The granny flat boom has taken off

Granny flats are the latest trend to hit the real estate market in Australia. A granny flat is a separate building within your property which you can use for multiple purposes like a guest room, home office, studios or library, among others.  However popular they are, there is a another option – the cabana. 

Aesthetically and fundamentally, there is no difference between a cabana and a granny flat. Both can be designed to add value to a property and both can be customised to fit your budget and available space.

Why Are Australians looking for alternatives?

Real estate in Australia has always been high priority with over two-thirds of Australians owning their own home. Since 2013 up to today, real estate prices in Sydney have been experiencing soaring property rates by as much as 30%. As of October 2014, the average price for a house in Sydney was pegged at $800,000. House prices have since jumped 3.6 per cent in three months to a median of $914,056. Property owners in Sydney now have to pay higher taxes prompting them to maximize the land with granny flats.

The reasons for the spike in value according to experts are the speculative investment, increase in Asian investors, and the negative gearing tax break. In the past months, thousands of property owners have been seen rushing to add value to their property - as much as $150,000 value – with these independent structures. What many don’t realise is that it costs more to build a granny flat than it does to build a cabana.

How you can take Advantage of This Boom.

For those of you that would love a granny flat, yet, just can’t afford one. The backyard cabana is a simpler and more cost effective option. A cabana or granny flat can cost anywhere from a few thousand to hundreds of thousands of dollars depending on your design and features. Those in-the-know understand why choosing a cabana is a better option than the granny flat.

  • There is a maximum 60 square meter area for a granny flat
  • Cabanas DO NOT require council approval which means you can start work on your cabana immediately instead of waiting for the local council to approve your request for a granny flat.
  • There are DIY kits  available where panels can be bought pre-assembled
  • A basic cabana can be up and ready for use in 24 hours
  • Costs for building your cabana is much, much lower than a granny flat
Mod Cabana no writing.jpg


Since there is more freedom with the cabana compared to the highly structured and monitored granny flat, they are often used to::

  • Generate additional income to cover all or part of a major monthly expense

  • Provide temporary overflow accommodation e.g. you might offer the cabana to your married child or single adult child while they save up for their own home. 

  • Eventually convert it into a granny flat with retrospective approval and rent it out. Even small Granny flats pay a return of over $300 per week.


Doing It Right

Why go through the hassle of meeting the requirements to building a granny flat? A property with a granny flat that does not have the legal compliance documents will not increase value. In fact, you will have a major problem with the local government agency not to mention the possibility of having to demolish or spend on renovations on the granny flat to be compliant with the council’s criteria.


To help you do it right, there are pre-approved designs for cabanas, garden rooms, sheds and workshops that make the process simpler. These designs can be adjusted to create a customized look and design. You do not have to limit your options to what is available as there are high quality, Australian-made pre-fab kits available and professionals who can make adjustments to conform to your design and even construct the cabana for you. There are endless possibilities in designing this kind of cabana including adding a bathroom, kitchen, garden, porch, or patio. You can even make it energy efficient with solar panels and other smart home technology.

The team you hire should also be able to offer you warranty on the job and make sure detailing is done to perfection. This way, if you ever decide to sell the property, the cabana will become one of the main attractions and could even generate the most interest to potential buyers. Increase your home’s value and unique selling point and get on board with Australia’s granny flat boom. A no council approved cabana may certainly help out your situation.

For more small space living ideas take a look at six uses for shipping containers and six reasons micro-homes are going to explode onto the market.

Author bio:

John Chesterfield is the main man when it comes to backyard studios, he is the operations manager at Melwood Cabanas and Garden Rooms. Running a third generation family business in Sydney which specialises in the ultimate outdoor cabana, he is passionate out home ownership and property. When not helping out Aussies fulfil their dream of owning their own backyard shed, you can find him belting out tunes on his favourite guitar.

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