Investing in granny flats can be a great way to improve your cash flow but there can be some negatives also. In this episode we talk about the pros and cons of investing in granny flats when implementing the 2 properties to financial freedom strategy.
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0:00 – Introduction 0:26 – What exactly is a granny flat
The Pros of Building a Granny Flat
1:48 – #1: Generating extra/positive cash flow 4:18 – #2: You get 2 sources of income, diversifying your risk 7:04- #3: Granny flats are quite easy to rent 9:34 – #4: They don’t reduce the rent of the front house much, if at all 11:50 – #5: You can depreciate much of the granny flat yield 12:14 – #6: It doesn’t seem to have a negative impact on capital growth 13:57 – #7: It can give you a clear path to financial freedom 14:57 – #8: You don’t need to own as many properties to achieve financial freedom 19:50 – #9: Granny flats can add to your serviceability for future loans
The Cons of Building a Granny Flat
16:28 – #1: They don’t tend to add equity/value above the build cost 18:20 – #2: The money you invest into a granny flat you can’t use on other investments 20:12 – #3: Sometimes we see a slight drop in the rent of the front house 21:04- #4: Your property may take longer to sell *unconfirmed 23:05 – #5: You’re not going to have 2 separate titles, it will still be on one title
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