Granny flat rental returns in Sydney: the honest numbers
A backyard dwelling is the rare investment that adds income without buying more land. Here's the maths — appraisals, yields and the costs people forget.
Sydney rents have made secondary dwellings one of the most direct income plays available to homeowners: you already own the land, and the dwelling adds a second rent to it.
What they rent for
Across greater Sydney, a well-finished 2-bedroom granny flat typically appraises around $500–580 per week; a modern 1-bedroom studio around $430–490. Our indicative appraisals — COMPACT HOUSE 60 at ~$540/wk, STUDIO HOUSE 50 at ~$460/wk — sit inside those ranges, and we'll obtain a written appraisal for your suburb before you commit.
The yield maths, plainly
COMPACT HOUSE 60 at $145,000 plus typical site costs returning $540/wk grosses about $28,000 a year — a gross yield in the mid-teens against the build cost. No stamp duty, no second block of land, and depreciation on a new dwelling is generous. Run your own numbers conservatively: vacancy, management, insurance and rates all take their slice.
Costs people forget
- Site costs and service connections — quoted per block, then fixed
- A separate electricity meter if you want clean billing
- Landlord insurance and slightly higher council rates
- Property management (7–8%) if you won't self-manage
Wondering what fits your block?
Obligation-free site assessment — the right home, the approval pathway and a fixed price, within 48 hours.
