Granny Flats Included in New Zealand’s Housing Shortage Solution
The housing shortage that we hear about daily, is not limited to Queensland… across the ditch, New Zealand families are experiencing the same problem as their population grows. The Dunedin City Council is making a plan to ease the shortage, and that plan includes granny flats…
Dunedin’s push for more housing: Granny flats for more than just granny
Hamish McNeilly, stuff.co.nz
3 February 2021
Historic homes in Dunedin’s Adam St. The Dunedin City Council has identified green field land where new homes can be built and areas where medium-density housing can be built.
Granny flats, duplexes and infill housing are among the possible options for easing Dunedin’s unexpected growing pains.
Dunedin has been a low growth city for decades, but has undergone a boom in recent years.
Projected population growth means the city needs more accommodation without falling victim to urban sprawl.
Granny flats – or what the Dunedin City Council dubs ‘family flats’ – are currently restricted to family members, care workers or farmworkers.
Council city development manager Dr Anna Johnson said there was now a growing push from councils around the country to have the rules regarding granny flats relaxed.
“It is a fairly new idea for New Zealand.”
The rules could be changed to allow homeowners to build smaller flats on their section and rent them to tenants.
Dunedin’s population is growing and ageing.
Homeowners previously needed resource consent for such work, Johnson said.
The council unveiled a suite of changes on Wednesday, designed to boost Dunedin’s housing supply.
The changes include opening up new land to build up to 3000 new homes across certain parts of Dunedin.
Up to 600 new homes could be built across 16 green field sites in Brighton, Wakari and Portobello. A total of 101 hectares of land has been identified for the sites.
Fourteen new medium-density areas have also been proposed, providing 267ha for up to 770 new homes in suburbs like Mornington, Belleknowes and North East Valley.
Dunedin’s population was ageing as well as growing, so the council’s proposals included allowing smaller building sites to cater for smaller builds.
A study on housing preferences showed there was increasing demand for single-person homes, such as duplexes and apartments, for those aged over 65.
Dunedin mayor Aaron Hawkins says Dunedin needs more housing, but cannot fall victim to urban sprawl.
Mayor Aaron Hawkins said the changes included a range of development options.
It was important that future development occurred within the existing urban environment so the city could avoid “urban sprawl”, he said.
“This is an important step forward in addressing our city’s housing shortfall.”
Sonia Woolley
0403 309 136
Granny Flats and Tiny Houses – Part of the Solution to Homelessness in Mandurah
Homelessness…. unfortunately, it’s taking place right across our country, as everyday Australians struggle with the high demand for rental homes. How great is it to see the City of Mandurah taking such positive steps to reduce this?
Mandurah community service groups and City join forces to deliver homelessness strategy
Shannon Lawson, Mandurah Mail
20 May 2021
Compassionate approach: Mandurah’s new Homelessness and Street Present Strategy (2021-2023) aims to break the cycle of homelessness. Photo: Karleen Minney.
Tiny houses, micro housing and granny flats may be part of the solution to Mandurah’s homelessness issue.
Close to 80 people were sleeping rough in Mandurah in July and October last year, according to a street count – one of the highest numbers in WA.
Tackling the issue is no easy task and requires a collaborative approach according to the nine community service groups who have joined forces to deliver a new strategy with the City of Mandurah.
The new strategy is based on the lived experiences of 60 of the people who were homeless or sleeping rough in Mandurah.
Mayor Rhys Williams said the Mandurah Homelessness and Street Present Strategy (2021-2023), launched yesterday, aimed to break the cycle of homelessness.
The three-year plan focuses on four main objectives to tackle the issue: accessible accommodation, effective support systems, meaningful systemic change, and ensuring safety and security.
Some of the concrete actions to be undertaken include an audit of state and social housing stock, an investigation into using tiny homes and micro housing and granny flat opportunities on existing properties.
“We want to take meaningful, positive action to help people that are struggling to get back on their feet, and ensure there is a place for everyone,” Mayor Williams said.
“Despite negative feedback from some people who have said things like, ‘Don’t attract more homeless here’, we’re gonna put our money where our mouth is.
“This is all about working together to change Mandurah’s story and redefine our ambition for the future.”
The City’s assertive outreach service will be launched soon to connect homeless people with support services. The newly-built $100,000 community kitchen will also be open soon.
Sonia Woolley
0403 309 136
HomeBuilder Program Extended Until 2021
2020 has been a difficult year for many, so it’s great news that the Federal Government has decided to extend its HomeBuilder program. Read below for the details, and see how you too can take advantage of this fantastic grant…
Federal Government extends HomeBuilder program for another three months but at a lower rate
Jade Macmillan, ABC News
28 November 2020
A Federal Government program offering cash grants for housing construction projects has been extended, but at a lower amount.
It had been due to expire at the end of the year but will be extended to 31 March, 2021, at the lower rate of $15,000.
Prime Minister Scott Morrison said the extension was expected to lead to another 15,000 construction projects, bringing the total anticipated renovations or builds under the program to 42,000.
“It’s critical we keep the momentum up for Australia’s economic recovery,” Mr Morrison said.
“Extending HomeBuilder will mean a steady pipeline of construction activity to keep tradies on the tools.”
Price caps and time limits changed
Property price caps for new builds in two states will be lifted for contracts signed between January and March next year, rising to $950,000 in New South Wales and $850,000 in Victoria.
The amount of time all approved applicants who signed contracts on or after June 4, 2020, are given to start construction will also be extended, from three months to six months.
The decision follows calls from the construction industry for more flexible deadlines, with concerns people could miss out due to a bottleneck of applications.
The Federal Opposition had also called for changes to the program, arguing it had failed to deliver on its promises and amounted to a “marketing exercise.”
The changes have been costed at $240 million, bringing the total expected price tag to $921 million.
Of the around 24,000 applications made to the scheme so far, the majority (19,180) are for new builds while the rest (4,697) are for renovations.
Key points:
The HomeBuilder program, due to finish at the end of the year, will be extended until March 31
Contracts signed between January and March next year will attract a lower rate of $15,000
People will be given more time to start construction and price caps in NSW and Victoria will be lifted
The HomeBuilder scheme currently provides $25,000 grants to eligible people building a new home or renovating an existing one.
The clock is ticking!
Give us a call TODAY, don’t miss out on your $15,000!!
Sonia Woolley
0403 309 136
What You Need to Know About Granny Flat Agreements
It’s a subject we’ve touched on before – the importance of meeting the legal requirements and protecting all parties when entering into a Granny Flat Agreement. Here’s a great article which will answer all those questions you may have…
Australia: Granny Flat Agreement.
Preston Law
25 August 2020
A granny flat agreement, also known as a granny flat interest and is an interest in accommodation for life which is most commonly used in the context of social security. Such an arrangement is commonly seen as an alternative for elderly family members having to move into a nursing home or aged care facility and allows such elderly family members to move in with a relative (usually an elderly parent and child) in exchange for the transfer of an asset without affecting that elderly family members social security entitlements.
What is a granny flat agreement?
Is usually a family arrangement whereby an elderly family member, generally a parent, in exchange for an asset is granted a granny flat interest in a relative’s home for that elderly family members exclusive occupancy.
The elderly family, their partner or a trust or company that they control must not own the property that relates to the granny flat interest.
Does the agreement need to relate to an actual granny flat?
A granny flat agreement can relate to any kind of property, not just a separate dwelling off a main residence commonly known as a granny flat. The interest created by such an agreement can relate to a room or a separate building on a family member’s land but must allow for your elderly family member’s exclusive occupancy of the space.
What are the requirements for a granny flat agreement?
A granny flat agreement will usually include an exchange of assets for the elderly family member’s right to live in a relative’s property for life. The asset being exchanged may include property and/or cash.
The interest created under the agreement will be either a life tenancy or a life interest. The life tenancy grants to the elderly family member the right to live in the property. The life interest grants to the elderly family member a right to use and benefit from the property as they wish. The interest must not give the elderly family member legal title of the property.
The agreement should set out whether your elderly family member will pay rent, outgoings, utilities and costs for maintenance and repairs.
The agreement must also deal with what will happen should the agreement end. A granny flat agreement may end as a result of the death of the elderly family member, the elderly family member’s medical needs mean it is no longer viable to remain at the property or by agreement. Where the agreement ends by agreement the agreement should deal with how the elderly family member will be compensated upon them giving up their granny flat interest.
For social security purposes, Centrelink requires that if the elderly family member leaves the property within 5 years, they will review the granny flat interest. If the reason for your elderly family member leaving is:
- something you could expect when you created the granny flat interest, the gifting rules will apply
- something that was unexpected, the gifting rules may not apply. Unexpected reasons may include sudden illness, family relationship breakdown, elder abuse or property damage.
Social security implications
We recommend before entering into a granny flat agreement, you seek financial planning advice to ensure that the arrangement will not affect your elderly family member’s Centrelink entitlements.
Centrelink will consider the value of the asset your elderly family member has transferred for the granny flat interest by using the reasonableness test to see if your elderly family member paid more than the interest is worth. Where Centrelink assesses that your elderly family member paid more than what the granny flat interest is worth, they will assess that your elderly family member has deprived themselves of asset and this may affect their social security entitlements.
Do I need legal advice before entering into a granny flat agreement?
Whilst Centrelink does not require the granny flat agreement to be documented in writing it is strongly recommended.
Centrelink also encourage you to obtain financial and legal advice before entering into such agreement. If a granny flat agreement is properly documented it will ensure that your elderly family member has the security of tenure, that all parties are on the same page regarding the interest granted, the particulars of the asset exchanged, the parties obligations for the term of the agreement and the parties obligations when the agreement ends.
Ready for a Granny Flat of your own?
You know who to call!
Sonia Woolley
0403 309 136
Granny Flats and CGT – Changes in the 2020 Budget
There’s good news for many Australians in the latest budget and it’s great to see that families with Granny Flats can reap some benefits too!
Budget 2020: Building a granny flat? There’s a capital gains tax exemption for that
Stephanie Palmer-Derrien, Smart Company
6 October 2020
Ahead of tonight’s budget, Treasury has revealed a capital gains tax exemption on ‘granny flats’, in a bid to provide safe accommodation for elderly or disabled Australians, and to boost the construction sector.
A joint statement from Treasurer Josh Frydenberg and Minister for Housing Michael Sukkar outlined plans for scrapping capital gains tax (CGT) for granny flat situations, particularly where there is a formal written agreement in place.
The measure is intended to help support older and disabled Australians and their families, by making it easier for them to stay close to family members or close contacts, potentially allowing them to stay more independent for longer.
Currently, capital gains tax acts as an impediment to formalising granny flat accommodation agreements, thereby leaving them legally unenforceable, the statement suggests.
“When faced with a potentially significant CGT liability, families may opt for informal arrangements, which can leave open the risk of financial abuse and exploitation, for example following a family or relationship breakdown.”
Under the new measure, which is expected to be implemented as of July 1, 2021, CGT will not apply to formal granny flat arrangements providing accommodation for older Australians, or people with disabilities.
It will only apply, however, to arrangements between family members, or people with other personal ties.
It will not apply to commercial rental agreements.
According to the release, about 3.9 million pensioners and about 4 million people with a disability are expected to be eligible for the scheme.
But, it’s also partly geared towards boosting the construction industry, potentially stimulating demand for small builds in back gardens.
Get ahead of the tax changes and
start planning your Granny Flat now!!
Let us help you on your way…
Sonia Woolley
0403 309 136
Positive News for SEQ, Thanks to HomeBuilder
I think it’s safe to say that 2020 will be a year that we remember for all the wrong reasons. There’s not too much positive news floating around right now, so how great is it to see figures like this?!?! It just goes to show, South East Queensland really is the best spot to be!
South East Queensland land market has strongest sales in five years with HomeBuilder scheme
Property Observer
19 August 2020
The South East Queensland (SEQ) land market experienced its strongest monthly sales in more than five years in June with the Federal Government’s HomeBuilder scheme and State Government grants underpinning buyer demand.
Total land sales in June were 1,110, compared to 273 in April – more than 400 percent increase.
Prices remained relatively stable during the quarter, falling 0.8 percent to a median price of $248,000 compared to the March quarter.
In the 12 months to the end of June, prices rose 1.5 percent.
In terms of sales in each region, Moreton Bay moved into the top spot in the South East Queensland land market, taking 26 percent market share. For the first time since March 2016, neither Logan nor Ipswich have claimed the largest portion of sales.
Logan managed to push Ipswich to third place and achieved 24.9 percent of sales while Ipswich collected 24.7 percent, only a handful of sales separated the two regions. This is the first time that Ipswich has been outside of the top two since early 2015.
After dropping to just 273 sales across the south east in April as lockdowns closed sales offices and dented economic confidence, the market roared back to achieve 1,110 sales in June.
The total number of sales for the June quarter was 1,910, up from 1,518 in the March quarter and the strongest quarterly sales since December 2017.
The data was compiled by Oliver Hume Research by analysing nearly 2,000 transactions across more than 150 projects across Brisbane, Gold Coast, Logan, Ipswich, Moreton Bay and Redland local government areas.
Oliver Hume National Head of Research George Bougias said the HomeBuilder grant, combined with record low interest rates, was driving the demand from first and second home buyers.
“Despite the Coronavirus shutdowns and their economic impact, there are still plenty of buyers with stable incomes who are more than happy to take advantage of the numerous grants and incentives available,” he said.
“These are the right incentives at the right time and will keep thousands of tradies in jobs as homes begin to spring up on these blocks in the next few months.
“The first half of 2019 was a tough time for the SEQ land market but there was a solid recovery underway towards the end of the year and right up until the lockdowns commenced in the final two weeks of March,” he said.
“With the restrictions lifted and the great incentives in place the pent-up demand is returning.”
The $25,000 HomeBuilder grant combined with $15,000 first home buyer grant from the State Government, means eligible buyers can access $40,000 to help them get on the property ladder. Other incentives, including the First Home Loan Deposit Scheme (FHLDS), can save buyers thousands more on top of the grants.