can cause a short-term oversupply which drops the average rents in the area.
6. Not all builders will build Dual Occupancy properties
It’s important to remember that not all builders will build a dual occupancy property. If a builder hasn’t had experience building one of these types of properties before then, you probably don’t want to be dealing with them for one of these builds.
The building of a dual occupancy property is a more complicated process than a traditional house, and it’s best to know that you are dealing with a builder who can carry through with the job. They are much harder to estimate the costs, especially for a builder that hasn’t built one before.
It is also good to look at and possibly walk through some that are under construction or a previously built product, as this will enable you to gauge the quality of workmanship that the builder has. Previous work is sometimes a good indicator of what you may expect from future work and a better indicator than a display home (which are generally much higher quality than standard).
Remember that a builder is only as good as their tradespeople and the finishes that the tradespeople provide. A builder who has been in the industry for a long time and has other properties under construction is more likely to have good-quality tradespeople producing a great product.
7. Designs are essential.
Design work is essential for all built properties; however, it is even more important for building a dual occupancy property. Because of the size restrictions on the auxiliary dwellings, the designs must make the maximum use of the size available.
There are some key design ideas that we try and incorporate to ensure that we maximise space use. This can include using European laundries and providing no hallways or wasted space areas in the auxiliary unit.
Also, because of the fixtures and fitting, the costs associated with building a dual occupancy can add up very quickly if you’re not careful. This includes the additional kitchens and bathrooms, on top of the other separate power and water metres and fire protection requirements.
This makes it even more important to focus on keeping the designs tight and within budget. If a dual occupancy becomes too expensive, it will lose its high yield, which is generally the critical investment goal associated with this investment class.
By observing the above information for dual occupancy properties, we can see that the restrictions are 50m2 of living in Ipswich and 70m2 of living in Logan. These areas don’t include the garage or the undercover alfresco areas. Therefore, we can design the outside areas without too much concern for size restrictions; these are very important in QLD. Many people spend time outdoors for much of the year and take these into careful consideration when looking for rental properties.
When designing a dual occupancy dwelling, it’s imperative to remain focused on the property’s final purpose.
In this instance, it’s an investment vehicle that should be designed to get the best possible yield whilst being attractive to prospective tenants.
This means that it’s vital not to over-capitalise and have adequate fixtures and fittings to meet the design.
Now you’re ready to build a Dual Occupancy Home in Brisbane
As you’ve no doubt gathered from this article, dual occupancy homes Brisbane currently aren’t really a reality. However, there are three areas that are adjoining the Brisbane City Council, where these dual occupancy homes can be built.
New Property Australia is specialists in dual occupancy properties, and we build in Victoria, New South Wales and Queensland. If you would like more information or need help with assembling a dual occupancy opportunity, please do not hesitate to contact us.