Have you ever wondered from a pension or government allowance point of view just what the criteria is?  We have attached the following for your information  (www.humanservices.gov.au) 22 May 2014 :

The term granny flat right or interest is a description of an agreement for accommodation and not a description of the type of dwelling you live in or rent.

A granny flat right or interest is created when you pay for a life interest or right to accommodation for life, and the life interest or right to accommodation for life is in a private residence that is to be your principal home.

Homes that can be granny flats

A granny flat is usually a separate, self contained building or living area attached to a home or property. Dual occupancy allows the construction of a detached dwelling on a large block where a residence already exists. However a granny flat interest can be created in any kind of dwelling and not just those typically referred to as granny flats. You cannot have a granny flat right or life interest in a property in which you have legal ownership.

We recognize that granny flats are usually family arrangements providing company and nearby help and support for older people. This is not required for a living arrangement to be considered a granny flat for social security purposes.

Whether you live alone, with the owner or in a separate self-contained dwelling on someone else’s property, your home will meet the granny flat requirements and can be assessed under special rules if:

• It is all or part of a private residence
• It is not owned by you, your partner, or a trust or company that you control, and
• You have established a granny flat interest

Granny flat interest

You establish a granny flat interest when you exchange assets or money for a right to live in someone else’s property for as long as you live. For example:

• You transfer ownership of your home but retain a right to live there or in another private property for the rest of your life, or
• You transfer assets, including money, for a right to live in a private property for the rest of your life

There are 2 ways to have a lifetime right to live in a property that you do not own – a life tenancy and a life interest. A life tenancy just gives you the right to live in the property. A life interest gives you the right to use and benefit from the property as you wish. Both ways meet the requirement of a granny flat right or interest provided you are living there

Your granny flat right or interest cannot be revoked because the owner wishes to sell the property. They may :

• Sell the property with your arrangement as a condition of sale
• Transfer your life tenancy or interest to another property, or
• Compensate you financially for losing your granny flat interest

Although we may accept that you have a granny flat interest, even if it is not in writing, we recommend that you have a legal document drawn up by a solicitor to give evidence of the arrangement. This should help to prevent any problems in the future if your personal circumstances change. The document should :

• Confirm you have security of tenure
• State whether you are liable for any upkeep of the property or payment of rent, and
• Outline how you are to be compensated if the property owner cannot maintain your life interest

A granny flat right or interest only exists during your lifetime and is not part of your estate.

You should contact us to see if any of these actions would reduce your payments.

How we assess your granny flat interest

We need to know what you transferred to the property owner in exchange for a granny flat right or interest. We use this to work out if you deprived yourself of assets by paying too much and assess whether you are a homeowner or a non-homeowner.

We do not use a market value to assess the worth of a granny flat interest. Instead, it is considered to be worth the value of the assets you transferred or paid if you :

• You transfer the title of the home you live in to someone else and keep a lifetime right to live in that home or in another home. This applies if your home or would have been totally exempt from the asset test
• Pay the costs associated to build a granny flat on someone else’s property or the costs to convert someone else’s property to suit your needs and established a lifetime right to live there
• Buy a property in someone else’s name and establish a lifetime right to reside there

Provided you pay in 1 of these ways and do not transfer additional assets as well, no deprivation will occur.

If you transfer assets in addition to the above we apply the reasonableness test. This includes the transfer of a home property, part of which would have been assessable.

The Reasonableness Test

If the amount you paid or the value of the property you transferred is more than the value of the granny flat interest, the excess is considered to be a deprived asset. This could affect the amount of pension you are paid.

The reasonableness test is used to determine if you are considered to have deprived yourself of assets when establishing a granny flat right or interest. The amount of the combined partnered rate of annual pension, regardless of whether you are single or partnered, is multiplied by the age related factor. If you are partnered the age of the younger member of the couple is used.

Age related factor

If you are assessed as a home owner

We may still consider you to be a home owner for assessment purposes even though you do not own the property in which you have your granny flat interest. Your home owner status determines :

• if the amount you paid is an asset
• which asset test threshold is applied before it affects your rate of payment, and
• if you might be entitled to Rent Assistance

A non-home owner has a higher asset test threshold than a home owner. The difference between the thresholds is called the extra allowable amount. This amount is compared to your entry contribution.

If you were not assessed under the reasonableness test your entry contribution is the amount you actually paid.

If you were assessed under the reasonableness test, your entry contribution is :

• the value of the granny flat interest, if you were assessed as paying more than the reasonableness test amount, or
• the amount you actually paid if you were assessed as paying less than your reasonableness test amount

How your entry contribution affects your entitlement

If you leave the home that you have a granny flat interest in

If you stop living in the home within 5 years, we will review the granny flat interest. If the reason for leaving could have been anticipated at the time the interest was created, then deprivation rules also known as gifting will apply.

The deprivation rules will apply if you permanently leave the home for the remainder of the 5 years from the creation of the granny flat interest. They do not apply if you are temporarily absent from the home for up to 12 months. If you temporarily leave due to loss or damage to the home, this period may be extended for up to 2 years.

Read more about disposing of your granny flat and gifting.

http://www.humanservices.gov.au/customer/enablers/assets/granny-flats

BACKYARD INCOME : THE INVESTMENT THAT PAYS FOR ITSELF

A Current Affair
Air Date: 05 February 2014

They’re the everyday homeowners bringing in $200-$400 plus a week from the soil in their backyards. Their secret; Granny flats, utilising otherwise wasted space. A Current Affair helps you uncover the treasure hidden right under your nose.

Check out our gig on A Current Affair – Backyard Income : The investment that pays for itself !

And don’t forget to see our YouTube channel to view some of our current projects blogs!

Your Granny Flat Experts : Ipswich Granny Flats

Want to know how to double your rent return ?

Call Sonia – Ipswich Granny Flats

0403 309 136

As part of our current information update, Ipswich Granny Flats presents an article as it appeared in today’s Canberra Times :

GREEN LIGHT FOR BIGGER BACKYARD GRANNY FLATS

The Canberra Times
Meredith Clisby
10.2.14

Homeowners in the ACT can now build larger granny flats in their backyards following the approval of an amendment to the city’s territory plan.

Secondary residences, most often referred to as granny flats, were limited to a size of 75 square metres under previous planning laws.

The ACT government has now approved an increase in size of the dwellings to 90 square metres following industry concern over the limitations of the previous size.

The technical amendment, which came into effect in mid-January, also contained changes to slightly relax the rigid solar rules on home building in the territory.

Variation 306 implemented solar access rules for new homes which were heavily criticised by the industry for creating complexity and additional cost to building a house.

The variation also made it easier for Canberrans to build a secondary residence by removing eligibility conditions on the then termed “habitable suites” or re-locatable units.

Planning Minister Simon Corbell said the increase in size would help builders meet the adaptable housing standards for a variety of layouts, including two-bedroom dwellings. “This means anyone can occupy a secondary residence and provides for more affordable housing options,” he said.

Secondary residences up to 90 square metres can be built on blocks that are a minimum of 500 square metres. While they can be rented out they cannot be separately titled or sold.

Housing Industry Association ACT south eastern NSW executive director Neil Evans said the increase in size would allow a second bedroom to comfortably fit into the dwelling and provide more manoeuvrability.

He said under the previous size restriction it had been difficult to design homes to meet adaptability standards. But he said the government should go further in its laws surrounding secondary residences to allow a small townhouse to be built and also enable the subdivision of blocks on a separate title or lease.

He said this was particularly relevant in the established suburbs of Canberra where houses sat on very large blocks of land.

“That is going to meet the government’s policy on the 50 per cent higher density in brownfield sites,” Mr Evans said.

He said it would allow a bit of flexibility with dwelling types and encourage the construction of small townhouse dwellings, which the territory lacked.

ACT Shelter executive officer Leigh Watson said any decision that made it easier to build a secondary residence was welcomed.

This concession to planning laws follows a decision made in 2013 to remove the lease variation charge imposed on such projects.

Donated (Tracey, The First Tenant)
3 February 2014

As a result of Ipswich City Council’s relaxation of the Planning Scheme now approving Granny Flats to be built as investments, there has been an inundation of enquiries to Ipswich Granny Flats from potential new tenants anxious to rent and move in as soon as possible. The desire for a Granny Flat is the fact that it is brand new with stylish interiors and fittings as well as the privacy and lower rental prices compared to a normal sized dwelling.

Tracey, our tenant for the first new build Granny Flat project in Ipswich was very excited to be part of this Queensland first initiative! Tracey had just sold her own home with Sonia Woolley from Vision Property Group / Ipswich Granny Flats. Our next step was to find her a place to rent somewhere near where she was already living. As luck would have it, the first new build Granny Flat was nearing completion – and a bonus, it was the exact suburb she had wanted to relocate to!

Tracey was the perfect fit for a Granny Flat: a single, mature woman who only needed a small backyard (less to mow!). There was only one problem – we weren’t sure all of Tracey’s belongings would fit into a 2 bedroom granny flat! How did she collect so much stuff – EGADS! I gave Tracey a copy of the granny flat plans to see if everything would fit, as coming from a 3 bedroom to a 2 bedroom house was abit of a worry. As the plans showed the physical room sizes, and with much relief, everything fitted perfectly and looked fantastic! All of the colours and stainless steel appliances complimented her belongings perfectly – Tracey was also impressed that it included a reverse cycle air conditioning unit as well as a dishwasher. Always good to have a happy tenant!

Tracey is looking forward to a brand new start in life, and has been very happy in her new granny flat. With less to clean and mow, it’s given her the opportunity to spend more time doing the things she loves such as cooking, all whilst watching her great collection of movies at the same time in the open plan kitchen and lounge area.

One of the positive outcomes with the dual living has been that Tracey has formed a great friendship with her new neighbour in the main dwelling. The granny flat design has given them both the opportunity to enjoy a good community spirit, but still able to maintain plenty of personal privacy.

Tracey has also discovered when she talks to anyone about her granny flat experience, there’s huge interest in others renting or building one as well. An elderly lady (a Real Granny!) who was looking to rent, on seeing Tracey’s place thought it would be perfect for herself.

Granny Flats are a great step forward – it’s definitely a growing trend! The beginning of a new age for renting and investment property.

ANOTHER HAPPY CLIENT – IPSWICH GRANNY FLATS

CALL US : 0403 309 136

Ipswich Granny Flats agree wholeheartedly with this announcement – 2014 is going to be the year for Queensland, particularly SE Queensland !  All the right factors are in place : low interest rates, lots of hungry buyers, and Brisbane and surrounding areas tipped to lead the growth …

All the property investment experts are saying the same thing about Queensland : watch out 2014 here we come – and Ipswich City Council is the first and only council to allow one of the best investment strategies : Auxilliary Dwellings, more commonly known as Granny Flats.

The Media Statement, brought to you by Ipswich Granny Flats as follows :

Queensland Government

The Queensland Cabinet & Ministerial Director

Minister for Natural Resources and Mines?

The Honourable Andrew Cripps
Thursday, January 16, 2014

Queensland property market activity continues to grow

Queensland’s property market has continued its revival with a strong increase in the number of lodgements with the Queensland Titles Registry in 2013.

Minister for Natural Resources and Mines Andrew Cripps said latest statistics show the Titles Registry received an average 3,240 lodgements per day during December 2013, well above the overall 2013 daily average of 2,640 lodgements.

“These figures are good news for Queensland’s property market and shows continued optimism in the recovery of the economy and confidence in the policies of the Newman Government,” Mr Cripps said.

“Construction is one of the four key pillars of the Queensland economy and strong property market activity is great news for economic growth and jobs in this sector.

“To average 3,240 lodgements in December 2013 compares favourably to the 2012 daily average of 2,470 lodgements and the 2,350 average per day recorded during 2011.”

Mr Cripps said the majority of lodgements during 2013 were title transfers, most of which were property sales, new mortgages and mortgage releases.

“New lot creations also steadily increased during 2013, with an average of 3,460 new lots being created per month for building projects such as subdivisions and housing developments,” he said.

“This compares with the 2012 monthly average of 3,240 lot creations.

“Most lodgements happened online, proving that the Department of Natural Resources and Mines’ eLodgement system is a cost effective and efficient way for customers to do business with the Queensland Titles Registry.”

The Property Council/ANZ Property Industry Confidence Survey released today highlighted that Queensland’s property industry is the most confident in the nation.

Queensland Executive Director of the Property Council of Australia Ms Kathy Mac Dermott said the survey polled approximately 2,600 property and construction industry professionals from across the country in December 2013, seeking their views on the future outlook for the property industry in the March quarter.

“The sustained lift in confidence in the Queensland market during the past 12 months has been most recently driven by the ongoing recovery of the residential market. The survey results are another step towards an industry recovery and a more positive property cycle,” Ms Mac Dermott said.

More information about the Queensland Titles Registry is available at www.dnrm.qld.gov.au/land/titles-valuations

Looking at the bigger picture nation wide, most would agree that we are the 7.00 o’clock stage, moving forward.  There is still good buying for all – but with the market starting to move upwards in all sectors, personally, I believe you will need to make a move by the end of the year at the latest otherwise you could miss the boat!

Great News for Queensland – 2014, poised for great things !

And Ipswich Granny Flats leading the way – an Ipswich first !

Call : 0403 309 136

Planning reforms open up granny flat rentals

ABC.net.au – 4 June 2013

WA’s Planning Minister John Day says he expects thousands of rental properties to open up under reforms to the state’s residential code.

Currently, home-owners who have granny flats on their property can only lease them out to relatives.

Mr Day has announced that from August, granny flats, or ‘Fonzie flats’ built above garages, can be rented by anyone.

He says that could mean up to 30,000 extra properties across WA over the next decade.

“We have a target of 20,000 new affordable homes by 2020. Already more than 7,000 affordable homes have been provided since 2010 and this initiative will make it very likely that we will exceed this target,’ he said.

The reforms, which will be gazetted in July, were flagged by the State Government before the election.

David Airey from the Real Estate Institute of WA says the reforms are good news for the state’s property market.

“Granny flats represent a great opportunity for property owners to be able to provide extra housing into the market and earn some extra income while they’re doing it,” he said.

“There are so many unused granny flats sitting in the suburbs that this will be an amazing increase in the number of properties available.”

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Ipswich Granny Flats Ipswich are proud to be part of the Ipswich City Council initiative to allow Granny Flats to be built for investment purposes – a first for Queensland !

Call Ipswich Granny Flats Ipswich now for a chat – let us show you how you could increase your rent return on your investment property.

IPSWICH GRANNY FLATS IPSWICH, call now : 0403 309 136

CHEERS!