Why more investors are turning to Duplex properties

21 Oct

Across Australia, duplex homes have become one of the most compelling investment options for buyers seeking a balance of strong income, flexibility, and future capital growth.

From families looking to create multi-generational living arrangements, to private investors seeking resilient rental income - the appeal of duplexes lies in their versatility and performance potential.

Case in point: A recent Duplex acquisition

We recently advised a client on the purchase of a new build detached duplex property for $979,000 (house and land). Each side offers high-quality finishes, separate entrances, and a modern design suited to the local rental market - 4 bedrooms, 2.5 bathrooms, garage, for each unit.

Key Performance Indicators

Rental return: $1,200–$1,300 per week
Gross yield: approximately 6.3%–6.9%
Sales appraisal: $1.45M–$1.57M (combined)

Even allowing for minor strata costs (typically around $20,000 - $30,000) to separately title each dwelling - services are already split - the implied capital uplift is significant. This creates both short-term equity and long-term flexibility, should the owner ever wish to sell one or both dwellings.

Based on the purchase structure and adopting conservative long-term growth assumptions of just 4% per annum (vs suburb data being at 9.1% pa average growth over 10 year average), the 10-year internal rate of return (IRR) would exceed 20% p.a. for this client’s specific circumstances - equating to over $1,000,000 in gains over the decade.
This scenario allows for realistic variables such as a 20% cash deposit, 5.5% interest-only lending, applicable tax rates, and standard market outgoings/maintenance.

We don’t provide forecasts - we provide the tools, models, and education that enable clients to understand, test, and make their own informed assumptions.
Our approach is guidance-first, helping investors evaluate the relationship between capital growth, cashflow, and risk - and make decisions based on clear, data- and evidence-led insights.

Key benefits of Duplex investments

1. Strong Cashflow and Yield

Two income streams on a single block deliver above-average rental returns, often outperforming comparable single dwellings in the same suburb.

2. High Depreciation Benefits

As newly built assets, duplexes attract substantial depreciation allowances, improving after-tax cashflow for investors.

3. Risk Diversification

With two tenancies, vacancy risk is reduced - even if one side is vacant, the other typically continues generating income.

4. Brand-New, Low-Maintenance Appeal

Modern construction standards, warranties, and builder guarantees reduce maintenance costs and attract quality tenants.

5. Flexible Use and Future Options

Ideal for families with older children or extended relatives, duplexes provide flexibility to occupy one side and rent the other, or to sell one dwelling later if desired.

6. Easier Management

Even with two tenancies, duplexes are typically easier to manage than separate houses - everything’s in one location, on one title, with shared maintenance.

7. Located in Growth Corridors

Most duplex developments are positioned in high-growth areas, supported by strong population inflows, new infrastructure, and local employment hubs.

Final thoughts

Duplex investments combine cashflow resilience with capital growth potential - making them a strategic choice for investors seeking to balance immediate returns with flexibility for future value realisation.

At Childs Real Estate, we help clients identify the right opportunities across Australia’s growth markets, ensuring the numbers, location, and structure align with each client’s investment strategy.