There has been growing residential housing demand. With more demand close to major cities centres throughout Australia, causing governments to seek more affordable housing options. This demand has fuelled higher investment returns and the reason why property investors Love boarding houses.

In 2009 the NSW State government introduced new affordable rental housing policy. This State Environment Planning Policy – Affordable Rental Housing 2009 (ARHSEPP) was formulated to increased supply and affordability for rental & social housing in New South Wales. This has, in turn, led to increased demand and higher property values for boarding houses.

What are boarding houses? What does boarding house mean?

Over the years, boarding houses have unfairly had the perception of providing accommodation for troublemakers in our society. While there might have been the occasional lousy element in the past due to bad management, things have changed a lot in recent years.

In addition, many boarding houses are well-appointed with quality inclusions hardly noticeable in residential and commercial areas. As such, boarding homes well designed and managed house rules to attract reliable quality tenants. Thus providing an excellent, consistent cash flow income for the owners.

Boarding houses aim to provide affordable low-cost shared housing accommodation for people who do not have the need or affordability to paying rent via traditional housing accommodation.

What are the benefits of Boarding Houses?

Generally, Boarding Houses give better returns than traditional residential property.

The planning policy allows for exclusive bonuses in Floor space for lot size

There can be various tax advantages.

What are the features of boarding houses? What is a boarding house, tenancy?

They provide lodgers short term rental residency for a period of three months or more.

They may have a separate or shared bathroom, kitchen, laundry and living/common area rooms.

Part or all of the building can be rented out for lodging.

How do you set up a boarding house, and where are you allowed to build them?

You were allowed to build boarding houses with council consent in most areas including low, medium and general residential areas.

Property investors and developers would have to lodge Applications with the council for assessment. This assessment will consider the consent based on the buildings design, fire safety compliance and various and environmental factors.

The boarding house development should also be designed to be in character with the local area.

What is the maximum amount of rooms allowed?

In New South Wales, new boarding house developments in low density, areas are limited to 12 or fewer rooms. In other areas, the maximum amount of rooms permissible would depend on the floor space ratio and height limits relevant to local council environmental plans.

What are the other special requirements for these property investments?

The rooming house development proposal is appropriately designed to be in harmony with local area.character

Be close to public transport services.

Appropriate landscaping and property setback to be congruent with the existing Streetscape.

At least 20 m² of open private Space to be included and eight m² next to the boarding house manager’s accommodation (where applicable) in addition to the Front of property setback.

One car parking spot for every two rooms in all locations and one parking spot for each person who’s working with the development and is also a resident on the property. Also, one cycle parking space required for every five rooms.

At least one communal room receives at least three hours of direct sunlight during the day in mid-winter.

The smallest room size is 12 m² for single rooms and 16 m² for double bedrooms with a maximum room size of 25 m².

The maximum of two lodgers is allowed per room.

At least one communal living area is required for the house residents if the boarding house has more than five shared boarding rooms.

The lodging-house must have reasonable kitchen and bathroom shared facilities within the complex. Self-contained food preparation areas and bathrooms are allowed but not a requirement for each room.

In addition, an on-site manager is required if the accommodation house has 20 or more residents.

When a boarding house is developed in a commercial zone, the ground floor which fronts the street cannot be used for residential purposes. The only exception is if another planning instrument permits it.

Sound like a good Property Investment for You?

To sum up, it may be possible that the highest and best use of your property could be for a boarding house. Like to find out? Contact Con Tastzidis at CST Properties on 02 9882 2221 for more reasons why property investors love boarding houses and why you might too. For a free appraisal on 02 9882 2221 or fill out this form via this link