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Published April 2, 2024

What Is A Dual Key Apartment?

Property investors often use dual key apartments to receive double the rental income from one property.

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A dual-key apartment is one property divided into two self-contained dwellings. The dwellings are then rented out to two separate tenants, while ownership remains under one title.

» MORE: Renting vs buying in Australia: Which is best for you?

How does a dual key apartment work?

A property owner with a freehold property title (or the right strata approval) can divide an existing property into two smaller dwellings. For example, a house could be turned into two apartments. Or, a large apartment could be turned into two smaller ones. 

This allows the owner to generate two incomes, as both dwellings pay rent individually. In theory, having two individual renters could generate more income than one, larger apartment. 

Each individual apartment will typically have its own kitchen and bathroom. Both apartments will also have separate entrances with lockable doors, although these doors may be side by side. Living spaces are separate, but dual key apartments may share other facilities such as parking spaces or laundry areas. 

A dual key apartment might have more affordable rent than a traditional apartment, as it is typically much smaller. However, it’s important to understand what is shared and what is separate before moving in. 

You may also want to consider who occupies the other unit. It’s possible for the owner to live in one of the apartments whilst renting out the other. This will depend on personal preference, but some renters may prefer to not have the landlord living next door. 

» MORE: What is rentvesting? 

Benefits for property investors

Potential for two incomes

The goal for dual key apartment owners is to rent out both dwellings and receive more income than they would otherwise be getting from the original property. For example, a hypothetical two-bedroom, two-bath house in the suburbs could be rented out for $600 per week. 

After dividing the house and renovating it, two separate one-bedroom apartments could be rented out for $400 a week each. In this case, the owner would now generate $800 per week from the two individually rented units. 

Only one property title

A dual key apartment will typically save money on council fees compared to simply buying a second property as an investment. When you own a property, you are required to pay tax or fees to your state government. When you own a dual key apartment, both dwellings are owned under one title, which means you only pay one set of fees. 

Live in one dwelling

Another option for owners of dual key apartments is to rent out one of the dwellings while living in the other. In this scenario, the rent from one dwelling could help cover the costs of your mortgage repayments without needing a roommate. 

Risks for property investors

Difficult to resell

Data shows that approximately 70% of the Australian property market is owned by owner-occupiers. Dual key apartments are more typically owned by property investors, so it may therefore be more difficult to resell in the future to the majority of people in the market

Of course, the location, quality of the property and market conditions will also affect your ability to resell. However, this potential difficulty is important to keep in mind when you purchase. 

Strict lending rules

Dual key apartments are a unique property type that depends largely on generating two rental incomes, so lenders may have stricter requirements for loans on these types of properties. This will depend on many factors specific to the property and the lender, but is another risk for potential investors. 

» MORE: Types of home loans in Australia

Has to be sold as one property

Dual key apartments are owned under one title so they can only be sold under one title, meaning you can’t sell one of the dwellings individually. 

Considerations for tenants 

For future tenants of a dual key apartment, there are a few factors to consider. 

Smaller property size

Dual key apartments are the result of a property being split in two so the layout may be smaller or strangely designed compared with regular apartments. 

Dual key dwellings might be studios with a kitchenette rather than a fully equipped kitchen. This will vary depending on the property, but you may be able to get more bang for your buck in a regular apartment or flat. 

» MORE: When can you renovate an apartment? 

Shared facilities

If you are looking to rent a dual key apartment, you may have to share the entranceways, parking or even storage areas with your neighbour. Make sure you understand what is and isn’t included in your rent before moving in. 

Living next to your landlord

In some cases, the owner may live in one dwelling and rent out the other. This could lead to a lack of privacy, depending on the owner, but will need to be factored into your decision before moving in. 


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