Considering Granny Flats as a Rental Property

Granny Flats For Rent

As a nation that has a long-term love of property, many Australians often find that once their primary home is paid off, it’s finally time to seek out a rental property for investment. This has typically involved a unit or home further away, but now more and more Australians find great appeal in constructing a rental house on their land.

For such an idea, few constructions work as well as a granny flat. Offering the opportunity to build a unit that is modern, custom designed, and can be easily modified and renovated as needed from one tenant to the next. In order to ensure your granny flat rental is built for success, it is vital that you first consider a number of factors that weigh into your chance to build a granny flat for rent.

Can I build a granny flat?


Depending on your local region and the applicable laws, numerous considerations should be factored in the construction of a granny flat for use as a rental property.

First, it has to be a habitable dwelling. While certain constructions on your land, like a pool house, may be used for a variety of purposes, it is not primarily approved & certified as a place for sleeping. If you are looking to build a granny flat for rent, it must possess a construction that is clearly established for a comprehensive living as well as an occupancy certificate from a private certifier. Rather than supposing a fold out couch or outdoor shower is enough to be deemed as suitable by your local council, instead a dedicated bedroom, bathroom, and kitchen should be planned out in the design stage.

Second, there is the impact your proposed construction could have on other residences in your area. Seeking to build a granny flat on your rural property of five acres? No problem. Seeking to build on in the inner city just 10 minutes from the CBD? That may be a problem.

Aside from the effect a construction could have on your land, the consideration of your wider neighbourhood needs to be factored in too. While these issues can usually be navigated, if you propose to build a granny flat for rent to 2 tenants – each of whom may own a car and require a parking permit from your local area (as applicable) – then deciding at the outset the design of your granny flat for rent is essential.


Because the property is on your land, you must be aware that responsibilities for maintenance of the unit is expected from you by the tenant renting the place. Are you largely a good landlord but slow on mowing your own lawn and sweeping the driveway in winter? This would not be an issue if it’s just you living on your lot, but if you have a tenant, you’ll be responsible for ensuring the shared space you have is safe and useable for them.


Renting out a granny flat can be a tremendous investment move. Not only does it allow you to maximise the use of your land, but it will add to the growth of your income and the total value of your land overall. Many investors began their path to substantial wealth by starting with a small construction first, thereafter using it as a springboard to further wealth generation.

For those who desire to pursue this path, using a granny flat as a rental property can be an excellent first start. While this move brings with it some extra considerations beyond the usual owner-tenant agreements seen in a standalone home, it also presents promising opportunities.

With your granny flat rental property on your land, you can ensure your asset is easily maintained, consistently secure, and always in close access whenever an inspection is desired.
Best of all, a granny flat as a rental property can offer a great way to building up a solid source of passive income for you, and all within your own backyard.


  1. Anthony says:


  2. Janie Jordan says:

    Hello. I’m very interested in building a granny flat on my block of land in the Upper Hunter Valley. Do you build there?

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