How Much Does It Cost to Build a Granny Flat in 2024?

If you’ve been tossing around the idea of building a granny flat, you’ve come to the right place. These compact, versatile spaces are becoming increasingly popular, and for good reason. 

But before you go all in, you’re probably wondering about the all-important question: how much is this going to set you back? This guide will break down the expenses involved in constructing a granny flat in 2024. 

What Exactly is a Granny Flat?

Before we start talking dollars and cents, let’s make sure we’re on the same page about what a granny flat actually is.

A granny flat, also known as a secondary dwelling or accessory dwelling unit (ADU), is a self-contained living space that is usually built on the same lot as an existing home. Despite the name, these functional structures aren’t just for grannies! They can serve as:

• Guest accommodations
• Rental Properties
• Home offices
• Teen retreats
• In-law suites
• Airbnb rentals

Still on the fence about granny flats? Our blog on “Top reasons Backyard Granny Flats are a Brilliant Idea” might just convince you to take the plunge

Now that we’ve got that sorted, let’s talk money.

The Average Cost of Building a Granny Flat in 2024

Alright, let’s cut to the chase. In 2024, you can expect to pay anywhere from $80,000 to $200,000 for a granny flat in Australia. Let’s break it down further:

• Basic granny flat (30-40 m²): $80,000 – $120,000
• Mid-range granny flat (40-60 m²): $120,000 – $150,000
• High-end granny flat (60-80 m²): $150,000 – $200,000+

But hold on! Before you start crunching numbers, remember that these are ballpark figures. Your actual costs could be higher or lower depending on your specific circumstances. So, what exactly influences these costs? Let’s get right into it.

Factors That Influence Granny Flat Costs

1. Size of Your Granny Flat Matters

It’s no surprise that the size of your granny flat plays a big role in determining the cost. Generally, the larger the floor area, the more you’ll pay. But it’s not just about square metres. The layout and design complexity can also impact the price.

For example, a simple studio layout will typically cost less than a one-bedroom design with separate living areas. And if you’re dreaming of a two-bedroom granny flat with all the bells and whistles, be prepared for a heftier price tag.

Unsure about what size would work best for you? Our guide on ‘Tips on Deciding the Right Size for Your Backyard Studio‘ can help you make an informed decision.

Whether you are looking for one bedroom granny flat or 2 bedroom 2 bathroom granny flat, we can help. Contact us today for more details.

2. Location, Location, Location

Where you plan to build your granny flat can significantly affect the cost. Here’s why:

• Council regulations: Different local councils have varying requirements for granny flats, which can impact design and construction costs. Some councils may have stricter guidelines on size, setbacks, or design elements, potentially leading to more expensive builds. Always check with your local council or a professional builder to understand specific requirements in your area.
• Site accessibility: If your block is difficult to access, construction costs might increase accordingly. Narrow driveways, limited street parking, or properties on busy roads can make it challenging for builders to bring in materials and equipment. This may result in additional labour costs or the need for specialised machinery, affecting your overall budget.
• Soil conditions: Poor soil quality might require additional foundation work, and this invariably bumps up the price. Soil types like clay, sand, or rock can necessitate different foundation approaches. For instance, reactive soil might require deeper footings or additional reinforcement, while rocky ground could involve costly excavation work.
• Slope of the land: Building on a sloped block often requires more extensive site preparation, which can add to the overall cost. This may involve cut-and-fill work, retaining walls, or specialised foundations. While a sloped block can offer unique design opportunities, it typically requires more complex engineering solutions, impacting both labour and material costs..

3. Materials and Finishes

The materials you choose for your granny flat can make a big difference in the final cost. Here’s a quick rundown:

• Budget-friendly options: Basic brick veneer, weatherboard, or prefab materials
• Mid-range choices: Rendered brick, Colorbond steel, or timber cladding
• High-end selections: Natural stone, architectural panels, or custom-designed features

And don’t forget about internal finishes! Opting for high-end tiles, premium carpets, or fancy tapware will increase your costs compared to more standard options.

4. Design and Layout

The complexity of your granny flat’s design will impact the cost. A simple, open-plan layout will generally be more affordable than a design with multiple rooms and intricate features. Some design elements that can increase costs include:

• Multiple bathrooms
• Custom-built features (like window seats or built-in shelving)
• High ceilings
• Skylights or large windows
• Outdoor living areas or decks

Whether you’re after a home office, sleepout room, or even just have an extra room outside, we can guide you through the entire process, helping you balance your needs with your budget.

RELATED: The Ultimate Guide to Granny Flat Designs: Everything you need to know

5. Site Preparation

Before a single brick is laid, your site needs to be prepared. This can include:

• Clearing the land
• Levelling the site
• Connecting utilities (water, electricity, gas, sewerage)
• Removing trees or large rocks

The extent of site preparation required can significantly impact your overall costs. If your block needs minimal work, you’re in luck. However, if extensive earthworks or retaining walls are necessary, be prepared for additional expenses.

6. Council Approval and Compliance

Navigating council regulations and ensuring your granny flat complies with all local building codes is crucial. This process can add to your costs in several ways:

• Application fees
• Drafting and documentation costs
• Potential design modifications to meet regulations
• Inspections and certifications

While these costs are necessary, they can sometimes catch people off guard. It’s important to factor them into your budget from the get-go.

7. Labour Costs

Labour costs can vary depending on your location and the complexity of your project. In urban areas or regions with high demand for construction services, you might find labour costs to be higher.

Also, if your granny flat requires specialised trades (like custom cabinetry or intricate tiling work), this can increase your labour costs.

8. Fixtures and Fittings

The quality and style of fixtures and fittings you choose can significantly impact your budget. This includes things like:

• Kitchen Appliances
• Bathroom fixtures
• Lighting
• Flooring
• Window treatments

While it might be tempting to go for top-of-the-line everything, remember that mid-range options can often provide a great balance of quality and affordability.

9. Energy Efficiency and Sustainability

In 2024, energy efficiency isn’t just a nice-to-have – it’s often a requirement. Incorporating energy-efficient features into your granny flat might increase upfront costs but can lead to long-term savings. Consider things like:

• Solar panels
• Double-glazed windows
• High-quality insulation
• Energy-efficient appliances
• Water-saving fixtures

While these features may add to your initial investment, they can reduce ongoing costs and increase the appeal of your granny flat to potential tenants or buyers.

10. Additional Features

Finally, any additional features you want to include will impact the overall cost. This might include:

• Landscaping
• Fencing
• Carports or garages
• Smart home technology
• Security systems

These extras can quickly add up, so it’s important to prioritise what’s most important to you.

Are you looking for a granny flat in Mornington Peninsula, Yarra Valley, or Sunbury? Contact us today.

Breaking Down the Costs: A Typical Granny Flat Budget 

To give you a clearer picture, let’s break down the costs for a typical mid-range granny flat (around 50m²) in 2024:

• Site preparation and foundations: $15,000 – $25,000
• Construction (walls, roof, windows, doors): $60,000 – $80,000
• Internal fit-out (plumbing, electrical, flooring, painting): $30,000 – $40,000
• Kitchen and bathroom: $15,000 – $25,000
• Council fees and certifications: $5,000 – $10,000
• Design and engineering: $5,000 – $10,000

Total estimated cost: $130,000 – $190,000

Remember, this is just an example. Your actual costs may vary depending on the factors we discussed earlier.

Ways to Save on Your Granny Flat Build

If you’re looking at these numbers and feeling a bit overwhelmed, don’t worry! There are several ways you can potentially reduce the cost of building your granny flat:

• Opt for a simple design: A straightforward, open-plan layout will generally be more cost-effective than a complex design. Simple designs require less materials and labour and often result in faster construction times. Consider a studio or one-bedroom layout with an efficient use of space to maximise savings.
• Choose standard materials: While high-end materials look great, standard options can still provide a quality finish at a lower cost. Opt for readily available materials that your builder is familiar with. This not only reduces material costs but can also speed up construction, saving on labour expenses.
• Consider prefab or kit homes: These can sometimes be more affordable than traditional builds and often have shorter construction times. Prefab granny flats are built in a factory and assembled on-site, which can lead to significant savings in both time and labour costs. They also often come with fixed prices, helping you avoid unexpected expenses.
• DIY where possible: If you’re handy, you might be able to tackle some aspects of the build yourself, like painting or landscaping. However, be realistic about your skills and the time you can commit. Attempting complex tasks without proper expertise can lead to costly mistakes and delays.
• Prioritise your must-haves: Focus on the elements that are most important to you and be willing to compromise on others. Create a list of essential features and nice-to-haves. This will help you make informed decisions when balancing your budget and desires, ensuring you spend money on the aspects that matter most to you.
• Shop around for quotes: Don’t just go with the first builder you find. Get multiple quotes to make sure you’re getting a fair price. Be sure to compare quotes on a like-for-like basis, considering factors such as materials, timelines, and inclusions. Remember, the cheapest quote isn’t always the best value in the long run.
• Plan carefully: Good planning can help avoid costly changes or delays during construction. Spend time upfront finalising your design and selections. Changes mid-construction can be expensive and cause delays. Consider working with a professional designer or your builder to create a comprehensive plan before breaking ground.
• Consider timing: Building during the off-peak season might result in better rates from contractors. Many builders have quieter periods, typically during winter or immediately after the holiday season. During these times, they may offer more competitive rates or be able to start your project sooner.

Hidden Costs to Watch Out For

When budgeting for your granny flat, be aware of these potential hidden costs:

1. Council contributions: Some councils charge additional fees for increased density.
2. Utility connections: Connecting to existing utilities or upgrading services can be costly.
3. Unforeseen site issues: Problems like poor soil quality or hidden rock might only become apparent once work begins.
4. Variations: Changes to the plan during construction can quickly add up.
5. Furnishings and appliances: Don’t forget to budget for these if you plan to rent out your granny flat.
6. Landscaping: Restoring your garden post-construction or adding new landscaping can be an additional expense.

Maintenance and repairs: Factor in ongoing costs to keep your granny flat in top condition.

Is Building a Granny Flat Worth the Investment?

After all this talk about costs, you might be wondering if building a granny flat is really worth it. In most cases, the answer is a resounding yes! Here’s why:

• Increased property value: A well-designed granny flat can significantly boost your property’s overall value.
• Rental income: If you choose to rent out your granny flat, it can provide a steady stream of additional income.
• Flexibility: Whether you need space for family, a home office, or a guest suite, a granny flat offers versatile living options.
• Multigenerational living: It’s a great solution for families looking to keep elderly parents close while maintaining privacy.
• Potential tax benefits: Depending on how you use your granny flat, there may be tax advantages (always consult with a tax professional for advice).

To read into the investment potential, refer to our guide on maximising property investment with granny flats.

Making Your Granny Flat Dream a Reality

Building a granny flat is a significant investment, but with careful planning and the right team on your side, it can be an incredibly rewarding project. Here at Superior Granny Flats, we’re passionate about helping homeowners like you turn their granny flat dreams into reality.

Our team of experts understands the ins and outs of granny flat construction, and we’re committed to delivering high-quality granny flats that meet your needs and budget.

Ready to take the next step? We’d love to chat with you about your project. Our friendly team can provide personalised advice, help you explore your options, and give you a detailed quote tailored to your specific requirements.

Give us a call or visit our website to book a consultation.