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Thinking of building a granny flat? here's what you need to consider

25th May '17 • By Emily Ayers

With property prices soaring high, granny flats have become a rising trend all over Australia. Whether you want to extend your primary living quarters or create a rental lodge, or simply build a separate living space for a relative, granny flats are the way to go.

Granny Flat

If you are planning to build a granny flat and are unsure about the requirements, read on as we’ve summed up all the things you need to consider on how to build yourself a granny flat with ease.


There are a few state specific regulations laid down by local council that needs to be considered before building a granny flat. They include:

  • There may be size limitations
  • Local council permission will need to be sought
  • One granny flat per block
  • May be standalone structure or attached to your principal home
  • Must adhere to the Building Code of Australia

Since regulations may be state specific, it is best to contact your local council for information related to your specific state



Once all the aforementioned regulations are looked into and out of the way, it is time to set a budget. It is always wise to decide set a budget beforehand for any large project. Proper planning and budgeting ensures that everything goes smoothly. If you’re not sure how to set a budget, we’ve created a complete guide here.


There are many options to consider when building a granny flat and the costs greatly vary from $10k to $120k. Depending on which method you opt for, your costs will be as follows:

  • A pre-fabricated or shipping container granny flat design at 15 squares meters in size can cost as little as $10k to build. However, make sure you ask about plumbing, electrical and foundation slab costs as this may not be included in the overall cost.
  • For a larger, 60 square meter granny flat kit, you’re looking at a cost of around $60k to $70k. 
  • For a new custom build, usually with its own laundry and kitchen you should expect a cost of around $120k.

The budget and construction type will depend heavily on what you want to build the granny flat for. 


Council Permission

Local council approval is absolutely necessary. Every council has their own planning policies and you need to be aware of them before taking on any construction project. Getting permission is usually easy and doesn’t require much time, most builds gain approval within 20 days.



Before hiring a builder to start constructing your granny flat, another factor that needs to be considered is insurance. Whether you’re using it for personal use or renting it out, you must inform your insurance company. It is just as important to get your granny flat insured as it is your primary household. There’s always risk and liability involved and this can increase the insurance costs. 

Need help finding a builder to install your new granny flat? Get up to 3 free builder quotes from local Builders today.

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