Granny Flats Prices & Section 94 Contributions – Highway Robbery?

Granny Flat Approval Pricing and Section-94 Contributions- What Are They and which Councils Charge these fees.

At Granny Flats Sydney, we are constantly on the lookout for ways to save our clients time and money. Today we’re talking about a sinister fee charged by some Councils in NSW, called Section 94 Contributions (or S94 Levies) Levy. These fees are purportedly charged by Councils to cover for additional load on the infrastructure when a developer builds a new dwelling. Granny flats are considered ‘dwellings’ and as such are on some Council’s radar as a way to make more money. One Council we know of has a dedicated ‘Section 94 Contributions Officer’ who’s sole purpose is to monitor Certifier Granny Flat Approvals and see where she can impose this inane fee.

We thought we’d better name and shame the few Councils still charging these fees in NSW. We feel quite strongly that granny flats in Sydney and Country NSW should not be charged these fees at all. Most Councils don’t charge them and some only charge the fee if the ‘Cost of Works’ is over $100,000, so that’s good since most granny flats don’t cost over $100,00. Unfortunately for some clients, they must pay these fees before approval can be granted by the Private Certifier. They are literally held to ransom.

It’s heartbreaking for us too in having to inform a client of these fees, since its just money gone to waste- hardly what you’d call ‘Affordable Housing’ is it? The NSW Department of Planning hate these fees as much as we do but they’re powerless to do anything about them. When a client asks me about these fees with respect to their entire building budget, I tell them the truth- that this money is taken by Council and there’s nothing they can do about it. I give them the analogy of walking into their bathroom with a wad of cash and flushing it down the toilet!

A few State Politicians have even tried to argue them out of existence in parliament (the Reverend Fred Nile is one) only to find that Councils are totally immune to being challenged on the implementation of these (ridiculous) fees.

So without further ado, lets list some of the currently known Councils who charge Section 94 Contributions

SYDNEY COUNCILS

1. Blacktown- 1 bedroom is about $3,500 and 2 bedrooms they charge about $4,500

2. Ryde- They charge around $7,000 for a granny flat

3. Auburn – They charge around $8,000

4. City of Sydney – It has ranged there recently (Councils have the right to change their fee without public notice as well!) but at last checking it was around $12,000.

5. Hornsby – They currently charge around $18,000 as of September 2013. This is the highest that we know of at the moment.

RURAL COUNCILS

6. Cessnock- Around $4,000 for 1 bedroom and around $6,000 for 2 bedrooms

7. Lake Macquarie- Around $4,000

There are a few more, but as stated above, Councils shift and change their position on the imposition of granny flat section 94 contributions ,so it’s very hard to keep up. Their policies are not a quick read either, so its hard to keep track. When you speak to a Council Officer, you’ll often get the wrong info as well.

Finally we ask that if you have recently been informed of any changes or know the price in your own Local Council area, please feel free to let us know by phone or you can post it here and we’ll make it public. I have a very long thread article on an investment forum which keeps track of these fees and people do add them for each Council as they’re made known. You can see the list HERE.

section 94 contribution levies

section 94 contribution levies

 

I hope this post has highlighted what is arguably the most horrendous aspect of what the state Government terms ‘Affordable Housing’ in NSW. We hope that something is done (soon) to abolish these ridiculous fees. We encourage everyone to make contact with your local member and make your complaint known- we know we have several times.

Warm Regards,

Serge Panayi- Granny Flats Sydney (NSW) Pty. Ltd.

www.grannyflatapprovals.com.au

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Comments

28 replies on Granny Flats Prices & Section 94 Contributions – Highway Robbery?

  • Ahmed Hammoud says:
    November 8, 2013 at 11:36 pm

    Holroyd city council charges $3300; for the pathetic fee

  • Karen says:
    January 15, 2014 at 10:25 am

    $10k for 2 bdm granny flat conversion of existing free standing shed in Lake Macquarie.

    • Serge Panayi says:
      January 15, 2014 at 10:47 am

      Hi Karen,

      Have you already applied for the Conversion Approval? If not, give me a call- we may have a way of avoiding this ridiculous Council fee in some cases (for conversions).
      Serge.

  • Dante says:
    February 24, 2014 at 11:33 pm

    A pre existing granny flat built detached to the principal residence both built over 50 years ago, but no building approval records are found by Canterbury Council and they are reluctant to approve retrospectively.
    What can I do apart that Sydney Water provided sewer diagram showing all plumbing connections of both the house and granny flat. Please provide insights to resolve this problem.
    Much appreciated.

    • Serge Panayi says:
      February 25, 2014 at 12:31 am

      Hi Dante,

      You should be able to get an approval for the conversion since the structure was approved by Council as some kind of shed or other structure. The fact that it’s shown on a Sydney Water plan means it ws approved at some point in time. If you can email me the Sydney Water Sewer Diagram, I can get you an approval.
      You’ll just need to provide me with:
      1. The Section-10.7 Certificate from Canterbury Council. These can be purchased for $53 OR if you have purchased the property recently, it will be in the Contract of Sale.
      2. The Sydney Water SSD (Sewer Service Diagram) showing that the structure is there on their records.

      Please read our garage and shed conversion guides so that you understand that all conversions require some minimum Building Code and SEPP requirements to be met prior to occupation. Some of these are:
      – Minimum wall heights in bedrooms & living areas (2.4 metres), 2.1m in hallways, kitchen and bathroom.
      – BASIX (energy efficiency) requirements must be installed (Energy Efficient Hot Water, minimum insulation and tap star ratings etc.)
      – Waterproofing Certificate to be done. The wet areas are tested for water proofing and a Certificate issued.
      – Termite Certificate for adequate termite protection.

      Please have a read of our helpful Granny Flat Conversion Guides: https://www.grannyflatapprovals.com.au/garage-conversion-guides. This is a worthwhile read.

      Remember, we 100% Money-Back Guarantee our approvals, so give us a call and we’ll look closely at what we can do for you.
      Conversion Approval Pricing is here: https://www.grannyflatapprovals.com.au/garage-conversions

      Regards,
      Serge Panayi – Founder.

      • Gordon says:
        December 8, 2014 at 9:22 am

        I am going to buy a property in Blacktown which pre-existing granny flat is as big as 80 sqm. It has a Sydney Water Sewer Diagram. Just wonder if you could get it approved and how much you will charge for the service fee. Thanks.

  • The Uncle says:
    May 7, 2014 at 1:43 pm

    G’day,
    Highway robbery? More like extortion or demanding money with menaces. In the case of Hornsby Council, the fee is still $18,000; however, I understand that a proposal will go before council at the next meeting that this be reduced. (To the far more affordable level of $9,000!)

    I was happily planning a “granny” for my son, with most problems being overcome, until I spoke to council and ran into a potential rear setback difficulty (fixable – perhaps) and then the double whammy of this $18,000 ransom demand. Even if this is reduced in the future, firstly, I can’t afford it and secondly, I don’t deal with terrorists, blackmailers and extortionists – it only encourages them. The whole project has been dropped. The economy will now suffer because the goods and services I would have purchased will no longer be required.

    Want to get the state and federal economies moving again? Burn all red tape and jail the officials and pollies responsible. Bitter? Annoyed? You betcha!

    • Serge Panayi says:
      May 8, 2014 at 12:15 pm

      Hi Tom,

      I’m sorry and totally agree. If it’s Hornsby Shire Council you were dealing with, they have since reduced their fee to around $9,000 at last look in.

      Serge.

  • Stephen Walker says:
    July 16, 2014 at 12:03 pm

    I have a small fee from Taree council but Mid Cost Water has charged me $12,357.00 for water & sewerage for using exsesting water & sewerage serivices. as per Section 64 & 68 of the Local Goverment Act 1993.

    • Serge Panayi says:
      July 16, 2014 at 1:35 pm

      Hi Stephen,

      I totally sympathise with this. A few rural/country Councils try and charge water and other infrastructure levies on, for example, vacant land. I’m quite surprised they’re trying to do this on an established site since your granny flat is ancillary (or subservient) to the main dwelling. I mean, it’s not a new dwelling house exactly so they are really not entitled to charge this fee in your case. I’d fight this fee and/or refuse to pay it and lobby your Local Member with the argument that the granny flat is not placing excessive load on their system.

      Just ridiculous. Highway Robbery!

      Serge Panayi

  • Xan says:
    February 23, 2015 at 10:14 pm

    Hi, Canada Bay council say they charge $20,000 in S94 fees for a 3bdrm granny flat. Is there anything that can be done to reduce this, or put pressure on their councillors to reconsider S94 fees for granny flats

    • Serge Panayi says:
      February 24, 2015 at 1:29 am

      Hi Xan,

      $20,000 is a new record I think and (in my view) unscrupulous. Your options are:

      1. Refuse to pay the fee unless Council can substantiate how the granny flat incurs such high fees to the local infrastructure etc
      2. Take it up with your local government member, mentioning that other Council’s charge $10,000 at most.
      3. Reduce the design to 2 bedrooms (assuming they charge more for the 3rd bedroom)?

      I have spoken to some legal practitioners who have mentioned that these fees are ‘somewhat difficult to enforce at-law’. Perhaps get some legal advice and let us know how you go.
      $20,000 Council Levies for a granny flat?? Shame on you Canada Bay, Shame.

      Serge Panayi

  • Frank says:
    March 10, 2015 at 6:54 pm

    Currently in the process of getting my CDC for a extension with granny flat attached to main dwelling.
    Went to Canada Bay council to pay the contributions and got the shocker amount of $14040.61 for a two bedroom granny flat.

    Apprently if you are adding rooms to your house (extending) you are charged at 1% of the cost however if you are building a granny flat. You will need to pay 14K for 2 bed room and anything more is 20K.

    Just wondering will i be able to get away with saying this is only for an extension. Is there anyway the council will know seeing that im using a private certifier?

    Cheers

    • Serge Panayi says:
      March 10, 2015 at 11:03 pm

      Hi Frank,

      Even if you could convince Canada bay Council that it’s now extension work (even though your Certifier approved it as a Granny Flat), you’d have to remove the Kitchen and you’d lose the essential ‘value’ added with having a secondary dwelling. I totally sympothise with you here Frank 🙁
      I imagine you also have a fire-rated-wall which shows it’s a separate dwelling. I HATE these fees and I feel they’re a money-grab from some Councils. Remember that some Council’s charge $0. How can this be I ask!

      Serge Panayi

  • Adita says:
    March 21, 2017 at 1:07 pm

    I contacted Camden council yesterday. They told me that if I build a two bedroom granny flat in the north side of Leppington they would charge me $26,100. if my land was on the other side of Leppington it could go up to over $40k
    if I build a one bedroom I would not be charged.
    its more than the stamp duty I would pay for buying the land.!
    I just want the granny flat for my kids and maybe in the future for my parents.
    its highway robbery.

    • Serge Panayi says:
      March 25, 2017 at 10:19 am

      Hi Adita,

      You’re talking about Section-94 eveloper Fees. A farce if you ask me since Granny Flats are provisioned under the ‘Affordable Rental Housing SEPP”. I’ve written an article about this fee and how Council’s are ignoring The Minister’s recommendation that they NOT charge developer fees on granny flats. Even Owner-Occupiers have to pay it. Ludicrous money grab? See https://www.grannyflatapprovals.com.au/granny-flats-section-94-contributions/

      Perhaps the only way to reduce your fee is to ‘designate’ one of the ‘rooms’ as either a Study or Living/Dining Room. This should reduce the fee to the lower one at least.
      In the meantime, complain to your Local Member as many of my previous clients have done and had some success with reduction in the fee.
      I feel your pain!

      Regards, Serge

      • Matthew says:
        August 30, 2017 at 2:46 pm

        And once the Occupation Certificate is issued, can you put a wall and door to the study and not asked to remove it by the council if someone dobs you in?

  • Mylene says:
    April 12, 2017 at 11:23 pm

    updated one? http://www.blacktown.nsw.gov.au/files/e6b35ba4-5cdd-401e-8818-a59b00b345f6/Granny_Flats_for_CP1.pdf

    • Serge Panayi says:
      April 13, 2017 at 5:15 pm

      Hi Mylene,

      Thanks so much for linking the current Section-94 Contributions for Blacktown City Council.
      We have ways to reduce this fee through smart design if that makes sense, but thank you very much for this.

      Regards,
      Serge Panayi.

  • lloyd says:
    July 29, 2017 at 4:40 am

    Wyong council charges around $10,000 in S94’s. I had an argument with a town planner there about this fee. His only argument was totally ridiculous. He said that as I was going to make money out of it the fee is fair. I said if every trade and supplier used in building a granny flat had this same idea and charged ridiculous unsubstantiated fees how much could a granny flat cost to build. I was also charged $5000 for a contribution for the connect of the sewer (with an existing 1 bathroom house).

    • Serge Panayi says:
      July 31, 2017 at 5:33 pm

      Thanks for the heads up Lloyd. You made an articulated argument with Council’s Planner. mADE ME LAUGH A LITTLE TOO.
      I like your thinking and it peeves me off to see Council’s digging into mum and dad investor’s pockets just because they can.
      Its wrong and it’s against the whole point of (us) providing “AFFORDABLE HOUSING’ to support the State Government’s agenda.
      Perhaps petition your Local State MP? Sounds like a pain I know.

      Serge.

  • lloyd says:
    July 29, 2017 at 5:00 am

    Why not design the kitchen so the whole thing is sitting on wheels, and argue that it is not a fixed item therefore the building cannot be considered a Granny Flat.

    • Serge Panayi says:
      July 31, 2017 at 5:36 pm

      lol yea except they’ve plugged that loop hole.
      What your’re describing is a caravan in essence. I dont know what rent you’d get and there’d be no insurance etc.
      Some Councils charge $0 remember.
      Its just outrageous and against development which helps the community in crisis over the rental housing deficit.

  • Jan says:
    September 26, 2017 at 12:50 am

    Shellharbour Council want $17,000 contribution. We bought a house with a granny flat that wasn’t Council approved. We lodged a change of use form & got council approval for the 1 bedroom flat but now they want the $17,000 before we can get an occupancy certificate. Apparently it has been used as a granny flat for four years before we bought the house. We only wanted it approved so my mum could move into it as the house has stairs & she is 87 & having trouble getting up & down them.

  • Sharon says:
    December 8, 2017 at 2:02 pm

    Hello, I have been informed only today I need to pay by Camden council $13781.00 for the fee to get my final certificate.I am utterly disgusted that all councils have some type of fee payable. I did not realize that this amt was payable . I would not of built this type of house if i had known ( House and granny flat).
    I took your advice and I a now writing a letter to my local member. in reference to the excessive fee.

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