It’s no secret the cost of construction is on the rise. But what may be a secret to some is building a granny flat can be a cost-effective way to add extra living space to your property. In this blog post, we will break down every cost involved in designing and building a granny flat, from planning and permits to appliances and furniture. We’ll also discuss how you can keep your costs as low as possible without compromising on quality or style.
It’s important to look at some of the problems facing the construction industry in Australia and see how this could affect house prices.
If you’re considering adding a granny flat to your property, read on for all the information you need!
WHAT IS A GRANNY FLAT?
A granny flat is a small, self-contained home either attached to, or separate from, a larger property. They are popular as a way to provide extra living space for family members or to rent out as an income-producing property. Granny flats can be used for a variety of purposes, including as a home office, guest room, or rental property.
WHY ARE THEY BECOMING MORE POPULAR?
One of the main reasons granny flats are becoming more popular is because they offer a cost-effective way to add extra living space to your property. They can be built for a fraction of the cost of a house, and there are often fewer permits and approvals for granny flat requirements. Additionally, granny flats can be used to generate income by renting them out to tenants.
WHAT ARE THE COSTS INVOLVED?
Your house-building budget may need to include the following items:
LAND
If you already own the land on which you’ll be building, then this cost is obviously zero. But if you’re looking to buy land specifically for the purpose of building a granny flat, then you need to factor in the cost of purchase as well as any associated fees (such as stamp duty).
A granny flat is added to a block with a dwelling, you will be purchasing a house on a block of land with space to add the granny flat. The cost of land will vary depending on the location; do your research before making a purchase.
DESIGN
There is a vast range of things to be considered when designing your granny flat. It may be detached or attached to the main house. You will need to decide on the floor plan or layout of the property, inside and outside. Will it include a garage? A swimming pool?
The design team at Acrow Granny Flats have a range of layouts and floor plans available, including
- One bedroom designs
- two bedrooms designs
- Garage incorporated
- Two-storey granny flats
Plus, of course, take your own ideas along and we’ll develop a tailor-made design with you.
CONSTRUCTION
This includes the cost of materials, labour, and any other costs associated with actually building the granny flat. The cost of construction will vary depending on the size and complexity of the granny flat, get a few quotes from different builders before settling on a price.
Note: House builders across Australia are currently facing problems likely to be reflected in their house prices. See “Issues being faced by house builders in Australia”, below.
PERMITS AND APPROVALS
Depending on your location, you may need to apply for planning permission or other approvals before you can start construction. These costs can vary depending on the complexity of your application, get an estimate from your local council before you proceed.
Acrow Granny Flats will apply for council approval for permission to construct your granny flat on your behalf. Be sure to ask about costs and expected duration.
FURNITURE AND APPLIANCES
If you’re planning on furnishing your granny flat, you need to factor in the cost of furniture, bedding, kitchenware, and any other items you’ll need to make your granny flat comfortable and livable. These costs can vary depending on your taste and budget.
UTILITIES AND ONGOING COSTS
Not part of your initial cost budget, but you need to plan for ongoing costs if you intend to live in your new granny flat.
If you’re planning on connecting your granny flat to mains water, electricity, and gas, then you need to factor in the cost of connection fees as well as any monthly bills you’ll incur. These costs will vary depending on your location and consumption, get an estimate from your local utility providers before you move in.
Make sure you also look into the cost of internet connection and local council rates, not forgetting rates, in particular, tend to increase regularly.
ISSUES BEING FACED BY HOUSE BUILDERS IN AUSTRALIA
Australian House builders are facing an unprecedented number of negative forces at the moment. Many building companies have folded, unable to afford to deliver against their contracts. Most of the others are facing difficulties likely to impact the cost of homes.
Some of the issues:
LABOUR SHORTAGES
Following border closures and technical colleges and TAFEs suspending training during the Coronavirus pandemic and subsequent lockdowns, there is an ongoing shortage of skilled labourers.
This is one of the main issues housebuilders are currently facing in Australia. A shortage of skilled labourers, such as carpenters and bricklayers, has resulted in an increase in wages, making it more expensive to build houses.
BUILDING MATERIALS
Another cost to be taken into account when building a new house is the price of materials. This is also a casualty of the pandemic, when factories closed across the world, including those involved in the manufacture of house-building materials, such as timber and steel.
The ongoing material shortage, coupled with a growth in demand has resulted in increased prices.
BIG FLUCTUATIONS IN DEMAND
When people were forced to work from home, starting in 2020, they had more spare time and more money available. This triggered a demand for home improvements, to help ease the pressure of the whole family being stuck in the home. There was a boom in demand for renovations, including better outdoor areas and home workplaces.
Also in 2020, the government introduced the “homebuilder grant” to help stimulate the building industry and create jobs. This was a large cash sum, snapped up by over 130,000 Australians, triggering a housing boom.
WHAT ISSUES?
Many construction companies use fixed-price contracts for their work. Customers want to understand exactly what they’ll pay, with no “hidden extras”.
The big problem, now, for most of the house building industry is most of the fixed price contracts signed in 2020 and 2021 will potentially be completed at a loss. Labour material costs continue to rise while the original costing for the contract is no longer realistic.
WHAT CAN I DO TO HELP ENSURE MY HOUSE GETS BUILT?
If a building company faces long-term cash flow problems, with higher costs and fixed prices there is a high likelihood it will become insolvent and possibly go into liquidation. In this case, you would join the list of creditors of the business. It is unlikely your house will ever be completed and you may not get your money back.
It may be a smart move to meet with your building company and, possibly, renegotiate your building contract, rather than lose your home.
HOW TO KEEP YOUR COSTS DOWN
While building a granny flat can be costly, there are ways to keep your costs down without compromising on quality or style. Here are a few tips:
- Choose a simple design: A complex design will cost more to build, stick to a simple layout with minimal features. Ask the design team at Acrow Granny Flats about costs related to the different designs
- Using particular materials will be more cost-effective than others. Again, ask your design contact.
- Furnish on a budget: There are plenty of affordable options out there if you’re willing to shop around.
By following these tips, you can build a stylish and cost-effective granny flat meeting your needs and budget.
WHAT DO YOU GET WITH AN ACROW GRANNY FLATS GRANNY FLAT?
When Acrow Granny Flats are building your granny flat you receive an amazing end-to-end service. From designs, through council approvals to the handover of the keys to your home.
Even better, when you are considering costs, our fixed-price homes are built with high-quality inclusions from top-quality Australian suppliers including Colorbond, Harvey Norman and Dulux. You will be moving into a well-decorated home with appliances already installed, saving you money.
Our appliances are premium and our benchtops are top-of-the-line. Plus, we waterproof every bathroom and laundry area with two coats of protection to ensure your home is always in great condition. And our tiles and flooring are modern and stylish, ensuring your home will look great from the instant you move in.
Contact us today and ask about our amazing granny flats.