The Australian Federal Government has been telling us for a long while now that we should save for our retirement. Various inter-generational reports and future economic forecasting by government suggest that in the near future extraordinary amounts of money will need to be saved for individuals to plan for their own retirement and to avoid the looming Australian Housing Crisis.

The Current Situation

Government is withdrawing from social welfare spending across the board. This means that a large number of people who would have expected that they could access Government funded special or supported accommodation as they age now need to be able to look after themselves.

As matters stand there are simply not enough age care facilities funded by the Australian Government to adequately house the aging population that exists at the present.

Many of our elder citizens will need to change their living arrangements after they retire owing to changes to their health, mobility and relationships.

Traveller Trends

There are also a number of Australian self-funded retirees who no longer wish to have the burden of maintaining a large family home while they travel either in Australia or abroad.  It is all well and good to be a grey nomad and to see the world and to have an exhilarating lifestyle while you are doing it.  It is also good to have a home base to return to and a granny flat can be an excellent arrangement for the grey nomads to touch base back in their state of origin on the occasions that they need to relax and wind down from their trips and holidays.  It also gives you a domicile for the purposes of voting and citizenship.  A small granny flat can also provide an address from which you can record your company directorships, maintain a library membership or register and insure your boat, car and caravan.

Future Action

In anticipation of the future aged care housing shortage, the Federal Government has been putting pressure on State and Local Governments to streamline the way that they regulate the construction of small structures and extra dwellings on existing blocks of land with houses.

In the past, no two councils could be relied upon to have the same regulatory framework and there was a great deal of difficulty in building an extra dwelling on the property without formally subdividing or strata titling that property.  Enter the granny flat revolution.  They call them granny flats, plugins, modular housing, mobile or relocatable homes, and Fonzie apartments.

Building A Granny Flat

In many states of Australia granny flats are being erected as separate dwellings on a property and can be used as a secondary source of income.  This is not the case in Queensland.  Unlike building a home from scratch, granny flats can have a fast-tracked government approval process which can reduce the bureaucracy and paperwork required for a new dwelling from six/eight months to 10 or so weeks.

Owing to new building materials, architectural standards and designs, granny flats can be built along the most basic lines or can be constructed to accommodate the most lavish or luxurious tastes.  It is all up to the builder’s depth of pocket and lifestyle priorities.

Granny Flats: An Affordable Alternative

The number and complexity of the various nursing home, retirement and supported care facilities can be considerable.  Retirees intending to buy into supported accommodation may be required to move many miles from where they are accustomed to living and set up new homes with new people who they do not know, at a time in their life when they are least able to accommodate change and are not welcoming of new environments.

The eventual cost of these arrangements can also be difficult to initially forecast.  Residents moving into residential care generally only obtain a mere licence to reside, they are compelled to tie up many thousands of dollars in bonds and arrangements with the care providers and there is often very little left of these bonds when the occupant eventually leaves the supported accommodation or passes away.  On exit there can be extensive administration costs, fees and levies that are applied to reduce the funds retained by the nursing home.

Granny flats can represent an excellent alternative for the elderly who wish to downsize but retain some control of their funds and living arrangements.  Granny flats meet the needs of those individuals when they can make arrangements with their family members to either build on a family member’s block or to use their own land to erect a granny flat and allow their original home to be used by family members or rented out.

Why Do You Need A Lawyer?

Lawyers can be very useful at the beginning of the transitioning from a larger dwelling to downsizing to a granny flat stage.  Special care agreements and support arrangements can be entered into by deed or other binding arrangements that spell out who is to own the property, how it is to be maintained, how any profits are to be apportioned and how it is to pass on at the time when the property can no longer be used.

With respect to the elderly making arrangements with their younger relatives, these agreements can also incorporate carer arrangements and formal documentation can be entered into to allow the cost and support services of an individual for their elderly relatives to be reduced to writing and to be made enforceable and to also ensure that going forward once the granny flat is built that the occupants of both dwellings know what obligations they owe to one another (rather than simply leave things to chance and hope that all will go well).

Granny flat living construction and care agreements need to be put together at the start of the arrangements in a way that everyone who is a stakeholder knows their rights and obligations.

How We Can Help

Ryan Murdoch O’Regan Lawyers can assist you with:

• any construction contract with a builder,
• loan arrangements,
• buy/sell agreements,
• options to purchase or exit strategies,
• valuation arrangements,
• approval process,
• compliance with requirements of council and regulators,
• negotiations between the parties,
• security arrangements, and
• preparing all documentation between care providers or ancillary arrangements.

Your specific granny flat establishment arrangements can also be backed up with enduring powers of attorney, wills and any other instruments or arrangements that can ensure that the agreements stand the test of time and reflect the true arrangements entered into between the parties.

Failure to undertake the necessary documentation or to get the right advice can lead to catastrophic results and often results in elder abuse and very difficult living arrangements.

Contact Us

Get the best representation. Contact Ryan Murdoch O’Regan Lawyers on 1800 999 529, email mail@rmold.newwebsite.live, or submit an enquiry below.

We are available to meet with you at any of our local offices (Brisbane, Gold Coast, Beenleigh, Cleveland and Jimboomba) or by telephone or video-conference.

This article is for your information and interest only. It is not intended to be comprehensive, and it does not constitute and must not be relied on as legal advice. You must seek specific advice tailored to your circumstances.