Low-end Granny Flat/Bachelor Construction Costs

[iamMT]

Hello everyone.

We're looking to generate more rental income from some of our township properties in Gauteng.
The idea is to build 2 or 3 bachelor apartments/granny flats behind each house (as opposed to the typical backroom), but we're afraid of overcapitalizing.

Just trying to figure out how much it would cost to build a low-end dwelling. Basically cheapest everything without it being an unsafe structure.

I don't know where to begin with this so any estimates would help

 

[ToxicBunny]

Hello everyone.

We're looking to generate more rental income from some of our township properties in Gauteng.
The idea is to build 2 or 3 bachelor apartments/granny flats behind each house (as opposed to the typical backroom), but we're afraid of overcapitalizing.

Just trying to figure out how much it would cost to build a low-end dwelling. Basically cheapest everything without it being an unsafe structure.

I don't know where to begin with this so any estimates would help

I would say a minimum ballpark figure will be around 100k for each unit.

 

[id22]

Firstly , check if your property zoning shall permit an additional 2 units. Begin there,then proceed to determine if feasible. Generally, a Durban construction rate per SQM usually amounts to R9000 excluding furnishing and speciality items. You can explore blockwork instead of bricks, semi detached units under one continuous long roof to save costs.

Secondly, you can also extract a typical 40 SQM plan from the internet and as your local builder to price. Keep in mind your architects fees, engineers fees & municipal submissions fees....

 

[iamMT]

Firstly , check if your property zoning shall permit an additional 2 units. Begin there,then proceed to determine if feasible. Generally, a Durban construction rate per SQM usually amounts to R9000 excluding furnishing and speciality items. You can explore blockwork instead of bricks, semi detached units under one continuous long roof to save costs.

Secondly, you can also extract a typical 40 SQM plan from the internet and as your local builder to price. Keep in mind your architects fees, engineers fees & municipal submissions fees....

Thank you. @id22. The online plans will come in handy.
We'll be doing all of this over the next few months.

I'll pop an update in case anyone is interested in this for their own future projects.

 

[rh1]

Hello everyone.

We're looking to generate more rental income from some of our township properties in Gauteng.
The idea is to build 2 or 3 bachelor apartments/granny flats behind each house (as opposed to the typical backroom), but we're afraid of overcapitalizing.

Just trying to figure out how much it would cost to build a low-end dwelling. Basically cheapest everything without it being an unsafe structure.

I don't know where to begin with this so any estimates would help

How much are you looking to get rent wise? Over capitalising only comes into play if you planning to sell it. If it is a long term investment plan, think of how long you intend to keep the property, let say 10 years.

Costs ballpark as per above is R300k for the 3 flats.

Are you building out of pocket or financed?

If out of pocket you need to recoup only the R300k, over 10 years that is R30K per year. Now does your projected rental income cover this? and the following:

> Maintenance costs - normal wear and tear and then the bad tenants trash properties
> Increase municipal costs (not sure if it will increase, but it might)
> Other costs. I cannot think of the costs, but there are.