Denise, a 60-year-old woman residing in Hobart,Glenorchy, in a new house with a double garage, seeks tocapitalise on the housing crisis by converting her garage into one of the three options: (1) a bedroom; (2) abedroom with ensuite bathroom; (3) a bedroom, ensuite bathroom and kitchenette for UTAS students.Converting a double garage into student accommodation is a significant project, with costs that can varydepending on factors such as the size of the garage, the extent of the renovation, and materials used.There are also several accounting implications that must be considered, such as financing the conversion,determining what rent to charge, and ensuring that the conversion meets all building and safetyregulations. Denise consulted with professionals and based on her plan, here is a detailed breakdown ofthe estimated costs she might incur: Initial Consultation and Design that cost anywhere from $500 to $3,000, depending on the extent of the project. Structural Alterations: converting the garage into a living space will require extensive structural alterations, such as installing walls, insulation, and electrical and plumbing systems. The cost of these can vary significantly, based on the specific requirements of the project, but typically range from $20,000 to$50,000.Windows and Doors: windows and doors must be installed to meet building codes and create a comfortable living space. The cost of windows and doors can vary, depending on size and quality, but typically ranges from $3,000 to $10,000.Flooring: Denise will need to install a new flooring system to make the garage a liveable space. The cost of this can vary based on the type of flooring she chooses, but typically ranges from $5,000 to $10,000.Kitchen and Bathroom: If she plans to include a kitchen and bathroom, the cost can increase significantly. Kitchen appliances, cabinets, and countertops can cost between $10,000 and $20,000, while a basic bathroom installation can range from $5,000 to $10,000.Permits and Fees: Depending on her location, Denise may need to obtain permits from local authorities, which can cost at least $1,000.A separate electrical panel:The estimated cost to install a separate electrical panel for converting a double garage into living space is typically around $800 to $2,500.Insulation:The cost of adding insulation ranges from $1,400 to $4,000.She currently has $25,000 in her bank account and is open to obtaining a bank loan if necessary.

What government grants or financial support might be available to help fund the project, and how can these be accessed? And does that available regardless the type of the rental?

What is the total cost of the garage conversion project, including any costs associated with obtaining a council permit based on the three options: (1) a bedroom; (2) a bedroom with ensuite bathroom; (3) a bedroom, ensuite bathroom and kitchenette.?

Will Denise need to borrow money from the bank, and if so, how much? What is the current interest rate on a loan for home improvements?

Is there a specific annual cost associated with running the accommodation, which Denise needs to consider?

How much rent could she charge for this type of accommodation, in the current market, and what is her potential income from the accommodation?

What is the break-even point for the projects?

What is the payback period for the garage conversion projects?

Assuming Denise has expressed her desire to recover the conversion costs within three years, what is the minimum rent she needs to charge her tenants to accomplish this goal? Is it feasible to achieve this target in the current, competitive, rental environment?

What is the net present value (NPV) of the projects?