Surely anyone with their finger on the pulse can see the writing on the wall: Australia’s housing market is in challenging times. Mass migration and sluggish supply of new homes have skewed the market in favour of property owners, which has simultaneously made it challenging for first-time homebuyers to get on the property ladder whilst drastically increasing demand for rental units. Long-term rentals, in particular, offer newcomers and current residents a place to call home and dual occupancy homes can be one of the best ways to provide housing whilst reaping the benefits of being a landlord of 1-2 rental units.
Here are a few key reasons why dual occupancy homes are ideal for long-term rental purposes:
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There is a Huge Market Demand for Rentals
As of December 2024, cities like Melbourne have a very low 2.2% vacancy rate (11,775 vacancies). So long as housing developments are outpaced by immigration and native demand, there shouldn’t be any surprise that our large metro areas have scarce rental properties available and few vacancies.
While this can make matters challenging for prospective tenants, it’s a boon for landlords because the market is essentially in your favour. Consequently, this means that landlords can command higher premiums for select properties and have greater bargaining power.
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Stable Long-Term Income Stream(s)
Long-term rental units can generate reasonable income and profits, doubly so for dual occupancy homes where both units are put to let. Whereas short-term rentals and holiday accommodations may sometimes yield higher incomes, cities like Melbourne and Sydney are taking action against short-term accommodations and raising levies that can potentially eat away at profits.
Long-term rentals, provided you find good, respectable tenants that pay on time, provide a steady stream of income with much less overhead and (sometimes) hassle as compared to short-term lets.
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Better Appeal for Tenants
A dual occupancy unit can be a great choice for tenants and they tend to be highly in demand. There are various reasons and these may not always be applicable, but generally, dual occupancy units are built in suburban areas on properties that were formerly large, single-family detached units – often from the Builders’ generation.
If your units are located reasonably close to transit or you have sufficient parking, the neighbourhood is safe and quiet, and your tenants are young couples or small families, a dual occupancy home is often seen as much more desirable than a cramped flat in the city centre yet not too spacious as to be impractical.
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Dual Occupancy Homes are More Versatile than Single-Family Detached Homes
This is simply a benefit of owning a dual occupancy home and not specific to rentals. One property can be used as your primary residence while the second is put to let, used as a sort of granny flat for a family member, or both can be rental units.
Since both properties are legally separate entities, navigating many typical challenges of rental units becomes a lot more straightforward with a dual occupancy home.
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Simpler Bureaucracy for Landlords & Tenants
There’s no doubt about it: rental agreements are seldom straightforward. Victoria’s residential rental agreements, for example, contain many essential details that prospective landlords must understand, duties to their tenants, and conditions and terms that pertain to both parties.
Having said that, dual occupancy homes are often much simpler for rental agreements since both properties are separate entities and there is no need to mix your primary residence with the complications that may arise from renting on the same property.
Trevor Homes
Invest in dual occupancy homes by contacting Trevor Homes.
