In a statement detailing the Reserve Bank's decision to keep the cash rate at 2%, RBA Governor Glenn Stevens notes the Australian economy is growing, but at a slower rate than the long-term average.
While low interest rates have contributed to consumer's being more confident in property purchase decisions, most regional centres are enjoying a boost with areas closely linked to the resources sector still seeing weakening property conditions.
If annual property growth seems unlikely in your suburb this year, there are still ways for you to earn extra income from your existing properties, even when the market is stagnant where you are.
The annual growth for regional Queensland and New South Wales varies.
However, the annual growth for suburbs like Tweed Heads, Noosaville, Noosa Heads, Marochydore, Mooloolaba, Lismore and Lennox Head is less than 3%, however, rental demand is high with a rental yield between 3.5% to 5%.
We've selected five tips for you to earn additional income.
#1 Build a granny flat
Adding a granny flat to your property can boost your rental yield if you don't wish to formally subdivide your property. Depending on your property you can build a granny flat from as low as $10,000 - $20,000. You can potentially earn a 12% return on the construction costs however rental yield depends on build cost and location as rent prices are dependent on both.
Granny flats are dwellings that are secondary to the main property on a single block. Before building anything, remember that it has to be self-contained with a separate entrance, bathroom, kitchen, bedroom, laundry and living area. You can convert part of your house into a granny flat but it has to have a separate entrance. Don't forget to check with your local council if you require building permits.
With RBA locking in the cash rate at 2%, building a granny flat could make such financial sense right now.
These properties are perfect for that granny flat project.
Granny flat: This property has a separate bathroom, kitchen, dining, bedroom and lounge area on the lower level with a separate entry point perfect for a granny flat. CLICK HERE or image to view this property.
Granny flat: You would not have to build anything else for this property as it already comes with a granny flat. CLICK HERE or image to view this property.
Granny flat: There is a guest accommodation on the lower level of this home that you can either turn into a granny flat or holiday rental. CLICK HERE or image to view this property.
#2 Transform your spare room into a boutique hotel
If the idea of having a stranger living in your home long term isn't attractive, why not rent your spare room to tourists? According to Tourism Australia Visitor Statistics, there were 7.0 million visitor arrivals for year ending March 2015, an increase of 8.0 per cent relative to the previous year.
During March 2015 alone, there were 674,500 visitor arrivals, an increase of 13.2 per cent relative to the same period of the previous year. Leisure arrivals (Holiday + VFR) continued to drive international arrivals growth, with an increase of 8.2 per cent over the 12 month period.
Short-term lets are worth more and you'll have the option to only rent out the room when you want to. You set the price for your listing, your availability, and reservation requirements for your guests. You can also set custom prices to earn more during popular travel seasons.
Guest rooms are typically $140/night. Rent it out on the weekends and you might be looking at $560/fortnight. Depending on the type of property you own, what you earn could be paying off your mortgage for you.
Boutique hotel: This home is near an 18-hole golf course and CBD, perfect for tourists who love golfing. CLICK HERE or image to view this property.
Boutique hotel: This resort-looking home a room with an ensuite for privacy-loving owners. CLICK HERE or image to view this property.
Boutique hotel: This house has two ensuite master bedrooms separated from the main house giving your guest and you the ultimate privacy. With three more bedrooms and three bathrooms all connected by fantastic covered decks, you can accommodate a larger group if you like. CLICK HERE or image to view this property.
#3 Create another bedroom
Adding another room can dramatically increase your rental return. Think of that extra living room that you barely use or closing up an already roofed area outside your house. If you already have a granny flat, turning a one bedroom property into a 2 bedroom property can make you extra income as you widen your renting audience from a single person to a young family. Check with your local council if you would need any permits.
Investment options: Don't let that extra space go to waste. Industrial style décor is a hit now and that shed would be perfect for it. CLICK HERE or image to view this property.
Investment option: If you have a super spacious house like this, consider closing up some areas to make room for more guest rooms for long or short rentals. CLICK HERE or image to view this property.
#4 Move out of your master bedroom
This may sound like an odd thing to do but some property owners do it to maximise their rental income. Clarence Baker, 38, moved out of his master bedroom with an ensuite. "This not only helped me earn better with the largest room in the house rented out but also gave me the privacy both the tenant and I needed. Having their own bathroom makes a big difference."
Investment option: If you're renting out to tourists, keep the room minimalist with plenty of extra sheets and pillowcases. CLICK HERE or image to view this property.
#5 Rent out your carport
Are you living in the CBD or near public transport? If, yes, then your parking spot maybe worth more than you think. Why not rent it out to someone while you're out working the whole day?
Start by talking to friends whom you know would benefit from parking at your place. Alternatively, you can also try online carpark sharing services like Parkhound where people can list their home parking spaces for some "extra pocket money".
According to a user testimony, "The extra cash I make from leasing my parking space on Parkhound has allowed me to pay off my credit card for the first time in years."
Find out from your local council if you need any permit to do this. Meanwhile, here are some properties that come with great investment opportunities.
Investment option: This home which has a newly renovated kitchen is within easy walking distance to the Clarence River and only a short drive back into the CBD of Grafton. The long driveway could be perfect for a Park & Ride. CLICK HERE or image to view this property.
Investment option: Not only does this property have its own granny flat/teenage retreat, it is also just 5 minutes to major shopping centres. With so much land, letting out parking space to drivers could be profitable. CLICK HERE or image to view this property.