What is a dual occupancy property?
Dual occupancy refers to two dwellings on a single block and can be in a range of configurations; two side-by-side dwellings that share a common wall (referred to as a duplex); or two detached homes located on the one property (referred to as ‘multi-dwelling’ or ‘side-by-side’ developments).
These homes are most appealing to renters looking for a smaller home and a low maintenance yard, such as students, young professionals/couples, and seniors.
What are the benefits of building a dual occupancy property?
Dual Occupancies offer a greater rental return than a single dwelling
When you build a duplex you’re instantly doubling your earning potential. By renting out both homes, you can look forward to a dual income with the potential to earn over 7% rental yields.
A dual income allows you to be in a positive cash flow position, with the rental income covering your mortgage repayments and expenses.
Newer Homes can provide higher rental returns
Further to the increased rental return, newer homes have modern amenities and technologies which tenants are prepared to pay a premium for. These features can also attract higher quality tenants meaning you can reduce the risk of your property being vacant.
The property value can be doubled
If you’re looking to sell in the future, the combined value of a dual occupancy property can be considered greater than that of a single dwelling. Having two dwellings that have been subdivided can also increase the flexibility of your selling options in the future. You can split your investments and sell just one of the homes while keeping the other in your equity.
Lower maintenance overheads
Unlike older homes, as almost everything is covered under builder or appliance warranties; there will be minimal maintenance required. Even over time, any costs that do arise will typically be lower than that of older homes.
Quick approval turnaround
The best way to take advantage of building dual occ in the current rental market is to get quick approval. The Best way to do this is by undertaking a CDC approach which requires you to provide more documents at the start of a project but with the right draftperson and certifier you could have approval to build in half the time compared to a DA.
What are the best suburbs in Newcastle to build Dual Occupancy Houses?
If you’re thinking of knocking down and rebuilding we recommend looking for properties in older suburbs across Newcastle with larger blocks of land. It’s also good to take into consideration the demographics you’re wanting to target and how accessible public transport and facilities are.
Some popular Newcastle suburbs for developments are:
- New Lambton
- New Lambton Heights
- Mount Hutton
Before jumping into purchasing a property to build a duplex on, we encourage you to assess your financial situation with your accountant or advisor first.
Work with a builder who’s experienced with investment properties
Future Built are Newcastle’s investment property builders, with years of experience working on single and multi-res projects across the region. Our team will work alongside you to ensure you’re maximising the potential of your property to ensure the best return on your investment.
Get in touch with the team today for a chat.