How Does Dual Occupancy Work?

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      FAQs About Dual Occupancy

      A dual occupancy is two dwellings on a single lot. Generally it implies separate services and at least the potential to subdivide at some point in the future. It is often misused to represent primary and secondary dwellings or dual-keys properties.

      Secondary dwellings are permitted through the State Environmental Planning Policy (Affordable Rental Housing) 2009 (the Affordable Rental Housing SEPP) in residential zones (R1, R2, R3, R4, and R5). They may also be permitted in other zones under council's Local Environmental Plan (LEP).

      The development costs for any dual occupancy project will vary between $80k – 120K*. Building costs will depend on the type of duplex construction. Average figures on top of the development are: 2 x 4 bedroom with high-end finishes around $1m.

      Most homes in inner Melbourne don't have the width to allow for a duplex. However, it is possible to build a duplex one behind the other, with the driveway on one side. The downside of this is that the back home doesn't have street appeal, which counts for something when considering resale.

      Currently within the Mixed Housing Suburban and Urban Zones, 2 dwellings are permitted, but the ability to build three dwellings is under appeal. Dwellings within these zones have a minimum size of 30m2 for studio dwellings and 45m2 for one or more bedroom dwellings.

      As a result of the overheated housing market in Australia – notably in our main capital cities – a significant number of residents of the country are considering alternatives to the conventional "quarter-acre dream."

      Dual occupancy, more commonly known as DualOcc, is a real estate option that is gaining in favour. DualOcc is a method for making the most of a piece of land by developing it in such a way that it can accommodate not just one but two or more homes. People who are looking for an affordable place to live in a region that they adore, as well as astute investors, may find new chances as a result of this.

      Dual occupancy refers to the presence of two separate living units within the same lot border on a single piece of land. It is also possible to refer to this type of development as a "multi-dwelling," "duplex," or "side-by-side" development. There is a wide variety of possible arrangements for dual occupancy. This could be two residences that are adjacent to one another, attached to one another, and have frontage on the street. There's also the possibility that there will be one house behind the other, with the driveway entrance located on one side of the property.

      How To Profit From Dual Occupancy Properties

      When markets are in a state of transition, astute real estate investors and small developers think about alternate approaches to maximise capital growth over time.

      Constructing a property with space for both residential and commercial tenants is one of the choices that can be made.

      Not only does a dual occupancy create prospects for increased earnings and yields, but it also gives some people the choice of sheltering an elderly relative or even young adult children who live nearby. This is a significant benefit of dual occupancy.

      Why Build A Dual Occupancy Development?

      You can develop two properties on a single piece of land using a dual occupancy, and once the lot has been strata titled, each of the properties can be sold separately. This is one of the primary advantages of using a dual occupancy.

      In most cases, a dual occupancy, also known as a duplex or two residences in tandem that share common property like a driveway, can be built on a piece of land that you already own or have purchased, provided that you have clearance from the local council and that the site is zoned appropriately.

      It may be an individual who owns an older property, for which it would make more financial sense to demolish the existing structure and construct two new homes in its place than to preserve the existing property and extensively refurbish or renovate it.

      The fact that you will end up with two new homes in your portfolio, but you will only have to deal with one building and design team working on the project for you at the same time is obviously one of the advantages of this option.

      The ideal potential locations for a dual occupancy are those that are located in close proximity to both infrastructure and amenities, as well as those that are located in areas that are appealing to the kind of buyers who are interested in purchasing dual occupancy homes. Check out our selection of dual occupancy builders to see whether one of them is right for you.

      Why Do Dual Occupancy Properties Make Financial Sense?

      Long-term investors have the ability to generate profits from two new properties located on a single site through the use of dual occupancy buildings.

      You now have two properties on the site, each of which is bringing in its own set of rents, each of which has the potential to be significantly higher due to the higher yields that are typically achieved through new dwellings. Additionally, rather than building a single property on the site that is bringing in one weekly rent, you now have two properties on the site.

      If, for example, one property brings in a weekly rent of $750 per week, but each of the dual occ residences brings in $600 per week, then the total amount of rent collected is $450 more each and every single week!

      If both of the properties are being held for investment purposes, then it is likely that the value of the land component of the site will rise more quickly than the value of a normal apartment in a large complex.

      Dual Occupancy Strategies

      Some investors choose to build a dual-occupancy building with the intention of selling it after it is finished. This allows them to keep more money in their bank account, which allows them to invest in something even more lucrative.

      In a similar vein, some people choose to hold on to the property for the long term in order to take advantage of its increased potential for capital growth as well as its improved cash flow.

      Still others opt to live in one of the residences while renting out the other one to renters or possibly using it to provide a roof over the heads of their ageing parents.

      Finally, but most certainly not least, some people choose to sell one of their homes and live in the other, which frequently results in their starting out with either no mortgage at all or a mortgage that is significantly reduced in size.

      Dual occupancy constructions have the potential to generate substantial profits, regardless of whatever approach is most suitable for you, provided that site selection and construction competence are optimised. The importance of quality cannot be overstated in any aspect of real estate. Naturally, this is one of our strengths, as we have assisted a large number of homeowners and investors in achieving successful outcomes from dual occupancy builds over the course of our company's history.

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      Why Opt For Dual Occupancy?

      When compared with conventional purchasing, the DualOcc development provides property owners and buyers with a greater number of options, making it an excellent choice for prospective new builders at all stages of life. Those who currently own land may decide to go the DualOcc route in order to maximise the potential of their parcel, while those who are in the market for property may select a lot in order to maximise the potential of a DualOcc development. Dual occupancy is a method of maximising the potential of a piece of real estate, whether for residential use or for the generation of rental income.

      Dual occupancy provides property owners with the opportunity to demolish one of their existing homes and replace it with two or more contemporary residences on the same block. You might choose to sell one of the homes and use the money from the sale to buy the other one or put it up for rent so that you can continue to be a part of the community you love. You might also use DualOcc if you want to bring your elderly parents or adult children closer to you while yet preserving their privacy and freedom.

      Because DualOcc presents the opportunity for investment, it is frequently selected by intelligent property owners. If done carefully and with the assistance of knowledgeable guidance, the construction of many dwellings on either already-owned land or newly-purchased blocks of land can generate revenue and rental returns.

      How Does Dual Occupancy Work?

      Dual occupancy developments can be one of two different types: the standard side-by-side option, which is sometimes referred to as a duplex, or stand-alone townhomes, which are typically placed one behind the other in a row.

      In most cases, duplex complexes are required to have separate driveways, whereas detached townhouses may be able to share a single driveway. When it comes to the optimal amount of land for a development with two separate occupants, there is no single quantity that can be cited. Your development goals and the rules and regulations of your local council will both play a role in determining the right land size for your project.

      If you are on the market for property for a DualOcc development, a good rule of thumb is to search for blocks where the slope is no more than three metres in either direction. If not, it could make the construction more difficult and drive up the expenses.

      What Are The Benefits Of Dual Occupancy?

      When executed well, a dual occupation can result in a number of positive outcomes, including financial and emotional advantages. For some people, the most appealing aspect is the possibility of achieving their investing goals, while for others, the most appealing aspect is the possibility of living reasonably in a region that they adore.

      Wayne Ritchie, a resident of Melbourne, made the decision to build a dual occupancy home with Metricon. "At first, I had the idea of constructing a large home on a single lot in the Bentleigh area," he adds. However, we were unable to come up with anything that met all of the requirements.

      After purchasing a dilapidated brick home in a highly desirable neighbourhood of Melbourne, he made the decision to demolish it and rebuild in its place. He subdivided the ground and constructed two homes on it: one for himself, and the other as a rental. According to what Wayne has seen, "the return is almost the same in terms of capital growth and depreciation benefits, multiplied by two."

      Because everything went so smoothly, the family has just finished constructing their second home that contains two separate dwellings. "By this point, it had become second nature," he observes.

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      Are There Any Drawbacks?

      It is in your best interest to complete your research before making one of the most important choices of your life, which is to decide whether you want to build a new house for yourself or as an investment.

      Most crucial, check to see if the municipality in your area will let you construct a building with a dual occupancy. In addition to this, you will need to familiarise yourself with the various zoning and planning systems that are in place in your area.

      If you don't start off by getting the appropriate counsel, you could end up squandering a lot of time and money on initiatives that are doomed to fail.

      It is essential to consider feasibility. Are you able to afford the development, and will the potential profits from sales or rentals be enough to cover the costs?

      Get an experienced builder on board who can help you achieve your goals, such as Metricon, which has been in business for more than four decades. Are you thinking about giving your home a makeover?

      What Factors To Consider For Dual Occupancy

      Dual occupancy development could be a great opportunity under many common circumstances.

      Knockdown an existing property and rebuild two new dwellings could be an option if:

      • You own a sizable parcel of property in a region where the value of land is expected to continue to rise.
      • You no longer require a sizable home but choose to remain in the area where you are now living. This can be the case once the children have reached adulthood and moved out of the family home.
      • You have decided to cash out a portion of the equity in your property.

      Building a new residence behind an existing residence could be an option if:

      • There is room available on your block that is not being used, such as a backyard or space on the side.
      • Your family can comfortably live in the home that you already own on this street.
      • You have accumulated a lot of equity in your home, and you would like to cash out some of it.Options once you’ve built a dual occupancy home

      If you decide to build a dual occupancy home, there are a range of options available:

      • If you put the two houses on separate titles, you will be able to sell one of them while keeping the other as your primary residence.
      • You may establish a new stream of income by living in one of the homes while renting out the other. This could be especially helpful in regions where there is a limited supply of rental housing and where rents are rather high.
      • You have the option of selling both houses.

      As a result of the fact that land values have climbed more rapidly in recent years than the values of houses, a significant amount of equity has been accumulated in the property that many people's homes are situated on. The equity that you have built up over the years might sometimes be released from a home that has been converted to accommodate two households.

      Points To Think About When Building A Dual Occupancy Home

      When it comes to the approval of dual occupancy developments, each municipality will have its own set of regulations to follow. The zoning of an area is another significant consideration that will play a role in determining whether or not dual occupancy is permitted. This can include the width of the block's frontage, the measurements of the block, the percentage of the home footprint that is covered, and the number of driveway crossovers. Because of the difficulty of the approval procedure, it is essential to collaborate with an architect or builder who will oversee the approval process on behalf of the local council.

      Service Options For Dual Occupancy Development

      When it comes to the development of a property with a dual occupancy, there are various different alternatives. If you already own a piece of land or a house that only has one family living in it, you can hire an architect to design the project for you, and then you can collaborate with a town planner to seek approval from the local government. We have a lot of customers who already have blueprints that have been finished and approved, and we construct from those. This comprises developments that have dual occupancy as well as multiple occupancy.

      Imagine that you own a piece of land or a house and that you require some advice and. If this is the case, you should approach Silverline Homes so that they can give the whole service, which includes establishing whether or not the project is feasible, obtaining the project design, handling the process of obtaining council approval, and constructing the dual occupancy property.

      The Steps Involved In A Dual Occupancy Development Strategy Are:

      • Finance preapproval. It is crucial to have a preapproval from a lender in place before you start looking at development sites or any property before you start looking at properties.
        Gain an understanding of the requirements imposed by the council for multiple occupancies in this area. Have a look at the local environment plan (LEP) and the development control plan that the council has created (DCP). You will be able to calculate the minimum and maximum lot sizes required for your dual-occupancy dwelling using this information.
      • Put most of your emphasis on the spot where you intend to develop, and check to see whether or not the land there is appropriately designated for dual occupancies. However, even if it is zoned for the construction of this kind of building, there may be restrictions on the land that prevent it from being built. It is essential to limit your options to only one or two suburbs after conducting research in this area. This is a highly critical stage, and at this point you need to have a good understanding of the area.
      • Look for land that can accommodate both residential and commercial use. Size: take a look at the frontage and determine the minimum width that your dual-occupancy building requires. It will depend on the duplex design that you want to utilise as to how much frontage you will need for a duplex site, but it will likely be between 18 and 20 metres. Examine the depth and size of the property to ensure that it is large enough to satisfy the DCP standards.
      • Additionally, examine the aspect of the land and determine whether or not there is sufficient room to satisfy the minimum requirement for outdoor private space. Check to see that there are utilities like gas, electricity, and sewerage near the location. The next step is to check whether or not there is a drainage easement at the back of the property and ensure that the ground is basically flat with a modest slope to the street.
      • You should check the planning certificate to discover if the property is located in a flood or bushfire zone. You can still build in these places, but the price per square foot of your finished product will be higher.
      • Request an inspection of the site from your builder. This is particularly significant because the builder will examine the property from a distinct vantage point.
      • Conduct a feasibility study to determine whether or not the project will be successful. You will first need to locate recent comparable sales references before you can use this data as the foundation for your final value estimate. Have conversations with real estate brokers regarding the current state of the rental market and the rent that might be anticipated, and then calculate the anticipated yield once the project is finished. You need to have a solid comprehension of the construction expenses, which is of the utmost importance. During the course of the design and planning phase, the expenses of the build will change. Once a concept plan has been developed, your builder will be able to provide you with an estimate. However, once the builder has access to the complete designs and documents for the development application (DA), they will be required to hold a full tender. You are able to verify this information by comparing it to your first estimate. If everything checks up, you can file the DA. In the event that this is not the case, you will need to revisit the design and investigate potential areas of savings. If the council has any changes it wants made to the designs, the builder may conduct a second tender after the drawings have been authorised. In the event that this does not occur, the final bid will be put together once the engineer's plans for the construction certificate (CC) are made available.
      • Achieve possession of the dual-occupancy property and negotiate with the seller for a protracted settlement period and authorisation to file a development application. Before settling on the land, you can complete all of the design work and possibly even get the DA and CC granted; doing so would lower the holding costs associated with the property. Make sure that the subdivision is included on the DA that you submit.
        After you have received approval from both the DA and the CC, you can then return to your lender in order to secure an unconditional construction loan. The function Object() { [native code] } will be able to get started as soon as this component is in place.
      • Depending on the climate, the construction phase of a home with two households sharing living space should last approximately three to four months. You are required to make a weekly visit to the construction site in order to monitor the work that the builder is making and put out any "fires" that may occur while the building is being built.
        An occupancy certificate will be granted after the conclusion of the construction work. You are now able to find tenants for your villas. Don't forget to place an order for a depreciation schedule; doing so is easy; just send your quantity surveyor an email with the designs, the builders' tender, and any other cost details.
      • You are now able to submit an application for the subdivision certificate, and as soon as the council issues it, you will be able to register the subdivision (after your lender has signed off on it). You do not need to register the villas immediately if you intend to keep on to them and do not intend to refinance them. If the villas are retained on one title, you may discover that charges such as rates are a little lower than they would be otherwise.

      And regardless of whether they choose to buy, rent, or sell, all of them discovered that even though these kinds of real estate projects are thought to be on a smaller size, they are nonetheless capable of producing significant outcomes if carried out by the appropriate team.

      I have provided a very brief summary of the procedure; but, it is not quite as simple as I have made it sound. You will need ample time to carefully plan out this development strategy, as errors in this step can result in significant financial losses when developing the property. If you hire a seasoned property development project manager, though, you won't have to choose between having your cake and eating it too. You will be able to keep your current employment, gain a significant amount of knowledge from the process, and be assured that you are in the capable hands of a professional. After then, you could discover that you are prepared to take on the subsequent project all by yourself.

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