Adding a granny flat to your property is one of the smartest investments an Australian homeowner can make. Whether you want extra space for ageing parents, a home office, or rental income, the biggest question is always the same: how much will it actually cost? The short answer is $80,000 to $250,000 or more, depending on whether you choose a prefab kit or a custom build. This guide breaks down every granny flat cost in Australia by build type, size, component, and location so you can set a realistic budget before talking to builders.
How Much Does a Granny Flat Cost? The Short Answer
The total granny flat cost in Australia varies widely based on whether you choose a prefab or custom-built design. Here is how the three main budget tiers compare for a standard 60-square-metre build.
| Budget Tier | Cost Range | Build Type | What You Get |
|---|---|---|---|
| Budget | $80,000–$130,000 | Prefab or kit home | Factory-built modular design delivered to site. Standard finishes, limited layout options, 1-bed or studio floor plan. Fastest construction time (8–12 weeks on site). |
| Mid-range | $130,000–$200,000 | Custom site-built or premium prefab | Professionally designed layout, quality kitchen and bathroom, insulation upgrades, timber or composite cladding, 1–2 bedrooms. Build time 16–24 weeks. |
| Premium | $200,000–$300,000+ | Fully custom build | Architect-designed floor plan, premium finishes (stone benchtops, hardwood flooring, high-end appliances), separate outdoor entertaining area, accessibility features, 2 bedrooms with ensuite. Build time 20–30 weeks. |
These figures include site preparation, council approvals, and utility connections for a relatively flat block with good access. Sloped sites, difficult access, or rock excavation can push costs 15 to 30 percent higher.
Prefab vs Custom Build: Which Costs Less?
The biggest cost decision is whether to go prefab (modular) or custom site-built. Each approach has trade-offs beyond the headline price.
| Factor | Prefab / Modular | Custom Site-Built |
|---|---|---|
| Total cost (60m²) | $80,000–$150,000 | $120,000–$250,000+ |
| Cost per m² | $1,300–$2,500 | $2,000–$4,200+ |
| Design flexibility | Limited floor plans (10–20 options) | Fully customisable layout, materials, finishes |
| Build time (on site) | 8–12 weeks | 16–30 weeks |
| Quality control | Factory conditions, consistent | Weather-dependent, varies by builder |
| Resale value add | Moderate (10–15% of property value) | Higher (15–25% of property value) |
| Site suitability | Best for flat, accessible blocks | Suits any site including sloped or tight access |
| Council approval | Same requirements as custom | Same requirements as custom |
Prefab granny flats offer faster construction and lower upfront costs, but custom builds allow you to match the main dwelling’s materials and style, which typically adds more resale value. A licensed builder on TradieVerify can assess which option works best for your block.
Factors That Affect Granny Flat Cost
Every project is different. These eight factors have the biggest impact on your granny flat cost.
1. Build Type and Size
A 40m² studio costs significantly less than a 60m² two-bedroom design. Most states cap secondary dwellings at 60m², though QLD allows up to 80m² and WA up to 70m². The cost per square metre drops as floor area increases because fixed costs (site preparation, council fees, utility connections) are spread across more space.
2. Site Conditions
Site preparation is one of the most variable granny flat costs. A flat block with existing vehicle access might need $5,000 to $10,000 in site works. A sloped block requiring retaining walls, excavation, or difficult crane access can push site costs to $15,000 to $40,000. Rock excavation adds $150 to $300 per cubic metre.
3. Council Approval Pathway
In NSW, Complying Development approval through a private certifier costs $2,000 to $5,000 and takes as little as 10 business days. A full Development Application (DA) through council takes 8 to 16 weeks and costs $3,000 to $10,000. Other states have their own approval pathways with varying costs and timeframes.
4. Utility Connections
Every granny flat needs separate connections for electricity, water, sewer, and often telecommunications. If your granny flat sits close to existing services, connection costs run $5,000 to $12,000. If services need to be extended 20 metres or more across the property, expect $12,000 to $25,000. A licensed plumber and licensed electrician handle these connections.
5. Kitchen and Bathroom Specification
The kitchen and bathroom are the most expensive rooms per square metre in any granny flat. A budget kitchen (laminate benchtops, basic appliances, flat-pack cabinetry) costs $5,000 to $10,000. A mid-range kitchen with stone benchtops, quality appliances, and custom cabinetry runs $10,000 to $20,000. Bathrooms follow a similar pattern: $5,000 to $8,000 for budget, $8,000 to $18,000 for mid-range with floor-to-ceiling tiles.
6. Cladding and Roofing Materials
External cladding ranges from fibre cement ($40–$60/m²) to timber weatherboard ($80–$140/m²) and brick veneer ($120–$180/m²). Roofing varies from Colorbond steel ($50–$80/m²) to concrete tiles ($80–$120/m²). Cladding choice significantly impacts total granny flat cost.
7. Your Location
Where you build in Australia directly affects labour rates, material delivery costs, and council fees. Sydney and Melbourne are the most expensive markets, with granny flat costs running 10 to 20 percent above the national average. Brisbane and Perth sit near the national average, while Adelaide, Hobart, and regional areas are generally 5 to 15 percent cheaper.
8. Accessibility and Energy Efficiency
Livable Housing Design compliance for wheelchair accessibility adds $5,000 to $15,000. Exceeding the NCC minimum 7-star energy rating with improved insulation, double glazing, and solar hot water adds $8,000 to $20,000 but reduces long-term running costs.
Itemised Cost Breakdown
Understanding where your money goes helps you evaluate quotes and decide where to invest or save. Here is a typical itemised granny flat cost breakdown for a mid-range 60-square-metre custom build ($130,000–$200,000).
| Work Item | Cost Range (AUD) | Notes |
|---|---|---|
| Design and approvals | $5,000–$15,000 | Architectural plans, engineering, energy assessment, surveyor, council/certifier fees. Complying Development (NSW) saves vs full DA. |
| Site preparation | $5,000–$20,000 | Clearing, levelling, temporary fencing, tree removal (if council permits), access track. Sloped sites cost more. |
| Concrete slab | $8,000–$18,000 | Standard raft slab at $80–$130/m². Includes formwork, reinforcement, and plumbing rough-in under slab. Costs rise on reactive clay or sloped sites. |
| Framing and structure | $12,000–$25,000 | Timber or steel frame, roof trusses, windows, external doors. Steel framing adds 10–15% over timber but suits termite-prone areas. |
| Roofing | $5,000–$12,000 | Colorbond steel is the most common choice. Includes gutters, downpipes, and fascia. Licensed roofer rates apply. |
| External cladding | $6,000–$15,000 | Fibre cement, weatherboard, brick veneer, or composite panels. Brick veneer is the most expensive but matches many main dwellings. |
| Plumbing (rough-in and fit-off) | $8,000–$18,000 | Hot and cold water, sewer connection, gas (if applicable), bathroom and kitchen fit-off. Under-slab drainage is the critical path item. |
| Electrical | $6,000–$14,000 | Switchboard, wiring, power points, lighting, smoke alarms, TV/data points. Includes connection to mains supply. |
| Kitchen | $6,000–$18,000 | Cabinetry, benchtop, sink, cooktop, oven, rangehood, splashback. Budget laminate to premium stone benchtop range. |
| Bathroom | $5,000–$15,000 | Tiles, waterproofing (AS 3740:2021), toilet, vanity, shower screen, tapware. Licensed tiler and waterproofer required. |
| Internal fit-out | $8,000–$18,000 | Plastering, painting, flooring (carpet, vinyl plank, tiles), internal doors, built-in wardrobes, window furnishings. |
| Utility connections | $5,000–$20,000 | Electrical switchboard extension, water meter, sewer junction, stormwater, telecommunications. Distance from existing services is the main cost driver. |
| Landscaping and external | $3,000–$10,000 | Pathway, driveway extension, fencing, basic landscaping, clothesline, letterbox. A licensed landscaper handles retaining walls and drainage. |
Total mid-range estimate: $82,000–$218,000. The wide range reflects site complexity, finish quality, and location. Most mid-range 60-square-metre granny flats land between $140,000 and $190,000 all-in.
Regional Cost Comparison
Granny flat cost varies by city due to differences in labour rates, material transport costs, and local council fees.
| City | Budget (60m²) | Mid-Range (60m²) | Premium (60m²) | Cost vs National Avg |
|---|---|---|---|---|
| Sydney | $100,000–$160,000 | $160,000–$230,000 | $230,000–$330,000+ | +15–20% |
| Melbourne | $90,000–$145,000 | $145,000–$210,000 | $210,000–$300,000+ | +10–15% |
| Brisbane | $80,000–$130,000 | $130,000–$190,000 | $190,000–$270,000+ | Average |
| Perth | $85,000–$135,000 | $135,000–$195,000 | $195,000–$280,000+ | +5% |
| Adelaide | $75,000–$120,000 | $120,000–$175,000 | $175,000–$250,000+ | −5–10% |
| Canberra | $85,000–$135,000 | $135,000–$195,000 | $195,000–$280,000+ | +5% |
| Hobart | $75,000–$120,000 | $120,000–$175,000 | $175,000–$250,000+ | −5–10% |
| Darwin | $90,000–$145,000 | $145,000–$210,000 | $210,000–$300,000+ | +10–15% |
Sydney’s premium reflects higher labour rates and stricter council requirements. Darwin’s premium is driven by freight costs and cyclone-rated construction requirements.
How to Get Accurate Quotes
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Get a site survey first. A registered surveyor ($800–$1,500) confirms lot boundaries, easements, and contour levels. Every builder needs this to quote accurately.
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Obtain at least three quotes. Compare specialist granny flat builders, not just general builders. Search for a licensed builder on TradieVerify.
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Ensure quotes are like-for-like. Some builders quote structure-only and list site works, connections, and council fees as provisional sums. Others include everything turnkey. Ask for the same breakdown so you can compare.
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Check exclusions. Demolition, tree removal, stormwater drainage, retaining walls, and landscaping are commonly excluded and can add $10,000 to $30,000.
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Clarify provisional sums. Ask what happens if actual costs exceed or fall below the provisional allowance for items like rock excavation.
Hidden Costs and Exclusions
These costs catch homeowners off guard. Budget for them from the start.
Council and government fees. Some councils charge infrastructure levies, developer contributions (Section 7.12 in NSW), or long service leave levies, adding $2,000 to $8,000.
Demolition of existing structures. If an old shed, carport, or garage sits on the granny flat site, demolition and removal costs $2,000 to $8,000 depending on size and materials. Asbestos-containing structures cost more due to licensed removal requirements.
Stormwater management. The additional impervious area triggers on-site detention (OSD) requirements in most councils. OSD systems cost $3,000 to $8,000.
Bushfire and flood zone compliance. BAL-rated properties require fire-rated construction that adds $10,000 to $25,000. Flood-prone lots may need raised floor levels, adding $5,000 to $15,000.
Separate metering. Separate electricity and water meters for rental purposes cost $1,500 to $4,000. Not all utilities allow separate metering.
Ongoing council rates. Some councils increase rates when a secondary dwelling is added. Check before committing.
Tips to Save Money on Your Granny Flat
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Choose a standard floor plan. Custom architectural plans cost $5,000 to $15,000. Many builders offer pre-designed floor plans for $1,000 to $3,000 that are already engineer-certified and council-ready.
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Stick to 60 square metres or less. Most state regulations allow secondary dwellings up to 60m² through streamlined approval pathways. Exceeding this threshold triggers more expensive approval processes and may require development consent.
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Position the build close to existing services. Every metre of additional trenching for sewer, water, and electrical adds cost. Siting the granny flat within 10 to 15 metres of existing service points minimises connection costs.
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Use prefab or modular where site access allows. Prefab builds save 20 to 30 percent on construction costs and halve the build time. The trade-off is less design flexibility and a need for crane access to the site.
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Bundle trades. If the builder you hire is also a licensed carpenter and can coordinate plumbing, electrical, and tiling trades, you avoid paying multiple project management margins.
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Avoid over-specifying finishes. A $6,000 budget kitchen functions identically to an $18,000 premium kitchen. For rental income, mid-range finishes provide the best return on investment.
State-by-State Approval Rules
Granny flat regulations vary significantly across Australian states and territories. Understanding your state’s rules is essential before budgeting.
New South Wales
NSW has the most established granny flat framework in Australia. Secondary dwellings up to 60m² can be approved under Complying Development on lots of 450m² or more, with a private certifier processing the application in 10 to 20 business days. The granny flat must sit behind the main dwelling and cannot be subdivided from the main lot. Council Development Applications are required if the property is in a heritage conservation area, flood zone, or bushfire-prone land. NSW allows granny flats to be rented to anyone, not just family members.
Victoria
Victoria permits “Dependent Person’s Units” (DPUs) that must house a person dependent on a resident of the main house (elderly relative or person with a disability). This restriction limits rental potential. A planning permit is generally required unless exempt under clause 52.18. The unit must be removed or converted when no longer needed for a dependent person. The VIC government has flagged secondary dwelling reforms.
Queensland
QLD allows “secondary dwellings” in most residential zones with council approval. There is no statewide floor area cap, but most council planning schemes limit secondary dwellings to 80m² or a percentage of the main dwelling. QLD does not restrict who can live in a secondary dwelling, making it suitable for rental income.
Western Australia
WA allows “ancillary dwellings” of up to 70m² on lots of 450m² or more under the R-Codes. Planning approval is required through the local council. WA generally permits ancillary dwellings to be rented, though some councils impose conditions.
South Australia
SA allows “dependent accommodation” limited to use by a family member or employee, restricting rental potential. A Development Application is typically required under the Minister’s Planning Rules.
ACT, Tasmania, and Northern Territory
The ACT allows “secondary residences” on blocks over 500m². Tasmania and the NT have limited secondary dwelling provisions that vary by council. In all three jurisdictions, a development application through the local planning authority is required.
Rental Yield Potential
Many homeowners build a granny flat specifically for rental income. Here is how the numbers typically stack up.
| Metric | Budget Build | Mid-Range Build | Premium Build |
|---|---|---|---|
| Build cost | $100,000 | $165,000 | $250,000 |
| Weekly rent (metro) | $350–$450 | $400–$550 | $500–$700 |
| Annual gross rent | $18,200–$23,400 | $20,800–$28,600 | $26,000–$36,400 |
| Gross yield on build cost | 18–23% | 13–17% | 10–15% |
| Estimated payback | 5–6 years | 6–8 years | 7–10 years |
These gross yields are significantly higher than the 3 to 5 percent typical of standalone investment properties because you are adding a rentable asset to land you already own, eliminating the land cost. Net returns after council rates, insurance, maintenance, and property management fees (7 to 10 percent of rent) will be lower.
Rental income is assessable by the ATO. You can claim depreciation on the building structure (2.5% per year over 40 years) and on fixtures and fittings at accelerated rates. Consult a tax professional for your specific situation.
Frequently Asked Questions
Is it cheaper to build a prefab or custom granny flat?
Prefab granny flats are 20 to 30 percent cheaper than custom builds. A 60m² prefab typically costs $80,000 to $150,000, while a custom design runs $120,000 to $250,000 or more. The gap narrows on difficult sites because both build types face similar site preparation and connection costs.
Do I need council approval for a granny flat?
Yes, every granny flat in Australia requires some form of approval. In NSW, Complying Development through a private certifier is the fastest pathway (10–20 business days). All other states require a Development Application through the local council. Building without approval is illegal and can result in demolition orders.
Can I rent out my granny flat?
It depends on your state. NSW and QLD allow rentals to anyone. WA generally permits rentals but some councils impose conditions. VIC, SA, and TAS restrict secondary dwellings to dependants or family members, limiting rental potential. Check local planning rules before building with rental income in mind.
How long does it take to build a granny flat?
A prefab takes 8 to 12 weeks on site after delivery, plus 4 to 8 weeks for manufacturing. A custom build takes 16 to 30 weeks from slab to handover. Add 2 to 16 weeks for approvals. Total timeline from decision to move-in is typically 6 to 12 months.
Does a granny flat add value to my property?
Yes. A well-built granny flat typically adds 20 to 30 percent of its build cost to the property’s market value. In areas with strong rental demand, the value uplift can be higher because buyers factor in the rental income stream.
What is the maximum size for a granny flat?
Most states cap secondary dwellings at 60m² of habitable floor area. QLD allows up to 80m² depending on the local planning scheme, and WA permits up to 70m². These limits generally exclude covered outdoor areas like verandahs and carports, which can add usable space without increasing the regulated floor area.
Related Guides
- How to Hire a Licensed Builder — Our builder hiring guide
- Building Permits and Approvals — Our building permits guide
- How Much Does a New Build Cost Per Square Metre? Full 2025–2026 Price Guide — Our new build costs
Sources
- NSW Department of Planning, Housing and Infrastructure. Secondary Dwellings (Granny Flats) under the Housing SEPP. planning.nsw.gov.au
- Victorian Planning Provisions, Clause 52.18. Dependent Person’s Unit. planning.vic.gov.au
- Queensland Government. Secondary Dwellings Planning Provisions. planning.statedevelopment.qld.gov.au
- Western Australian Planning Commission. State Planning Policy 7.3: Residential Design Codes (R-Codes). wa.gov.au
- Housing Industry Association (HIA). Housing Scorecard 2025. hia.com.au
- Australian Building Codes Board. National Construction Code 2025, Volume Two (Residential). abcb.gov.au
- Australian Taxation Office. Rental Properties Guide 2025. ato.gov.au
- Master Builders Australia. Building Cost Index, March 2025 Quarter. masterbuilders.com.au