How to Build a Granny Flat in NSW

What is a Granny Flat?

In NSW planning terms, a granny flat is called a secondary dwelling. It's a self-contained dwelling on the same lot as your main house, with its own kitchen, bathroom, and living areas.

Secondary dwellings can be:

• Detached – A separate building in your backyard
• Attached – Connected to the main house
• Within the main house – A converted garage or basement

Despite the name "granny flat," there's no requirement for the occupant to be a family member. You can rent it to anyone.

The Rules in NSW

Secondary dwellings in NSW are governed by the State Environmental Planning Policy (Housing) 2021, which sets out state-wide rules.

Key requirements:

What to Check on Your Property

Before you start planning, verify these things about your property:

1. Lot size

To build as complying development, the Housing SEPP needs your lot to be at least 450sqm. Check your Deposited Plan or certificate of title for the exact area.

2. Zoning

Secondary dwellings are permitted in most residential zones. Check your LEP zoning. Rural zones have different rules.

3. Existing dwellings

You can only have one secondary dwelling per lot. If you already have one (or a dual occupancy), you can't add another.

4. Easements and covenants

Check your 88B instrument for:

• Drainage easements you can't build over
• Covenants restricting additional dwellings
• Building envelopes or setback requirements

5. Site constraints

Check your Section 10.7 certificate for:

• Flood affectation
• Bushfire prone land
• Heritage listing or conservation area
• Contamination

These constraints don't necessarily prevent a granny flat, but they may affect your approval pathway or require additional design considerations.

Approval Pathways

There are two ways to get approval for a granny flat in NSW:

Complying Development Certificate (CDC)

The fast-track option. If your granny flat meets all the standards in the Housing SEPP and Codes SEPP exactly, you can get a CDC from council or a private certifier.

Timeframe: usually quicker than a DA, because it is assessed against fixed standards

Cost: the certifier's fee proposal

You can't use CDC if:

• Property is heritage listed or in a Heritage Conservation Area
• Land is flood prone (above certain thresholds)
• Land is bushfire prone BAL-40 or BAL-FZ
• The design doesn't meet every standard exactly

Development Application (DA)

If you can't use CDC, you'll need a DA to council. This is also the pathway if you want to vary any standards.

Timeframe: depends on council and how complex the site is

Cost: council's DA fee schedule, plus any consultant reports it asks for

DAs allow more flexibility but take longer and require neighbour notification.

Costs

Granny flat costs vary significantly based on size, finishes, and site conditions, so we don't publish a price range. Each part of the cost comes from a quote:

Renting Out Your Granny Flat

Yes, you can rent out your granny flat to anyone. There's no requirement for the tenant to be a family member.

Rental considerations:

• Separate metering – Consider installing separate electricity and water meters for fair billing
• Privacy – Design for good separation between dwellings (fencing, screening, separate entrances)
• Parking – Council may require an additional parking space
• Access – Tenants typically need independent access without going through your property

Rental income potential

Granny flat rent depends on location and quality. Check current listings for comparable granny flats near you before counting on rental income.

Next Steps

1. Check your property – Verify lot size, zoning, and any constraints
2. Get a site assessment – Identify the best location on your lot
3. Design – Work with a designer or use a standard design from a granny flat company
4. Approvals – Lodge CDC or DA as appropriate
5. Build – Engage a licensed builder