Granny flats: four places to put one
A granny flat is a self-contained home for a relative that shares a property with the family. People use the name for an annexe in the garden, but it can just as well be part of the house itself, a converted garage, or an extension built for the purpose.
New-build flat, studio to one bedroom
£44,000 to £102,500
Including VAT. Conversions can cost less. A guide, not a quote.
Choosing where it goes
Start from the space you already have. The cheapest square metre is the one with walls and a roof already round it, as long as it is sound and in the right place.
| Where | In its favour | Against it |
|---|---|---|
| Part of the house | Already built; services close by; easy to check on someone | Takes rooms from the family; harder to give a separate entrance |
| Converted garage | Walls and roof exist; often at ground level | Floor, walls and roof usually need upgrading; you lose the parking |
| Extension | Attached and warm; can share a door with the house | Needs space beside or behind the house; building work next to home life |
| Detached, in the garden | Privacy for everyone; built away from the house | Service trench across the garden; most planning scrutiny |
A flat inside the house
If the house has a ground-floor bedroom and a room beside it, a flat can sometimes be made with a new kitchen and shower room and little else. The main costs are plumbing and drainage to where the new kitchen and bathroom go, fire separation between the flat and the house, and a second front door if you want one.
Turning part of a house into a flat for a relative does not usually need planning permission if it remains part of the same household. Building regulations still apply to the new bathroom, the drainage and any structural work.
Converting the garage
A single garage gives enough floor for a studio, a double enough for a separate bedroom. A straightforward conversion into an annexe typically costs £7,500 to £20,000 including VAT, rising when the structure needs more than an upgrade.
The usual work is a new insulated floor laid above the old slab, an insulated inner wall, a wall with a window or door where the garage door was, a new roof covering if the old one is thin, and the services.
An integral garage is often permitted development, though some estates have a condition that keeps garages for cars; check the planning history for your house. A detached garage used as somewhere to live will normally need permission.
An extension built as a flat
An extension built for a relative works well where the garden is small or the person needs help often. A connecting door that can be locked from both sides gives a choice: open while care is needed, closed when everyone wants privacy.
An extension used as a self-contained flat usually needs a planning application, even if its size would otherwise be permitted development.
A flat in the garden
This is the detached granny annexe, and the option with the most privacy on both sides. Our garden annexe guide covers access, foundations and services. A new-build studio or one-bedroom flat in the garden typically costs £44,000 to £102,500 including VAT.
Money and the household
A self-contained flat is often given its own council tax band, but in England an annexe lived in by a relative is charged at half, or not at all if that relative is 65 or over or disabled. Speak to the council when the flat is occupied.
Tell your mortgage lender and home insurer before work starts. Most are content with a family annexe, but they need to know. If a parent is contributing money to the build, take legal advice on how their share is recorded: it matters for inheritance, for any later care assessment and if the house is ever sold.
Where our information comes from
Build prices are our own national guide ranges for 2026 for a finished annexe, drawn from published UK cost guides and shown including VAT. London and the South East usually cost 20 to 40% more. They are a guide, not a quote. Rules on planning, tax and building control come from the official sources below and are summarised for England unless we say otherwise.
- GOV.UK: permitted development rights for householders, technical guidance
- The Town and Country Planning (General Permitted Development) (England) Order 2015, Class E
- GOV.UK: building regulations approval
- The Council Tax (Reductions for Annexes) (England) Regulations 2013
- GOV.UK: council tax cut for family annexes
- HMRC: VAT Notice 708, buildings and construction
Granny flat questions
What is the difference between a granny flat and a granny annexe?
Mostly the name. Both mean self-contained living space for a relative on the family's property. "Annexe" is more often used for a separate building in the garden, "flat" for space inside or attached to the house.
Is it cheaper to convert a garage than to build an annexe?
Often, if the garage is sound and big enough. Once the floor, walls and roof all need replacing, a conversion can cost close to a new building of the same size.
Can a granny flat be rented out later?
Not without planning permission if it was approved as part of the main house, which is the usual case. Letting it to someone outside the family would normally need a new permission.