Ever considered a granny flat?

Granny flats are a popular way to create income on your property or to give a loved one a private residence. Granny flats aren’t just for “grannies.” You can rent a granny flat to whomever you like or even use it as a private getaway or home office. What do you need to do to build a granny flat and how much is it going to cost?
Granny flats are a popular way to create income on your property or to give a loved one a private residence. Granny flats aren’t just for “grannies.” You can rent a granny flat to whom

Building a granny flat

Most councils allow granny flats, but it may depend on the area you live in and the size of the land. Check with your local council first and if you get the go-ahead, be aware you will have council fees to pay and the council will want detailed drawings of the granny flat before they will approve it.


When you apply to council be aware that:


  • A few councils may charge up to $20,000 for a “contribution fee.” This is uncommon but could tip the scales against the building.
  • You may need to lodge a Development Approval (DA) application.
  • In Victoria, only a person dependant on the occupier of the main house can live in a granny flat.
  • All granny flats must comply with Australian building standards.
  • Granny flats must have everything needed for independent living, including bathrooms, kitchens and private access.
  • Only one granny flat is allowed on a single residential property. The home on the property must also be a primary residence.
  • The granny flat must have a private entrance and an outdoor space.

With the exception of Victoria, you can use a granny flat for any purpose. If you live in a tourist area, it can even be used for rental purposes to tourists.

Getting Approval to Build a Granny Flat goes into more detail about what you need to do to get council approval.  

Choosing a granny flat

Granny flats can be:

  • Custom built
  • Kits are available
  • Flat pack granny flats are available

Builders of granny flats can ship a granny flat to any location. If you buy a kit granny flat, it may arrive fully built, but you may still need to lay a foundation and attach water and electricity, though some kit granny flat builders include these in their prices. A flat pack granny flat will come with everything, but will have to be constructed and will need a foundation, water and electricity.

Think about the type of granny flat you want. Kits and flatpack granny flats come in a variety of styles, but would a custom built granny flat be better for you? If you own a more expensive property, a custom built granny flat may be a better investment. Any granny flat can add to the value of a property, but don’t skimp on the price. Granny flats have been offered for as little as $10,000, but they may not enhance the appearance of your property.


A granny flat can be anything you want it to be. For some brainstorming ideas, read Unique Granny Flat Ideas and have a look at our Granny Flat Ideas photo pages.


How much does a granny flat cost?*

Granny flats are not inexpensive but can be less expensive than a home extension. They can also offer a good return on investment and can add more than their value to a home.

If you want a custom built granny flat, get quotes from granny flat builders. Compare the quotes carefully because some will include a slab, plumbing and electricity in their quotes. Granny flat kit homes can be less expensive and are often just as good as a custom built granny flat.


Some kit home builders include a slab, plumbing and electricity in their quotes. They may stipulate a distance for plumbing and electricity and add a price for a further distance. For example, they might give 10 metres free and add $150-$160 per metre beyond that. Some prices you can expect to pay for a kit granny flat with a slab, plumbing and electricity might be:


  • $81,000 for a 38m2 granny flat
  • $95,000 for a 50m2 granny flat
  • $120,000 for a 71m2 granny flat

The slab price may include excavation up to 400mm of cut and 400mm of fill. Different kit builders will have different prices and inclusions. Compare their quotes carefully. Some things that may be included in the price include:

  • Up to 10 power points and one external power point
  • Enclosed shower and all bathroom fittings
  • Full kitchen with laminate benchtops
  • Laundry tub and splashback
  • Carpeted bedroom and flooring in other rooms
  • Energy efficient lighting fixtures

Standard cladding may not be to your liking, but many kit home suppliers can provide other types of cladding at an additional price. Some prices you may expect to pay for custom cladding can be:

  • Fibre cement sheeting, sealed and painted for $2800
  • Painted timber weatherboard cladding for $4,500
  • Brick veneer for $8,400

Other options are available, too. They come at a higher cost but may be worth the extra cost. For example, the standard granny flat will have 2.4 metre high walls. Many kit builders will make 2.6 to 2.7 metre high walls at an extra cost. Flooring, the kitchen benchtop and other extras are available, too.


Any kit home supplier/installer you get quotes from should provide a full list of inclusions and extra charges for upgrading the granny flat or for plumbing connections beyond a certain distance. Compare their inclusions carefully because if one gives you a cheaper quote, it may not include items you need for the granny flat. If you have to hire someone to add to the granny flat, it could end up costing more than a more expensive kit granny flat with more inclusions.


Granny flats are not just for grannies

As mentioned above, granny flats are not just for grannies. In most states except Victoria, you can rent a granny flat out to anyone or you may want a home extension without the high price tag of a typical home extension. For example, you might want a backyard studio complete with a bathroom and kitchen. Use the studio for anything you like or just have it as a private retreat.

Many people today work from home. A granny flat can give the privacy needed for working from home and allow you to see clients in a private area. Instead of having a living room, use the living room as an office with a desk and internet connection. Use the kitchen for making tea or coffee and have a bathroom nearby so you or your clients don’t need to walk to the house.




A granny flat can be an ideal home extension, especially if you want a detached structure that allows you to work or relax away from the home. A typical home extension will cost more than a modest granny flat and will disrupt your life while the building is in progress. A granny flat is detached from the home and building won’t disrupt your life. When it’s completed, you will have a beautiful place to rent or use for whatever purpose you want it for.

*Costs and prices in this article are indicative and should only be used as a guide. They also vary locally and are subject to market forces.