With Millennials facing the brunt of job losses and loss of opportunity and savings due to COVID-19, many are finding the dream of jumping on the property ladder further and further from their grasp.
But there is a way for Mum and Dad investors to use their spare bedroom to help create a brand new kind of Millennial housing solution with a micro-apartment conversion.
WATCH my interview with Ticker TV’s Adrian Franklin below as I reveal the micro-apartment solution that can get Millennials into their own property sooner!
Adrian (00:00): So with many millennials being caught short each month at the moment due to COVID-induced job losses, they are finding themselves struggling to afford rent and having to return to the family home. Ian Ugarte joins us now to talk about a longer-term solution. Great to have you back on Ticker, Ian. How are you mate?
Ian Ugarte (00:18): Thanks, Andrew. And thanks for having me back and I hope you’re well. I’m well.
Adrian (00:22): Good to have you. Yeah, we’re all well here in Melbourne. As you know things have improved. So the last time we spoke was I think months ago when we were in lockdown, but we’re moving out, so great to have you back. Tell us about what’s going on here? We’ve mentioned in the intro there that obviously millennials we know are struggling, job losses, they’re going home. What are you seeing at the moment? How worrying do you think this trend is?
Ian Ugarte (00:44): Look for them extremely worrying, especially if they’re lost your job during COVID, and when it’s … For them, they’re just looking at ways to be able to save money, be able to get themselves into a better spot and how do they do that? There’s a couple of different options for them.
Adrian (00:58): Yeah, so let’s talk about that. You’ve got an idea of the micro-apartment conversion. We spoke about this last time. So no doubt this is … I think my brother is actually even interested, just thinking about it now. Break it down for us-
Ian Ugarte (01:09): Right.
Adrian (01:09): What is it? Who should be interested?
Ian Ugarte (01:12): Well, let’s look at Mums and Dads, right? Let’s use little Johnny as example. Little Johnny moved out three or four years ago. He’s been out there in the rental market and he’s hit the age of 30 and he’s finding that he’s getting no headway whatsoever. So he just says to mum and dad, “Hey mum, dad, can you just do a partial conversion on your home? Then that way I can move back in and I can start to save some money and consolidate my costs.” And when Johnny moves back in, he’s actually a fully grown adult. He’s developed this way of living on his own and mum and dad have got themselves to a place where they’ve started to walk around the place a little bit naked maybe, and they’re used to their own space.
Ian Ugarte (01:50): So by doing a partial micro-apartment conversion, what they can do is Johnny’s old bedroom and the spare bedroom becomes the kitchenette. Johnny has his own bathroom and his own living area. And then mum and dad have their space that they can live in. And then in the middle, there’s a respected place where there’s rules and regulations about what you can do and can’t do as far as Mum and Dad, because Johnny doesn’t want to see them nude. And Johnny can also have his partners and friends over. Now, what that means is a much better outcome from a savings perspective for Johnny.
Adrian (02:20): So can the house be converted back just as easily, or should the young people just stay at home forever?
Ian Ugarte (02:28): When they’ve got their own space, why are they ever going to move out of mum and dad’s place, right? But mum and dad are eventually going to say, “Hey, Johnny, you’ve been here for three to five years. You’ve saved a good deposit. We’d like you to get out of the place right now.” And then that way they have the choice of adapting their house back if they want to, and having their space again, or they can then have another child of theirs come in and help them out so that they can get it on their feet. Maybe they’ve got a family or relative that going in and especially grandma and grandpa, that may be getting into the point where they need a little bit of care. They can use it, but to adapt it back is as quick as it was to move it forward. Within a week you could go back to a standard everyday home again, and everything’s going to be rosy.
SCROLL DOWN TO FIND OUT HOW MUCH IT COSTS TO CONVERT A MICRO-APARTMENT!
Adrian (03:14): Let’s talk about the costs. And also, are there any special approvals that people need to carry out this type of conversion?
Ian Ugarte (03:21): Yeah. Yeah. For as little as 20,000 upward you can actually convert the partial house into a micro-apartment setup. You do require, and it’s absolute that you do get approval to do it. You can do that through a private certifier in less than 10 days in most areas of Australia. And the certifier will sign off on behalf of council. And you do want to do with this with compliance because what’s at risk right now is lives when this setup happens and saving lives is important. So we want to make sure we do it with compliance.
Adrian (03:54): And do you see this as being a solution for millennials who live in their own property as well, but due to COVID, they’re perhaps looking for more ways to help service their debt and just build their wealth in some ways?
Ian Ugarte (04:06): Yeah. And we’ve seen that during COVID with the first home buyers that are living in their home and been affected by job loss or lesser amount of work. They’ve struggled to pay bills. And we’ve seen a couple of these come through where they’ve converted their micro-apartment and they’ve ended up and to be able to … it’s the triple whammy. They’ve been able to get back on top of all the bills and kept the home that they live in. They have now put it themselves in the place to reduce their mortgage costs, reduce their outgoings, and now to pay off their mortgage quicker and almost close to living at home for free. But more importantly, what it’s done is it’s created a micro-apartment setup that has created affordable accommodation outcomes for other people that have been affected by COVID, or just want to save themselves two thirds of their weekly rent by moving into one of these micro-apartments. And this is a win across the board for everyone.
Adrian (05:00): Yeah, no, I completely agree. I think it is something we need to look at in to the future. Mate, where can we jump online to find out more?
Adrian (05:17): Great stuff. Great to have you on Ticker again. We’ll talk soon, Ian.
Ian Ugarte (05:22): Thanks, Adrian.
WANT TO KNOW MORE? Join my free Positive Cash Flow Webinar to find out how you can legally and with full council compliance, convert your spare room, or entire home into micro-apartments that earn 2-3 x typical residential rental returns HERE.