Airbnbs in your Backyard Are Surprisingly Profitable
More Australians are profiting from Airbnbs. While even spare bedrooms rooms can make a killing, separate granny flats get more bookings and command more pay.
Airbnbs in Australia are making money. Even an apartment with a foldout bed can earn more than $7,000 a year, while four-bedroom properties can earn more than $100,000. A single spare room in Sydney makes an average of 18,000 a year, but self-contained granny flats can earn even more. A granny flat offers direct access, more privacy, and unfettered use of amenities within. Guests can have minimal interactions with the host and can go about their business with fewer constraints. Separate granny flats give the illusion of owning the house instead of just renting it. Separate entrances, kitchens, and bathrooms also make your guests’ stay more intimate and enjoyable.
Planning Your Granny Flat
Granny flats can be built to whatever specifications you have in mind. There are pre-made kits that you can choose from, or you can create a custom design. Builders usually take 10-12 weeks to finish — even less for pre-made kits. Aside from the bedroom, include a kitchen, bathroom, and space for laundry. Don’t forget to include Wi-Fi. Most of your guests will be posting on social media, so Wi-Fi will be appreciated. Opt for fold-out couches to make your accommodations more flexible; you’ll get more bookings with a 2-4 range. Air conditioning is a must during hot summer months — as is heating during cold winters. The majority of guests prefer to have access to washers and dryers, so make sure to include them in your planning. To get good reviews, you need to be meticulous on cleanliness. Guests are always looking for a clean house, and one bad review can be a significant setback. Load the fridge with bottled water and whatever else your guests ask for. Ask them beforehand so they can arrive with a fully-stocked fridge.
You won’t always have guests, but you can still put your flat to good use. Rent it out as a shared office space during downtime. You won’t need to make significant changes — just a few tables and a few extra chairs. Coworkers love informal settings and won’t be bothered by working in an actual living room. You can also consider short-term leases for visiting families or students. Weigh the potential earnings, but make sure you’ll be open during peak seasons.
Return on Investment
Granny flats can cost around $80,000-$120,000. While conservative earnings of about $10,000-$12,000 a year would mean a return of investment of 6-12 years, it’s still a worthwhile investment because you’ll be buying a granny flat for the folks anyway. By converting it to an Airbnb while your parents are still independent, you can reduce — or even eliminate — the cost of building the granny flat.
A granny flat is an excellent addition to your home, especially if you can make a bit of money from it. Airbnbs can be extremely profitable, and you won’t need to make significant changes once the folks decide to move in.