How Much Does It Cost To Build A Granny Flat?

For many Sydney homeowners, building a granny flat is one of the smartest investments you can make. Whether it’s for family, rental income, or boosting property value, granny flats offer excellent returns. But one of the first questions people ask is: how much does it cost to build a granny flat?

The answer depends on a range of factors including design, finishes, site conditions, and council requirements. Below, we break down the costs you can expect and what influences them most.

Base Costs for a Granny Flat

In Sydney, the average starting cost to build a granny flat typically ranges between $150,000 and $180,000 for a standard 2-bedroom design.

This usually includes:

• Foundations and structural framing
• Standard kitchen and bathroom
• Internal linings, windows, and doors
• Basic finishes and fittings
• Council or CDC approval fees

This base cost provides a fully functional granny flat, but upgrades and site-specific needs can quickly change the final price.

Factors That Affect the Cost to Build a Granny Flat

1. Size and Layout

• 1-bedroom flats are more affordable.
• 2-bedroom flats cost more but deliver better rental returns and resale value.
• Larger layouts or custom designs will increase costs due to more materials and labour.
  

2. Site Conditions

• Sloping or narrow blocks may need retaining walls, piers, or excavation.
• Sites with difficult access can increase labour and delivery costs.
• Existing trees, easements, or services may also require additional work.

3. Finishes and Upgrades

• High-end kitchens, bathrooms, or flooring will raise the overall price.
• Optional extras such as decks, landscaping, or air-conditioning add to the cost.
• Energy-efficient inclusions (solar panels, water tanks) can be an upfront expense but save money long-term.

4. Approval Pathway

• A Complying Development Certificate (CDC) is often faster and cheaper.
• A Development Application (DA) through council may require additional reports and fees, extending timelines and costs.

5. Services and Connections

• Separate water, electricity, and NBN connections vary in cost depending on location.
• Upgrades to existing services (e.g., switchboard or sewer encasement) can add thousands to the budget.

Budgeting for the Unexpected

It’s always wise to set aside a contingency allowance of at least 5–10% of your total budget. This covers unforeseen site issues, material price fluctuations, or compliance adjustments that may arise during the build.

Our Expert Tip

While upfront cost is important, think long-term. A slightly higher investment in design or finishes can significantly increase your rental income and property value. For most homeowners, the return on investment from a well-designed 2-bedroom granny flat outweighs the extra cost compared to a basic build.

Why Build With Granny Flat Solutions?

At Granny Flat Solutions, we provide transparent pricing with no hidden surprises. Our quotes are detailed, inclusive, and tailored to your block, so you know exactly what’s covered. With award-winning designs and over two decades of experience, we’ll help you maximise your investment while keeping costs clear and manageable.

Ready to Learn the Cost of Your Granny Flat?

Book your free site consultation today and receive a tailored quote based on your block, design preferences, and lifestyle goals. Discover why Granny Flat Solutions is Sydney’s trusted name for quality, value, and service.