Back to Inspire Home

7 things you need to know before building a granny flat

Building a granny flat in your backyard can be a lengthy and stressful process. But it can also be a great investment and serves a number of purposes including extra space for relatives or guests, a playroom for the kids, or it can even be rented out to tenants.

Thinking of renovating your property?

Find a great cash out rate in seconds.

Find a rate now

#1 Getting council approval for a granny flat

approved-stamp Different councils have different requirements for residents wanting to build or renovate on their block of land. Prior to construction of your granny flat, and depending on your living situation, you may need council consent and approval in order to confirm your space is eligible for the changes.

Visit your local council and speak to the building and planning department. Through this, you will be able to obtain a Development Application for the council to approve or reject. Discuss your options with your council, as there are various restrictions and policies to comply with before commencing.

Depending on your council, your granny flat may be approved within just 10 days, although others may take up to 6-8 weeks, depending on the circumstance.

Thinking of building? Read our ultimate guide to construction loans.

#2 Granny flat size restrictions

planning-paper Council requirements will generally include a minimum land size before granting permission. You may think you have a large enough space, however, you need to consider any state or territory regulations of measurement before proceeding. Below is a brief explanation of the minimum and maximum measurement requirements in each state in Australia.

  • Granny flats in New South Wales - The individual's property should be minimum 450 square metres before building a granny flat.

  • Granny flats in Queensland - Granny flats in Queensland can only be a maximum of 80 square metres, although residents will not need to apply for council approval if the extension will be for a member of the family already living on the property.

  • Granny flats in Western Australia - Policies in Western Australia limit granny flat areas to a maximum of 70 square metres.

  • Granny Flats in South Australia - Detached dwellings in South Australia are not allowed to include full kitchen and laundry areas and must stick to 50 square metres of floor area.

  • Granny flats in Victoria - Dwellings or granny flats exceeding 300 square metres generally require an assessment, to ensure the structure is safe and secure, to proceed.

  • Granny flats in Tasmania - Additional dwellings must not exceed a floor area of 60 square metres.

  • Granny flats in the Australian Capital Territory - The maximum gross floor area for a granny flat is 70 square metres, additional parking space is required and the occupant must be providing care to, or receiving care from, a resident of the main dwelling.

  • Granny flats in the Northern Territory - The maximum floor area of granny flats is either 50 square metres or 80 square metres, depending on the type of zone for the property.

How much is your property worth?

Get a valuation for millions of properties across Australia.

Search a property

#3 Granny flat designs

professionals-planning Once you’ve gained approval from your council, the planning stage is an important step in the construction process.

Speak to an architect or project manager to help design your granny flat. Plan and sketch out your ideal design, alongside the expert in charge, considering things like the number of rooms, structure, layout, sizing and measurements. You may even have a rough idea sketched up or in your head, prior to hiring a professional, to speed up the process.

Your architect or project manager can offer advice in the planning stages to ensure the job runs smoothly. Discuss who will be most appropriate for the project and lay out your options in order to stick to your budget.

#4 Renting your granny flat

attic-family

A granny flat can provide a number of benefits. You may use it for extra space, a guest room, a home for a relative, rental purposes or a playroom for the kids. It’s best to consider this prior to building to ensure you know for sure who will benefit most and get the most use out of it. This in turn influences the design of the dwelling.

Many residents tend to build granny flats to boost their property’s value and rent it out to potential tenants. This can work as a great investment and allows for extra cash flow due. Speak to a professional to consider if the rent charged will cover the cost of the build.

Granny flats are also good for extra space for potential guests, like friends or relatives. Some relatives may also occupy the dwelling for a prolonged period of time, such as in-laws or grandparents. In this case, you may need to consider if the structure requires extra railings or ramps for any older individuals who may need them.

Granny flats are great for privacy or entertainment spaces, including toy rooms, man caves or an office for the self-employed.

Thinking of renovating your property?

Find a great cash out rate in seconds.

Find a rate now

#5 Making your granny flat private

fence-lady

Privacy is crucial, especially if you’re going to potentially rent your granny flat out to tenants. You’ll need to know how you will position your granny flat to ensure that those occupying it are comfortable. Allow a decent amount of space or consider some greenery to divide the two dwellings if you can’t install fences.

You should also be aware of access to the granny flat. If your house is quite compact and closed off, consider a side access gate. This also prevents tenants or relatives from disrupting you for access through your own home.

Other elements such as hot water systems and drains need to be carefully planned to prevent any complications or stress later on down the track.

Got your eye on a property down the street?

Find out how much it's worth with our free property report.

Search a property

#6 Pricing your granny flat

couple-sheet Your budget may include a number of things and you’ll need to consider all factors that contribute to the costs prior to building. Calculate a suitable budget with your project manager or another professional. The materials will eventually add up, so keep your design simple to avoid over-spending on unnecessary things.

If you require a loan, take care of this before you commence any construction as it is also a lengthy process. If you are planning to rent out the granny flat, ensure you have enough cash flow for the repayments during the building process while it is unoccupied. Our Home Loan Specialists can help you with this!

You may also want to speak to your project manager or contractor about what tradesmen you will hire. Consider all things, such as plumbing, electrical and carpentry needs.

Research any additional insurance costs you may incur for liability purposes, especially if you are renting it out.

#7 Financing your granny flat

How much equity can you access?

$

Don't know your property value?
Get a free property report

$

Talk to an expert

Got home loan questions? Get free expert advice from our Home Loan Specialists. Call us on 1300 323 181 now.

Tags: granny flat, updating exterior features, construction loan

Check today's low rates

Tell us what you are looking for and see if you can save.

Search rates

Check today's low rates

Tell us what you are looking for and see if you can save.

Search rates
How much is your home worth?

How much is your home worth?

Get a free online property valuation with local sale and suburb statistics.

Get your property report

Important legal stuff

Lendi is the trading name of Lendi Pty Ltd (ACN 611 161 856, Credit Representative 518849), a related body corporate of Auscred Services Pty Ltd (ACN 164 638 171, Australian Credit Licence 442372). We will never sell your email address to any third party or send you nasty spam, promise.
Lendi is a privately owned and operated Aussie business. Our mission is to provide Aussies with the right experience when choosing a home loan from our panel of lenders including ClickLoans, a related body corporate of Auscred Services. Although Lendi compares over 1600 products from over 35 lenders, we don't cover the whole market or compare all features and there may be other features or options available to you. While Lendi is 40% owned by founders and employees, we have also been supported by some great minority shareholders including Bailador, Macquarie Bank Ltd and a number of Australian sophisticated investors. We have an independent and founder led board.
WARNING: This comparison rate is true only for the example given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. The comparison rates are based on a loan amount of $150,000 over a loan term of 25 years.
EXAMPLE: This example is current as at 20th October 2016. A Click Loans Online Principal and Interest Loan of $150,000 over 25 years has monthly repayments of $767. This is calculated based on the interest rate of 3.69%, comparison rate of 3.69%, upfront fees of $0 and annual fees of $0.
IMPORTANT INFORMATION: Loan terms of between 1 Year and 40 Years are available subject to lender and credit criteria. Maximum comparison rate will not exceed 14.99% (see comparison rate warning above). Any calculations or estimated savings do not constitute an offer of credit or a credit quote and are only an estimate of what you may be able to achieve based on the accuracy of the information provided. It doesn't take into account any product features or any applicable fees. Our lending criteria and the basis upon which we assess what you can afford may change at any time without notice. Savings shown are based on user inputted data and a loan term of 30 years. All applications for credit are subject to lender credit approval criteria.
Made with love at Circular Quay in Sydney, Australia. © 2019. All rights reserved.