With the rising rental market and land being harder to come by, many people are looking for different ways to break into the property market. A dual occupancy project allows for two dwellings on a single block of land creating opportunities for both homeowners and people looking for an affordable place to rent.
So, is it worth knocking down an existing home to build a dual occupancy development? Let’s take a look at the pros and cons of this approach and provide you with the information to decide whether this is the best option for you.
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Find out more about knockdown rebuild specialists and projects by reading one of these helpful articles
What is a dual occupancy home?
A dual occupancy is a house design that incorporates two dwellings on a single property. Often these two dwellings are part of a connected building like you would find with a duplex. This allows you to have two habitable dwellings on a single block of land, opening both opportunities including:
- Renting the dwellings out
- Selling each house
- Providing a home for family so you are close yet independent.
- A mix of the above.
What is the knockdown rebuild building process on dual occupancy homes?
Find the house you wish to knockdown
This step will vary a lot depending on your current situation. If you’re planning to knock down your current house or a property you already own, you’re set to go. If, however, you’re looking to buy, you need to consider the location and research the area. What you need to figure out is who your target market is and what the ideal design would be to attract them.
Choose a builder
Look for builders who are knockdown rebuild specialists and have performed this type of job before. Buildi can help find the perfect builder for your project.
Perform tests and surveys
Before any major construction project, it’s important to perform soil tests and contour surveys. These will provide your contractors with invaluable information about your soil condition and the layout of your property.
Organise a demolition
Usually, finding a demolition company will be left to you to sort out. Your builder may have some companies to recommend, but they’ll leave it to you to organise a time and all the details.
Finalise your design
Here’s your final chance to decide on all your design choices. It’s always cheaper to change things on paper than it is once construction begins, so think carefully about your layout.
Begin Construction
The time is here to start building your new dual occupancy home.
What are the benefits of a knockdown rebuild on dual occupancy?
Save Money on land costs
It’s no secret that land is expensive. A dual occupancy project allows you to maximise the potential profits of a single block of land by building two dwellings upon it. This doesn’t just save you the price of a second block of land but also the extra costs such as stamp duty and upkeep.
If you’re knocking down and rebuilding a property you already own, you won’t even need to purchase another block of land and instead have an opportunity to reinvent the location.
Make more money on rent
If you’re looking to enter the rental market as a landlord, a duplex or dual occupancy development is a great way to get the most out of your budget by providing two rental opportunities on a block of land. With rentals in high demand, this could be a savvy, long-term investment that will provide you a steady passive income for years.
Easy design to adapt to a range of properties
Though you’re building two dwellings, there are plenty of dual occupancy floorplans designed to suit smaller lots. It’s very common for dual occupancy houses to have multiple stories, allowing for plenty of inner space without needing a large footprint.
You can live in one dwelling while renting out the other
Dual occupancy is a fantastic option for the practical-minded homeowner who wants to make the most from their investment. You have the option of living in one dwelling and renting the other.
Different ownership options
One person can own the entire home and rent it out or each dwelling can have separate titles. This provides a few options including you living in one dwelling and selling the other, selling both dwellings to one party or one each to two different parties.
Save money on stamp duty
One of the big advantages of building a new house over buying a pre-existing structure is the money you save on stamp duty. When purchasing a pre-existing structure you’ll need to pay stamp duty on both the house and land, whereas if you build a new home, you’ll only be charged stamp duty on the land. This could potentially be tens of thousands of dollars.
What are the drawbacks of a knockdown rebuild on dual occupancy?
No home design is going to suit everyone and there are some potential drawbacks to a dual occupancy design. Let’s take a look at some of the downsides.
Less privacy for tenants
The shared wall that comes with dual occupancy could potentially mean less privacy for tenants. If you’re living in one of the dwellings, you will want to make sure your neighbour isn’t loud. Some quality insulation will help with noise reduction.
Less market demand
The dream home for most people is still a free-standing dwelling, and with competition from apartments, there is less market demand for dual occupancy living situations. However, depending on where you build, this may not be a huge issue. City areas are in high demand and a dual occupancy house could provide good value to many clients.
Demolition can be expensive and lengthy
When looking at the downsides of a knockdown rebuild, purchasing a property, knocking it down and rebuilding is not cheap. Talk to a financial advisor and have a solid plan as to how you’ll turn a profit before you begin. Be aware that you’ll be in debt for a while, but hopefully, your hard work will pay off.
How much does it cost to knock down and rebuild a dual occupancy?
Demolition costs will usually range between $10,000-$20,000 depending on a variety of factors including:
- The size of the house you’re knocking down
- The slope of your land and access to your land.
- Site conditions including soil, vegetation and contours. Poor weather could impact the difficulty of your
- Who you hire
As for the price for the dual occupancy building itself, it can cost anywhere between $500,000 to $1.3 million. There are so many factors that will influence the price from the design you choose, your builder, price of materials, site conditions and more.
Our tips for knockdown rebuild projects on dual occupancy
- Dual occupancy development excels in certain locations such as city areas, suburbs near busy locations and high rental areas.
- Look into the demographic of the suburb you’re building in. Do a lot of people rent or buy? Are there a lot of families or more young couples? What is the common lifestyle? All these factors can help you build the perfect house to cater for the market.
- Hire a builder who specialises in dual occupancy homes and has good reviews from customers.
- Talk to a financial advisor about your plan for your new venture.
- If you’re looking to rent, consider a property manager as being a hands-on landlord can be very time-consuming.
- Talk to Buildi about your project. We’ve helped clients save time, stress and money.
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