Last year Waikato Real Estate’s Head of Growth, Michelle, and her husband Olly (also a Manager at Waikato Real Estate) were busy cleaning up the grounds on their investment property on Dinsdale Road.
After removing some bushes and filling in an old fishpond they discovered there might be an opportunity to add an ancillary residential unit (aka granny flat or minor dwelling) to the property.
This is the story of how they went about doing just that…
But. before we get to the fun stuff, lets recap on the HCC’s rules on Ancillary Units in the Hamilton City Residential Zone.
Last year Waikato Real Estate’s Head of Growth, Michelle, and her husband Olly (also a Manager at Waikato Real Estate) were busy cleaning up the grounds on their investment property on Dinsdale Road.
After removing some bushes and filling in an old fishpond they discovered there might be an opportunity to add an ancillary residential unit (aka granny flat or minor dwelling) to the property.
This is the story of how they went about doing just that…
But. before we get to the fun stuff, lets recap on the HCC’s rules on Ancillary Units in the Hamilton City Residential Zone.
What is an Ancillary Residential Unit?
A self-contained residential unit is held in common ownership with the primary activity on the site.
To be self-contained the ancillary residential unit must have a kitchen, bathroom, bedroom(s), living room and laundry facilities. The ancillary residential unit can be attached to the principal building or be a detached stand-alone structure.
Ancillary residential units can be constructed without a resource consent within the Hamilton City General Residential Zone where the net site area is 600m² or more and where relevant development standards are compiled with. Net site area refers to the area of the site excluding any entrance strip, internal vehicle access or private way.
The maximum gross floor area for an ancillary residential unit is 60m².
Here is Michelle taking the kids to have a look at our unit in the builder's yard.
What is an Ancillary Residential Unit?
A self-contained residential unit is held in common ownership with the primary activity on the site.
To be self-contained the ancillary residential unit must have a kitchen, bathroom, bedroom(s), living room and laundry facilities. The ancillary residential unit can be attached to the principal building or be a detached stand-alone structure.
Ancillary residential units can be constructed without a resource consent within the Hamilton City General Residential Zone where the net site area is 600m² or more and where relevant development standards are compiled with. Net site area refers to the area of the site excluding any entrance strip, internal vehicle access or private way.
The maximum gross floor area for an ancillary residential unit is 60m².
Here is Michelle taking the kids to have a look at our unit in the builder's yard.
What are Development Standards?
Development standards address matters such as building setbacks, site coverage and outdoor living areas.
There are many development standards which require consideration within the Hamilton City General Residential Zone.
In some cases, there are specific development standards which apply due to unique features of individual sites. Some of the typical standards which relate to ancillary residential units are:
Total site coverage - maximum 40%.
Permeable surface - minimum 50% (within the front yard) and minimum 30% (across the entire site).
Maximum building height - 10m.
Height in relation to boundary - any building is required to fit within a recession plane measured from 3m vertically above the ground level at the boundaries of the site and at an angle of either 28 degrees (for boundaries between northwest and northeast) or 45 degrees (in all other directions) into the site.
Building setbacks -
- Transport boundary (local and collector road) – 3m
- Transport boundary (arterial road) – 5m
- Other boundaries - 1.5m
Outdoor living area - minimum of 12m². The area shall have no dimension less than 2.5m. The ancillary outdoor living area shall not be included as part of the principal dwelling outdoor living.
Service areas - 10m² minimum area with a minimum dimension of 1.5m.
Car parking - one car parking space.
What are Development Standards?
Development standards address matters such as building setbacks, site coverage and outdoor living areas.
There are many development standards which require consideration within the Hamilton City General Residential Zone.
In some cases, there are specific development standards which apply due to unique features of individual sites. Some of the typical standards which relate to ancillary residential units are:
Total site coverage - maximum 40%.
Permeable surface - minimum 50% (within the front yard) and minimum 30% (across the entire site).
Maximum building height - 10m.
Height in relation to boundary - any building is required to fit within a recession plane measured from 3m vertically above the ground level at the boundaries of the site and at an angle of either 28 degrees (for boundaries between northwest and northeast) or 45 degrees (in all other directions) into the site.
Building setbacks -
- Transport boundary (local and collector road) – 3m
- Transport boundary (arterial road) – 5m
- Other boundaries - 1.5m
Outdoor living area - minimum of 12m². The area shall have no dimension less than 2.5m. The ancillary outdoor living area shall not be included as part of the principal dwelling outdoor living.
Service areas - 10m² minimum area with a minimum dimension of 1.5m.
Car parking - one car parking space.
Site plan for the Ancillary Unit
The red rectangle is the footprint of the new unit and all aspects of the plan that make the unit comply with the Development Standards are labelled.
Please note - other residential zones may have different rules
There are some residential areas of Hamilton that are recognised as having a distinctive and special character. Special zones are provided for these areas and different rules and policies are applied to protect, maintain, and enhance their special characteristics.
If your property is outside of the Hamilton City Zone then you will need to check with HCC to find out if there are any additional rules, or variations to rules that will apply to you.
Site plan for the Ancillary Unit
The red rectangle is the footprint of the new unit and all aspects of the plan that make the unit comply with the Development Standards are labelled.
Please note - other residential zones may have different rules
There are some residential areas of Hamilton that are recognised as having a distinctive and special character. Special zones are provided for these areas and different rules and policies are applied to protect, maintain, and enhance their special characteristics.
If your property is outside of the Hamilton City Zone then you will need to check with HCC to find out if there are any additional rules, or variations to rules that will apply to you.
The Ancillary Unit that we chose
We got our unit from Units2Go, who we met at Fieldays. They have many options, but we chose the Designer Series 12m x 3.8m.
That unit was about as big as we could go and still have it fit and abide by all HCC rules. At the same time, we were happy that the size was livable, and we felt the design looked a lot nicer than some of the boxy units that were available elsewhere.
The unit was built undercover in the Unit2Go yard in Papakura and we dropped in to have a look mid-way through the 8 week build.
The Ancillary Unit that we chose
We got our unit from Units2Go, who we met at Fieldays. They have many options, but we chose the Designer Series 12m x 3.8m.
That unit was about as big as we could go and still have it fit and abide by all HCC rules. At the same time, we were happy that the size was livable, and we felt the design looked a lot nicer than some of the boxy units that were available elsewhere.
The unit was built undercover in the Unit2Go yard in Papakura and we dropped in to have a look mid-way through the 8 week build.
How much did everything cost?
How much did everything cost?
How much does the unit rent out for, and what is the yield like?
The unit rents for $420/week and cost $180k, so that’s a gross yield of 12.1%.
How much does the unit rent out for, and what is the yield like?
The unit rents for $420/week and cost $180k, so that’s a gross yield of 12.1%.
What’s the annual profit and yield on this unit, after all costs?
Annually this unit makes $4,950 profit which implies a net yield of 2.7%. With borrowing costs at 6% and a 100% loan, this project is still cash flow positive.
What’s the annual profit and yield on this unit, after all costs?
Annually this unit makes $4,950 profit which implies a net yield of 2.7%. With borrowing costs at 6% and a 100% loan, this project is still cash flow positive.
Want to know more about this project or discuss possible development options for your investment property?
We’re happy to help!
Reach out to Olly via the button below or drop into the Waikato Real Estate office at 757 Te Rapa Rd, Hamilton.
Want to know more about this project or discuss possible development options for your investment property?
We’re happy to help!
Reach out to Olly via the button below or drop into the Waikato Real Estate office at 757 Te Rapa Rd, Hamilton.