House Extension or Granny Flat: Which One is Right For You?

March 26, 2024

Expanding living space is a significant decision for homeowners looking to accommodate growing families, create rental opportunities, or simply enhance the functionality and value of their property. There are two popular options for this, a granny flat or extension of the existing house.

While both options offer increased space, they come with distinct differences and considerations that should be carefully weighed before making a decision. Through this guide, we will explore the key differences between a house extension or granny flat, examining various factors such as cost, construction timelines, and long-term goals. By gaining insights into the key differences between the two, homeowners can better evaluate which option suits their requirements and preferences.

A living room with a couch , chair and coffee table

A House Extension or Granny Flat?

When considering expanding living space, homeowners often weigh the options of a granny flat or extension. Both choices offer unique advantages and cater to different needs, making it essential to understand the distinctions before moving forward.

A house extension involves expanding the existing structure of the home, which may include adding extra rooms, a new floor, or enlarging existing spaces like the kitchen or living room. This option seamlessly integrates with the main house, providing a unified living experience for the occupants.

On the other hand, a granny flat, or accessory dwelling unit (ADU), is a standalone structure typically built in the backyard. It offers a separate living space with its own entrance, kitchen, bathroom, and living areas, providing privacy and autonomy for its occupants.

It's crucial for homeowners to assess their lifestyle, budget, and long-term plans for their property when making this decision. While a house extension may require less initial investment and construction time, a granny flat offers versatility and potential for additional income streams. Ultimately, the decision between an extension or granny flat depends on individual preferences, needs, and constraints. We will explore some of these below.

Pros and Cons of Granny Flat or Extension

When contemplating either a granny flat or extension to expand your living space, it's essential to weigh the pros and cons of each option. Understanding these factors is crucial for maximising the benefits of your dream space.

Granny Flats

The Pros:

Additional Income Stream

Granny flats offer the opportunity for homeowners to generate rental income by leasing out the space to tenants or listing it as an Airbnb rental.

Increased Property Value

Adding a granny flat can significantly enhance the market value of a property, making it a profitable investment in the long run.

Quick Construction

Granny flats typically have shorter construction timelines which allow homeowners to enjoy the additional space much faster compared to a house extension.

The Cons:

Outdoor Space Consumption

Building a granny flat in the backyard occupies outdoor space which diminishes the areas for landscaping, gardening, or outdoor activities.

Regulations

Depending on local zoning laws and building regulations, obtaining permits for constructing a granny flat may pose challenges and add complexity to the process.

House Extension

The Pros:

Customisation

With a house extension, homeowners have the freedom to customise the design and layout according to their specific needs and preferences, creating a personalised living space.

Value Addition

Well-executed house extensions can significantly increase the overall value of the property, offering a high return on investment.

Space Saving

House extensions, whether vertical or horizontal additions, efficiently use space by extending from the footprint of the current structure. This minimises additional land use in contrast with granny flats that often require a separate plot of land and occupy more outdoor space.

The Cons:

Complexity

House extensions often involve intricate planning, architectural considerations, and coordination with contractors, adding complexity to the construction process.

Cost

Depending on the scope of the project and the materials used, house extensions can be more expensive than granny flats, requiring a significant financial investment.

Design

Achieving seamless integration between the existing structure and the extension can be challenging, requiring careful attention to architectural design and style.

How to Choose Between Building a House Extension or Granny Flat

Here are some crucial considerations to help guide this decision-making process on whether to build a house extension or granny flat:

Space

Evaluate the available space on your property and how much additional living space you require. A granny flat may be more suitable if you have adequate land or prefer a separate living area. On the other hand, a house extension could be ideal if you have limited land space and wish to expand your existing home seamlessly.

Budget

Assess your financial resources and determine how much you're willing to invest in the project. Granny flats often have lower construction costs compared to house extensions, making them a more budget-friendly option for some homeowners.

Time

House extensions may involve longer construction timelines, especially if extensive additions are required. On the contrary, granny flats typically have shorter construction periods, allowing you to enjoy the additional living space sooner.

Preference

Do you value privacy and independence, or do you prefer a cohesive living space connected to your main home? Understanding your lifestyle preferences can help guide your decision between a house extension and a granny flat.

Long-term Goals

Think about your long-term plans for your property. Are you looking to accommodate growing family members, generate rental income, or increase the resale value of your home? Consider how each option aligns with your long-term objectives and aspirations.

Cost vs. Return

Evaluate the potential return on investment for each option. While house extensions may offer higher returns in terms of property value appreciation, granny flats can provide immediate rental income. Assess the financial implications of each choice and determine which option offers the best balance between cost and return.

Purpose

Clarify the primary purpose of expanding your living space. Are you looking to accommodate elderly family members, create a rental opportunity, or simply enhance the functionality of your home? Identifying the purpose can help narrow down your options and prioritise your needs accordingly.

Request a Quote to Build a House Extension or Granny Flat in Perth Today!

The key to decision-making is to prioritise what matters most to you and your family when expanding your living space. By carefully evaluating the different offerings and considering your unique circumstances, preferences, and long-term goals, you can make an informed decision between building a house extension or a granny flat.

Whether you're envisioning a house extension that seamlessly integrates with your existing home or a stylish granny flat that offers privacy and versatility, Prestige Renovations has the expertise to deliver exceptional results. Our goal is to exceed your expectations and create a custom living space that enhances your lifestyle and adds value to your home.

Don't hesitate to reach out to Prestige Renovations today to request a quote for your house extension or granny flat and start turning your dream space into reality.

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What Is a Granny Flat? Full Guide for Australian Homeowners

October 27, 2025

Granny flats are no longer just for grandparents. Across Australia, they’re being built as rental units, guest accommodation, or smart add-ons for multigenerational families. Climbing property prices and limited housing supply have made granny flats an attractive option for homeowners seeking flexibility and extra income. Before you build, there are legal and planning steps to navigate. Each state has its own council rules, and the approval process can feel overwhelming. Prestige Homes & Granny Flats provides practical guidance on paperwork, design, and construction, keeping your project organised and on track from the start. Before you start asking what granny flats are and how to build one, remember there are legal and planning steps to navigate. Each state has its own council rules, and the approval process can feel overwhelming. Prestige Homes & Granny Flats provides practical guidance on paperwork, design, and construction, keeping your project organised and on track from the start. What are Granny Flats? So what is a granny flat? The answer is simple. It’s a small, self-contained home built on the same block as a main residence. Think of it as a compact version of a regular house, usually including a kitchen, bathroom, living area, and one or two bedrooms. Most states cap their size at around 60 m², though exact limits vary. In Queensland, they’re often called “secondary dwellings,” while in Victoria, you’ll hear “dependent person’s unit.” No matter the name, the idea is the same: extra living space with independence built in. What Are Granny Flats Called in Perth? Across Perth and the wider WA region, granny flats are formally classified as “ancillary dwellings” under local council planning regulations. They’re permitted on most residential-zoned blocks that meet the minimum land size, with a maximum floor area of up to 70 m². A major difference in WA is who can occupy them. Since 2015, Perth’s rules have allowed ancillary dwellings to be rented to non-family members, giving homeowners more flexibility for rental income or family use. Councils such as the City of Perth, City of Stirling, and City of Joondalup apply these state planning guidelines, though it’s always worth checking your local council’s requirements before starting. In Perth, granny flats can take several forms. They may be built as a detached unit, joined to the main house, or created by converting existing structures like garages. This flexibility makes them an appealing way to add space, boost property value, or create rental income without leaving your current suburb. What Is Granny Flat: Legal and Planning Rules You Need to Know To fully understand what granny flats are, you also need to follow council regulations that vary from state to state. Zoning and Land Use Your block must be in the correct residential zone to allow an ancillary dwelling. Perth councils set these rules, so it’s important to confirm land use requirements before drawing up plans. Size Limits & Design In most parts of Australia, granny flats are limited to 60 m². In Perth and wider WA, ancillary dwellings can be up to 70 m², provided they meet council design codes for height, setbacks, and appearance. Approval Processes Some states require both planning and building permits, while others fast-track approval if certain criteria are met. In WA, approvals generally move faster when plans follow the Residential Design Codes (R-Codes) . Rental & Occupancy Rules Unlike some states, Perth homeowners can lease ancillary dwellings to non-family members. Since the 2015 policy change, this flexibility has allowed granny flats to serve as either rental income properties or extra family space.

Step-by-Step Custom Home Build Checklist

October 24, 2025

Building your own custom home in Australia is exciting, but it can sometimes feel like you’ve got a lot on your plate. From design choices and council approvals to budgets and timelines, there are plenty of moving parts that can quickly become overwhelming. That’s why having a clear checklist is important. We’ll guide you through the key steps in building a custom home checklist. Whether it is your first build or an upgrade to suit your lifestyle, our team helps you stay organised and confident right through to the final handover. Building a Custom Home Checklist Think of a custom home checklist as your blueprint for staying organised. It turns the chaos of construction into a sequence of manageable steps. Without a checklist, you could face delays, unexpected costs and unnecessary stress. A detailed custom home build checklist ensures a smooth, cost-effective and worry-free build. It’s not just for first-time owners either. Even seasoned homeowners upgrading to a custom space benefit from a structured approach that keeps the build on track and aligned with their vision.