Many people have had problems with approvals, rules, regulations, inclusions and pricing because they have been given the wrong information. This small guide will step you through the process and educate you so you can't be taken advantage of.
Congratulations, you have taken the first step on finding out more about what is involved with building a secondary residence, (The government has changed the policy from being called granny flats to now secondary residences but it is the same, we presume because they wanted to be politically correct in this day in age).
Reading an entire book can seem like a big task but we believe an important one to get a full understanding of the requirements to build a secondary residence. We want to make sure you're well educated and informed to ask the right questions to work with the right people to get your project to be the best solution for you.
Thank you for taking the time to read this, if you have any thoughts on what questions you would want answers to, we would love to hear them. We have pulled this information from questions and most popular information given as Rob and I have meet hundreds of people on site inspections to discuss their projects.
We enjoy doing things differently and really appreciate you taking the time to better understand the process and journey you're about to take on.
All the best!
Jacki Valk
Co founder
ROBERT VALK
THE POD CANBERRA
C H A P T E R 1
Building a secondary residence takes a lot of people to coordinate, do you know all of the rules and regulations of doing so?
It has come to my attention that a lot of people in the building industry do not know what the rules are pertaining to secondary residences. There are many requirements and rules that are crucial to building a secondary residence. I run an architectural firm in Canberra and I have worked with the rules, regulations and councils for over 35 years from small renovations to embassy’s and commercial buildings. I thought I would put the rules into my own words, for our clients to have in plain English. Therefore I hope this helps you in what you’re requirements might be for your particular circumstances.
C H A P T E R 2
Zoning in the ACT can get confusing and reading the rules online are not always clear to those who do not work in the industry. Therefore we have summarized the zones in Canberra and will show you how to find out your zone on your property.
The Housing Rule in Canberra uses zones based on the Territory Plan 2008. These zones serve as a practical guide for the government to accustom the planning controls for a particular area or block of land. These zones define how the land can be used and what can be built in the area.
There are 23 different zones which are divided into seven main groups – residential, commercial, industrial, community facilities, parks and recreation, transport and service and the non-urban zones.
We are briefly summarising the residential zones – RZ1, RZ2, RZ3, RZ4 & RZ5. Residential zones in the ACT are areas where the main use of land is housing. Some childcare centres, medical clinics and community halls are permitted to meet the needs of the residents. Industrial and commercial construction are prevented in these zones to protect their residential character.
For more information about the Rules for Residential Zones in the ACT, you can refer to this link from the ACT Government on:
For our brief summary keep reading....
RZ1 – Suburban zone
In general, this is the area or residential zone where most housings in Canberra are built.
RZ2 – Suburban Core Zone
RZ3 – Urban Residential Zone
RZ4 – Medium Density Residential Zone
RZ5 – High-Density Residential Zone
To find out your zone follow these steps:
1. Go to ACTMAPi online. 2. Click basic map, 3. Make sure: road map, cadastre and the lastest ariel photography is ticked. 4. click search blocks, 5. Make sure 'search blocks by street address' is highlighted and then click search. 6. Enter only your street number and name of street, i.e 16 Rosin. Do not say street or close as it is unlikely to return a search result. 7. Click search and scroll down to find your property. 8. Click on the bold top line that has a > on it. 9. that should take you to your property, scroll down and on the left side it will show you the details on your block/ site.
C H A P T E R 3
Getting a secondary residence in the backyard is not as simple as building another dwelling on a property. It MUST in Canberra, comply with the ACT Disability Rules and Regulations.
Many people are interested in putting a secondary house onto their property. Some people want a studio and others love the idea of having an extra 2 bedrooms on their backyard. Common reasons for a secondary residence are for investment, accommodation for grandparents and separation from growing children. Investors get a Pod to rent out and generate income, while families put a Pod on their block for family and visitors.
For disability compliance you do not need to build it with grab rails and ramps straight away. You just need to prove to the ACT government/ council on plans that with minimal changes you can adapt the residence to be 100% disability complaint.
THE CODE
Why does a Secondary Residence need to comply with the disability rules in ACT?
The planning policies for secondary residences in the ACT must comply with Australian Standard AS 4299-1995. Australian Standard AS 4299-1995 or Adaptable Housing Policy, is a regulation that serves as guidance in planning secondary residences to ensure that it accommodates changes of physical ability of the occupant over time. You can find the rules scattered throughout the ACT planning portal website but mainly here.
We believe the reason why the secondary residence code was put into place is to better suit the aging population. More people are not wanting to put family members in homes and more likely to be able to look after them in their homes or in a secondary residence in the back of their current home. The elderly are then able to stay in the area that they are most familiar with which is described by ACTPLA as the ageing in place policy.
The Benefits
Are there any benefits to complying with all of these rules and regulations?
While there are a lot of benefits to having an adaptable friendly secondary residence.
It takes a lot of time and effort to go through the entire process to get a secondary house planning approved but The Pod Canberra covers everything you need to get a Pod on your backyard. The Pod Canberra will do the work for you from start to finish.
What is a secondary residence?
If you’re wondering what is classed as a secondary residence feel free to read our Learn Page on our website www.thepodcanberra.com.au/blog
There are two ways to build a secondary residence;
1. It can be a standalone residence or
2. It can be connected to the existing residence.
It would depend on the best solution available on the site. If it must connect to the existing structure, it is required to have a separate access to it.
The purpose of the Secondary Residence policy from ACTPLA is to include granny flats and to allow for Aging in Place and therefore making sure that all applications can be converted to be fully disability compliant.
C H A P T E R 2
We have summarised the base costs and options you need to think of when building or purchasing a granny flat in Canberra ACT. When looking at building a secondary residence (granny flat), there can be so many options to choose from and all with such different prices. We wrote this section to help you make sure you’re comparing apples with apples.
When looking at building a secondary residence (granny flat), there can be so many options to choose from and all with such different prices. We wrote this section to help you make sure you’re comparing apples with apples.
So how much do I need to build a granny flat?
The cost will first depend on what type of granny flat you like, click here to see the differences in kit homes, modular and on-site builds, you may want something basic or something modern and large.
Every secondary residence is different. But like everything, you get what you pay for.
Base Costs
The base costs can vary with what you choose.
Usually, there are room options suitable for an office, studio options with a bed, one-bedroom, and two-bedroom options. The largest secondary residence you can build in the ACT is 90m2.
Consider asking for quotes from professional granny flat builders. You will usually receive a quote for the build and the base finishes if they offer more fantastic! Get all of the options and make sure you see their previous work
These options for an on-site build or modular build can be anywhere from $90,000 - $400,000.
Just remember that in the ACT there are strict disability rules and regulations you will need to comply with and your secondary residence may not be approvable if the design does not comply with those regulations.
Additional costs usually include these items below:
Tie-in / Connection costs
You will need to connect your new secondary residence to your existing property or to the mains. This will come at a cost and is different for each block.
These connection costs involve:
1- Plumbing connection from the primary residence to the secondary residence (granny flat) of storm water, sewerage and water.
2- Electrician connecting, internet, telephone, Foxtel, to the current house as well as installing new connection from the pole or current residence to the secondary residence (granny flat).
NOTE: You may need to upgrade your power supply too if it’s built for a single -phase. A secondary residence (granny flat) can take up a single phase on its own.
Site costs
Slabs:
If you have an existing shed, carport or garage concrete slabs, they might need to be removed. This can take time and effort but sometimes depending on the structural build of the secondary residence the team can also work around this.
Trees:
There might be significant trees on your block that will need an arborist report and approval to remove, other times the tree is not classified as significant and can just be removed by your builders. If it is deemed as healthy and significant it is unlikely you'll be allowed to remove it.
Gravel, sloping blocks, planter boxes or retaining walls:
Sometimes these items are in the way of construction or will make the build more expensive. Make sure you get details costs that state the site costs for site works to make sure they have covered everything that needs to be required for the site. You can opt for doing this yourself if you know someone who might give you a good price, prior to building a secondary residence. There are all things to ask and ponder over when preparing to build your new granny flat/ secondary residence.
Inclusions to find out more about...
Important things to ask your builder, developer or the business taking you through this process.
Do they include the Plan and Approvals?
This is an essential part of the process that can be costly and very time-consuming. You will require an architect or draftsperson to design the plans and get approval, whether that is for a full DA Approval & BA or just for BA Approval
Which part/s of the process do they provide?
i.e. a turn-key solution? Turnkey is allowing the builder to provide everything to a complete solution meaning you can move in with flooring, blinds, appliances, kitchen, television, etc.
Every builder is different and may provide it up to a different stage. You want to be very clear on what you are getting because they may not have included the flooring, blinds and fit off extras. You need to make sure there are no extra costs once you have agreed or received a final price.
Optional extras
Other options are available too. They come at a higher cost but maybe worth extra of your money. You might want to have high-end bamboo flooring, AEG or Boshe kitchen appliances, Velux operable skylight in the bathroom to watch the stars in the shower at night, you may want a full package with all furniture provided, there are so many options. The key is to have a list of everything you could possibly want. Then markup which ones are absolute musts and work with the builder on prices to get what you want and hopefully some or all of the extras as well.
There are a lot of options that will suit each budget and taste. A granny flat in most cases can be less expensive than building a house or adding an extension. If you want to live in it, you will have different requirements than renting it out. Make sure you know what you want to do with it and also if your plans do change in the future.
To make changes once the property is built or being built, can be quite costly, therefore try and think of as much as you can in the beginning and get quotes based on that.
Check the quotes, see displays, talk to their previous customers and make sure you choose the right builder and they will take care of your project, your soon to be secondary residence.
C H A P T E R 5
An important part of researching for a granny flat is the design that will best suit all of your needs and also provide comfortable living spaces. Any new building is required to meet with 6-star energy rating that will help with comfort and running costs and also provides the use of the latest building practices and materials.
When looking at building a secondary residence (granny flat), there can be so many options to choose from and all with such different prices. We wrote this section to help you make sure you’re comparing apples with apples.
So how much do I need to build a granny flat?
The cost will first depend on what type of granny flat you like, click here to see the differences in kit homes, modular and on-site builds, you may want something basic or something modern and large.
Every secondary residence is different. But like everything, you get what you pay for.
Design
Keeping it simple The architecture of a secondary residence or granny flat should be a modern and simple design. It should have a linear expression to enhance the backyard of any property.
This way your granny flat looks attractive from the existing property and matches the colours of the existing home. It also should have that ‘wow’ factor to enhance the marketability and improved value of the rental and future sale. The internal design has to be maximised for the use of space.
Therefore no corridors and large open rooms that all can maximise the use of the northern sun. Your main bedroom needs to be big enough to accommodate a king size bed and full lounge suite to maximise comfort.
It’s important to have contrast in design and colours to please the eye. Angled roofs and/or shower screens are recommended. Plus having light living colours with a dark charcoal or black window frames and blinds add to enhance visual satisfaction.
Living
The kitchen
The kitchen is such an important part of the home and in a secondary residence design.
We believe that a simple solution along an entire wall with a separate pantry is the best option. Also keeping light and bright colours creates an open space feel. A single linear concept that accommodates all the facilities that one desires to allow for all cuisines.
The bathroom
All secondary residences built from 2018 are required to be able to convert to disability compliant. This must be completed with minimal changes to make it suitable for anyone who may be handicapped. Therefore the bathroom is larger than a standard bathroom to allow for a wheelchair.
I would suggest that the bathroom is accessible from the living, kitchen or laundry area and not from the bedrooms. This is so guests can feel comfortable without entering a private bedroom space.
The rumpus & dining
We recommend a combined rumpus and dining area with L shaped lounges and a 4 seater round table. These stereotypically have been the best options. We feel this would be the best in all granny flats/ secondary residences.
You want to make sure that the kitchen is separated from the dining area before it reaches the lounge/ rumpus area.
This creates a segregated living with designated spots and opens up space. In summary, the design should always look for the simplest method. This is to provide the greatest value of open space while using the minimalist approach.
The added value is also flexibility to be able to use as a disabled residence if and when required at minimal cost to the occupant/owner.
Small house design is the next big thing. Check out our top 5 design elements we love in small tiny homes and secondary residences.
1. Lots of storage space
2. Outdoor area makes all the difference
3. Large double glazed glass stacker sliding doors
4. White everything (use decor and furniture to give character)
5. Down lights and strip lighting
C H A P T E R 6
INVESTORS THIS ONE IS FOR YOU….
What a great idea if you have the land to be able to create an extra rental income from a granny flat in Canberra.
This is income on land that you are paying rates on.
Parents have a house that is comfortable, familiar and they don’t want to move as they get older but they might be wanting their family closer, babysitting or even that little bit of help when needed and they have children/adults that are renting a unit or house – why not keep it all in the family and build a granny flat that you can rent to the kids at the market value or rent it independently for an extra income.
Why not build a granny flat which creates independence, privacy, your own driveway access with an allocated parking space, you can have a veranda and a porch the demand for this is very popular with the two-bedroom design?
The granny flats are modern, personalised interior with all amenities included in the build.
This adds significant value to your existing property/house let alone the extra income that it will create.
How much rental income can I get from a Granny Flat in Canberra?
In Duffy ACT Rob owned the one-bedroom one-bathroom granny flat in his backyard and it will rent for $320 in 2017. The real estate agent said he could easily get anything from $320 – $345 for the one-bedroom and $420 – $480 per week for the two-bedroom two-bathroom design. Duffy is an older suburb of Canberra with larger blocks and really Canberra is spoilt with good size blocks. The agent said that if you were in the more up-market suburbs, for example, Forrest, Garran, O’Malley, Mawson, Hughes then the rentals are increasingly higher and would be consistent with the current rental markets in Canberra. For example: A 2-bedroom 2-bathroom L shape Pod in Chifley ACT rented for $550 in 2019 and a 2-bedroom 2-bathroom in Campbell ACT was rented out at $720 per week in 2020.
Does a Granny Flat increase the Market Value of your Property?
It certainly does and it can be positively geared immediately if you rent it out. The value of your existing property increases as it now has two dwellings on it and looks amazing. The Pod that we built in Duffy is currently used as an office on one side and our daughter lives in the bedroom side with bathroom, wardrobes, kitchen, laundry and pantry… just to name a few. She moved back home from Sydney and she has her own privacy and independence. This works very well for both her and us – we love having her around.
The benefits?
1. Set and Forget
We all get busy in different ways. We need time for family, work, leisure and of course business and investments. It will allow you to spend more quality time with your family.
With a secondary residence as a new investment, you would not need to spend a lot of time checking on it. DA approved secondary residence means you can rent it out legally to any real estate agent. Hence, creating less pressure for you to manage two properties on one block. Your agent can take care of your tenants and check if they need help with anything. The Pod will have separate water and electricity costs as well, so you will have a separate dial showing the usage of each property on the block.
C H A P T E R 7
Living in a smaller home means you can afford nicer quality products and fittings in your home. You will have fewer items and being a higher quality means they will also last longer, therefore, saving you money having to replace furniture and fittings that would only be required in a large home.
LIFESTYLE
We believe that there is a great feeling of freedom and liberation when cutting down the number of items that you own. It becomes a wonderful feeling when the only items that you have, are that of quality. We know many people who would choose quality and live in a smaller studio or 2 bedroom flat than the chaos of living in a large 4-6 bedroom home.
Having a secondary residence means you can downgrade from the larger house or have the secondary residence/ granny flat as a guest house. Being in your backyard is a perfect option to move your kids in there or your parents. This way you’re closer to the family. Otherwise, you can make the whole area an office or studio, which also can make your life happier as you won’t be stuck in the morning work traffic.
There are financial benefits as well. If you rent out your secondary residence/ granny flat it will create a secondary income for the homeowner. The residence will have private access and security if preferred so you each get your privacy and allocated car spaces, letter boxes, separate bills etc.
Interior designers have suggested that having fewer bedrooms creates less stress. You’ll have fewer items and clutter plus every item will have a home (a place to be put). Some also suggest that having an open design with bright internal colours can overall make you a happier person.
C H A P T E R 8
Getting a loan can be time consuming and can give you headaches with the amount of paperwork involved. Here are some tips to get you prepared for your bank manager or broker meeting to save time and to work toward your future financial goal.
Thinking of financing your secondary residence with a Home Loan?
A common way to finance your secondary residence is through a home loan. You can directly transact with your bank or you can reach out to a mortgage broker for some help.
Here are the basic requirements to apply for a home loan to finance your secondary residence or granny flat.
It is important to note that requirements may change based on: when you’re applying, any economic change, what kind of loan you’re applying for, how you are looking to apply for the loan and your personal circumstances i.e. employment status, asset and liabilities, etc.
Each applicant has their own preference to whether they want to go to their bank or to get a few different options through brokers. Just so that you’re aware in our case, banks need much less information then brokers, as mortgage brokers are highly regulated and make you complete a lot more documentation for the same type of loan. We do suggest whatever your preference is to see more than one option/person in regard to your loan, just so that you know you’re getting the correct advice.
Below are the items you should expect to provide any bank or broker with:
Please read through carefully.
Proof of Identification (100 points)
Passport (or Birth Certificate/ Citizenship Certificate)
Driver’s License
Medicare Card
Income Verification
If employed -
Most recent payslips
PAYG Summary (or income tax statement, found on MyGov)
Current Employment Contract (if you are a contractor)
If self-employed -
Most recent years tax returns (personal and business) and financials
Most recent years Notice of Assessments
Financial Statements
The bank will require you to present your last two year’s financial statements. This is the book of information with opening and closing balance, profit and loss, etc.
Tax Returns
This can be supported by a Tax Portal (your accountant can provide this information)
A Broker can help you with this information
Credit Report
You can get it from the link below https://www.equifax.com.au/personal/products/credit-and-identity-products
Construction Documents
For the construction to proceed you need to present the following documents:
You can request the construction documents and/or proposal documents from your builder.
Important Information to Note
Please note that before you can get unconditional approval you must provide approved plans, a contract and a list of inclusions. This means once you sign up to a company generally you will need to pay the initial deposit with your own money that might be refunded from your bank/ broker upon getting the loan.
Many people haven't realised this step and getting a secondary residence can take much longer as companies who do the full process, i.e. plans and approvals, cannot sign a MBA or HIA contract until your plans are approved.
This information regarding loans serves to provide you with general information about the basic requirements that you will need to finance your secondary home with a home loan. It is best to contact your bank or broker to get more information as requirements vary based on your personal circumstances.
C H A P T E R 9
By try we mean test, view, look, meet, talk. We believe it is best to talk to multiple companies in competition, see their products, meet the directors, view their inclusions and what they stand for, talk to their other customers and test their word. Building a secondary residence is a big commitment and a large investment, so you want to make sure you pick the right company for you.
See multiple options of what you can buy. Have questions ready and you will find out the below too if you shop around.
C H A P T E R 9
Have you ever felt something isn't right, but ignored it and then realised afterwards you should have trusted that inner gut feeling?
Our advice with this one is:
Trust yourself, you usually know what feels right.
Robert Valk & Jacki Valk, a Father-Daughter team coming together to change the way we live...
Jacki Valk mentions in her speech from 2019 at Female Innovators in the nations capital, “My mission at The Pod Canberra is that I want to help people enjoy where they live and if it is where they are going to end up forever then I want to make sure they love it and it lasts!”.
Something practical, high quality and all done for you. “To me, these three qualities are something I would suspect that a lot of other people would desire, not just seniors”, Jacki mentions.
Partnering up with Robert Valk, who has the wealth of experience in the architectural, planning & design industry while also a builder, makes this team a solid one. Rob has been teaching Jacki from the very beginning of The Pod. “My dad is amazing, we really work well together. I make things look good and enjoy working closely with clients, while he focuses on design, planning & quality control with the build. “I will never stop learning from him.”, Jacki says.
We are a small family business that not only builds granny flats/ secondary residences but specalises in educating our clients to understand the whole process and details of what is to come.
Below is the image of Bailey, our Pod mascot, he comes on-site and loves receiving tickles from all of our clients and visitors. When you come to visit, he will certainly catch your attention.
