QLD Low Height rooms - Impact on Property Value

Discussion in 'Property Analysis' started by SimCoe, 15th May, 2022.

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  1. SimCoe

    SimCoe New Member

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    Brisbane
    We are considering making an offer on a property in Brisbane. It is a 1920’s queenslander style cottage, inner city area, great location but can only be advertised as a 2 bedroom house due to the built-in downstairs areas only being 2.1m height. There are a couple of rooms and a rumpus/living type space that are all very live-able (and are correctly shown as ‘utility rooms’ rather than bedrooms), but we can’t quite decide on what impact that would have on the property value, if any. It is a fantastic location in a very sought after area, so we suspect most potential buyers won’t care.
    It is going to auction but sellers are open to accepting offers prior. Any advice would be appreciated!
     
    SimCoe, 15th May, 2022
    #1
  2. wylie

    wylie Moderator Staff Member

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    Legal height is a big (legal) thing. You will be buying a two bedroom house and one day will sell a two bedroom house. Nothing will stop people sleeping in bedrooms or using living rooms that are "almost" legal height, but it does pull back the value for purchase and eventual sale.

    I would think you need to compare it to two bedroom houses (but it might sell at a comparable price to three bedroom houses with second living area) in this market.

    Seems nonsensical, but that is the way it is unfortunately.
     
    wylie, 15th May, 2022
    #2
    Marg4000 likes this.
  3. Marg4000

    Marg4000 Well-Known Member

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    It can only ever be advertised, sold or rented as a two bedroom house.

    2.1m ceilings are very low - our son is 2m tall.

    Value will be at the top end of 2 bed houses due to the extra rooms underneath.
     
    Marg4000, 16th May, 2022
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  4. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    What is the workmanship if its a unapproved change ? What impacts for insurance ?
    Also illegal works if detected in the future may be your liability to rectify and return to approved use. You inherit the potential for prosecution.

    The BCA rules are that of haibitable v non-habitable. Average heights must be 2.4/2.1 respectively. A bedroom also must have natural light / window.
     
    Paul@PAS, 16th May, 2022
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  5. segue

    segue Member

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    On a mortgage valuer perspective, if this living area is unapproved by council or the ceiling height is not in line with BCA requirment as Paul said above, they will have to disregard this part of living area when valuing, which may lead to some mortgage issues. I would ask the agent to provide proof, request a building inspection of the property and double check with local council afterwards.
     
    segue, 3rd Jun, 2022
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  6. 38610

    38610 Well-Known Member

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    We see this a lot with all the highest homes built throughout Brisbane. 3 bedrooms upstairs and a couple utility/rumpus rooms downstairs that are used as bedrooms. The house will only ever be a 3 bedroom home and the price does reflect that. Being not legal height is a big thing and will impact future resale as the home would be worth a lot more if it was lifted and became a legal 5-bedroom home for example. However, with the extra internal space, we do see highset homes achieve a higher rent return than a 3 bed single storey home.
     
    38610, 11th Aug, 2022
    #6