Last updated October 2026
These granny flat FAQs for Melbourne homeowners answer the questions we hear most, from permits and prices to design, build times and renting. Each answer is short and links to a detailed guide if you want to go deeper. Then book a free site assessment to confirm what your block allows.
This guide is general information only and is not tax, legal or financial advice. Speak with a registered tax agent and a licensed finance professional about your situation.
Key takeaways
- In Victoria, a granny flat of 60m² or less is a small second dwelling and usually does not need a planning permit.
- A building permit is required for every granny flat, and it cannot be subdivided or sold separately.
- A turnkey G-Flat™ costs $198,000 to $265,000, depending on the finish level.
- A G-Flat™ takes approximately 5 months end to end.
- You can rent a granny flat out, but tenancy laws apply and renting can affect your tax position.
Granny flat FAQs for Melbourne homeowners: rules and permits
What is a granny flat in Victoria?
In Victoria, a granny flat is called a small second dwelling. It is a self-contained home of 60m² or less, with its own kitchen, bathroom and toilet, built on the same lot as an existing house. Read our guide to small second homes in Victoria for the full picture.
Do I need a planning permit?
In most residential zones, no. Since 14 December 2023, a small second dwelling generally does not need a planning permit. You may still need one if your lot is under 300m² or affected by an overlay, such as heritage, bushfire or flooding controls. The Victorian Government small second dwellings page sets out the official rules.
Do I need a building permit?
Yes. Every small second dwelling needs a building permit, which covers siting, design and safety. With a G-Flat™, the building permit and all required reports are included in the price. See granny flat approvals in Victoria for how the process works.
Is my block suitable?
It depends on available space, construction access, slope, easements, trees and any overlays or covenants on your title. It is one of the most common granny flat FAQs in Melbourne, and a free site assessment answers it for your block. Our guide on what makes a block suitable for a granny flat explains what we look for.
Can I subdivide or sell the granny flat separately?
No. A small second dwelling cannot be subdivided or sold separately from the main home. It stays on the same title.
Is a granny flat the same as a duplex or dual occupancy?
No. Building two or more dwellings on a lot generally needs a planning permit in Victoria’s residential zones, and may open the door to subdivision. A small second dwelling is a simpler project with different rules. Our granny flat vs duplex comparison walks through the differences.
Cost
How much does a granny flat cost in Melbourne?
Every G-Flat™ is a 60m², two bedroom turnkey build with a fixed price for each finish level.
| Finish level | Turnkey price |
|---|---|
| Affordable | $198,000 |
| Homestead | $208,000 |
| Signature | $238,000 |
| Luxe | $265,000 |
Prices are a guide only and depend on your site. Sites 70km or more from the Melbourne CBD attract a 12.5% regional surcharge. A free site assessment confirms the price for your block.
For a full breakdown, read our guide to granny flat pricing in Victoria.
What is included in the price?
Every G-Flat™ includes the building permit and all required reports, all plans, connection of services up to 10m from the main house, stone benchtops, soft-close cabinetry, SPC hybrid flooring, double-glazed windows, Colorbond fascia and guttering, a reverse cycle split system, a 10-year structural warranty and a 6-month maintenance guarantee. Our granny flat inclusions in Melbourne guide lists each item.
What could add to the cost?
Site factors are the main ones. Services that need to run further than 10m, sloping ground, overlays and easements can all add work.
How do people pay for a granny flat?
Most owners use savings, equity in their home or a construction loan. A mortgage broker can tell you what suits you.
Design
What floor plans are available?
There are five G-Flat™ floor plans, all 60m² with two bedrooms:
- Stella: L-shaped, suits corner and irregular blocks.
- Aurora: long and narrow, suits tight and side-access blocks, with a walk-in robe in bedroom one.
- Lana: a balanced layout that fits most backyards.
- Lana 2: adds a second bathroom.
- Sirius: square, with large 4 x 3m bedrooms and an L-shaped kitchen.
All plans cost the same within a finish level. See every G-Flat™ layout and finish explained.
Which finish level should I choose?
It comes down to budget and how you will use the home. Affordable is a complete home. Homestead adds a concrete slab, pitched tile roof and rendered Hebel facade. Signature and Luxe add upgrades such as skylights, larger decks and premium appliances. Compare the top two in Luxe vs Signature.
Can a granny flat have gas?
No. A small second dwelling cannot be connected to reticulated gas, so appliances are electric. Every G-Flat™ includes a reverse cycle split system.
Can I build a two storey granny flat?
Every G-Flat™ is designed as a practical, easy-to-access home for ageing parents and young families alike.
Building process
How long does it take to build a granny flat?
A G-Flat™ takes approximately 5 months end to end, from planning through to handover. That includes the building permit, approvals, construction and connection of services.
What are the main steps?
- Free site assessment of your block.
- Choose your floor plan and finish level.
- Sign your contract with a confirmed price.
- Building permit and reports.
- Construction and connection of services.
- Final inspection and handover.
Our step by step guide to building a granny flat in Victoria explains each stage.
Do I need to organise the permits myself?
No. The building permit and all required reports are part of the G-Flat™ turnkey price, so you deal with one team from site assessment through to handover.
Can I see a G-Flat™ before I commit?
Yes. Many granny flat FAQs for Melbourne homeowners are easier to answer in person, so walk through our display G-Flat™ to see the layout, finishes and room sizes.
Granny flat FAQs in Melbourne: renting and tax basics
Can I rent out my granny flat?
Yes. Anyone can live in a small second dwelling, including family members or unrelated tenants. If you rent it out, residential tenancy laws apply, including rental minimum standards. Read how to legally rent out your granny flat in Victoria.
How much rent can a granny flat earn?
Rents vary by suburb, finish and demand, so we do not publish rental estimates. A local property manager can give you a rental appraisal for your property.
Is rental income taxed?
Rent from tenants is generally assessable income, and some related costs may be deductible. Your accountant can confirm what applies. See tax deductions for granny flat investments for the general rules.
Does renting it affect capital gains tax?
It can. The ATO explains that renting out part of your home can mean you are not entitled to the full main residence exemption. Read the ATO guide to using your home for rental or business and get advice before you build.
What happens to the granny flat if I sell my home?
It is sold with the main home as one property, because it cannot be sold separately.
Frequently asked questions
Do I need council approval for a granny flat in Melbourne?
Usually you just need a building permit. A planning permit may be needed for lots under 300m² or where an overlay applies.
Can my parents or adult children live in the granny flat?
Yes. A small second dwelling can be lived in by family, friends or tenants.
Does the floor plan change the price?
No. All five G-Flat™ floor plans cost the same within each finish level.
Where do these granny flat FAQs for Melbourne homeowners apply?
They cover Victoria’s rules, so they also apply in regional areas. Sites 70km or more from the Melbourne CBD attract a regional surcharge.
Still have a question?
If these granny flat FAQs for Melbourne homeowners did not cover your question, talk to us about your block. Book your free site assessment or visit our display G-Flat™.