Custom built granny flats sound appealing when you’re starting your research. Design exactly what you want, choose every detail, create something unique. However, here’s what most people don’t realize: custom built granny flats typically cost $280,000-$400,000+ and take 8-14 months, compared to premium packages at $220,000-$255,000 completed in 12-16 weeks.
The real question isn’t whether custom built granny flats are inherently better. It’s whether you actually need the level of customization that justifies extra cost, extended timeline, and additional complexity, or if premium packages already provide what you want.
I’ve watched hundreds of Melbourne property owners start down the custom path, only to realize premium packages offer 95% of what they wanted at about 60% of the cost. This guide helps you figure out which option suits your actual needs.
Who Actually Needs Custom Built Granny Flats?
Custom built granny flats solve specific problems that standard packages genuinely can’t handle, but these situations are less common than you might think.
Challenging Sites
Challenging sites are the most legitimate reason for custom granny flat design. If you’re dealing with steep slopes that require split-level construction, extreme access issues that prevent crane delivery of modular units, unusual block shapes or dimensions that won’t accommodate standard rectangular buildings, or heritage properties requiring careful architectural integration with existing buildings, then custom design becomes necessary rather than optional.
Very Specific Functional Requirements
Very specific functional requirements sometimes demand custom approaches. If you need wheelchair accessibility beyond standard compliance (things like custom ceiling hoists, specialized bathroom equipment, or specific room relationships for care needs), home-based business facilities (commercial-grade kitchens, dedicated offices with separate client entries, workshop spaces with specific requirements), or truly unique design visions that can’t be achieved through any modification of standard layouts, custom might be your only path forward.
High-End Property Considerations
High-end property considerations also play a role. On properties valued at $2 million and above, matching the quality and architectural style of your main house often matters enough to justify custom costs. In these situations, visual integration with existing buildings becomes critical, and buyers simply want bespoke granny flat design regardless of cost or timeline because their property demands it.
The Reality Check
Here’s the reality most Melbourne property owners face: if you have a typical 500-700m² block with straightforward access and no unusual site constraints, you almost certainly don’t need custom design. Standard premium packages work beautifully for these situations and deliver exceptional results without the complexity.
Understanding the Custom Design Process
The custom granny flat process takes significantly longer than most people expect.
Initial Concept Phase
The initial concept phase runs 4-8 weeks: meeting with architects, creating preliminary designs, refining through multiple iterations, and settling on a concept everyone agrees on. Furthermore, documentation takes another 6-10 weeks for detailed drawings, structural engineering, permit applications, council submission, and responding to requests for modifications.
Approvals Phase
The approvals phase stretches 8-16 weeks and sometimes much longer. Council assessment periods vary wildly. Additionally, neighbor objections can trigger mediation adding months. Approval conditions often require design changes and resubmission.
Construction
Construction takes 16-24 weeks for site-built custom work, vulnerable to Melbourne weather delays, trade coordination conflicts, variations as issues emerge, and general construction problems.
Total: 34-58 weeks (8-14 months) from starting design to moving in. In contrast, premium packages complete in 12-16 weeks.
Real Cost Comparison Between Custom and Premium
Let’s talk actual money rather than vague estimates, because the cost difference matters enormously for most buyers.
Typical Custom Built Granny Flat at 60m²
A typical custom built granny flat at 60m² breaks down like this: architect fees run $15,000-$25,000 depending on complexity and how many design iterations you need, engineering adds another $5,000-$8,000, planning permit costs $4,000-$8,000 including application fees and consultant reports, and site-built construction itself runs $250,000-$350,000 depending on specifications and finishes. Your total comes to $274,000-$391,000 for a 60m² granny flat.
Our Signature Package
Our Signature package at the same 60m² size includes complete design, engineering, and approvals in the price, factory construction with premium inclusions throughout, and site preparation, installation, connections, and landscaping all complete for $220,000 total.
The Difference
That custom build is costing you $54,000-$171,000 more for comparable size and quality. What are you actually getting for that extra money? Complete freedom in design and the ability to specify every single detail exactly as you envision it. Therefore, for some buyers with specific needs or high-value properties, that flexibility is worth every dollar. For most buyers, it’s a very expensive way to get features that already come standard in premium packages.
When Custom Makes Sense Versus When Packages Win
Custom design makes genuine sense when your site literally won’t accommodate standard packages due to extreme slopes, complete lack of crane access, or truly unusual block dimensions that can’t fit rectangular buildings. It’s also the right choice when you need features that simply aren’t available in any package, like commercial kitchens for home businesses, workshops with specific requirements, or highly specialized accessibility features beyond what standard universal design provides. Additionally, on high-value properties worth $2 million and above, custom design often makes sense for maintaining architectural cohesion across your property.
Premium packages make more sense for the vast majority of buyers (probably 90% or more) when your site is relatively straightforward without major access or slope issues, when you appreciate proven layouts that have been refined through hundreds of projects, when you value cost certainty and knowing exactly what you’ll pay, or when faster completion matters for your family situation or investment returns.
Here’s a reality check I give people all the time: if you’re considering custom primarily because you want stone benchtops, quality appliances, and nice finishes throughout, you’re about to spend $50,000-$100,000 extra for features that come standard in good premium packages. Similarly, if you’re thinking about custom just to get 65m² instead of 60m², ask yourself if that extra 5m² is really worth six months additional time and tens of thousands of dollars more.
However, if you genuinely need split-level construction for a steep site, or you’re building on a $2.5 million heritage property where architectural integration is critical, or you have specific business or accessibility requirements that packages can’t accommodate, then custom is absolutely your best path forward.
Working with Architects for Custom Design
If you determine custom design is necessary, choosing the right architect becomes critical.
Look for granny flat architects with granny flat experience rather than general residential architects. Secondary dwellings involve different planning complexities, tighter site constraints, and stricter budget limitations.
When interviewing architects, ask how many granny flats they’ve designed in Melbourne (you want 10+ completed projects), what their typical fee percentage is (12-15% of construction cost is standard), whether they have relationships with granny flat builders, and if they can provide references.
Get scope and fees in writing. Your agreement should specify what’s covered in concept design, documentation, permit preparation, and site visits. Furthermore, good architects save money through efficient designs and proper documentation. Bad architects cost you through endless changes and permit delays.
How Much Custom Built Granny Flats Actually Cost
Custom granny flat costs in Melbourne vary widely based on how much you’re actually customizing and what site conditions you’re working with.
Basic custom builds run $280,000-$320,000 for 60m². You’re essentially paying custom prices for minor layout tweaks to standard designs. At these price points, premium packages at $220,000-$255,000 almost always provide better value unless you have very specific reasons for those particular modifications.
True custom design with significant architectural input costs $320,000-$380,000 for 60m². This is genuine custom work with specific features designed for your needs. It’s worth the cost if you actually need those specific features, but not if you’re paying for custom design to get finishes that come standard in quality packages.
Luxury custom builds run $380,000-$500,000+ for 60-80m². These involve imported materials, excessive specifications beyond what performance requires, and architectural statements. Consequently, they make sense on very high-value properties but rarely deliver proportional value for typical Melbourne homes.
Site difficulties add substantial costs on top of base pricing. Steep slopes add $20,000-$40,000 for additional engineering and construction complexity. Access challenges add $15,000-$30,000 for special equipment or hand-carrying materials. Moreover, heritage requirements add $10,000-$25,000 for specialized approvals and construction methods.
Don’t forget the hidden costs in custom builds. Variations during construction typically add 10-15% above quoted prices. Extended timelines cost you delayed rental income if you’re investing. Your time managing the project has real value that you need to factor into total costs.
Timeline Reality: Custom Takes Three Times Longer
The timeline difference between custom and premium packages matters more than most people initially realize, especially when you factor in real-world impacts.
Custom builds run about 12-14 months total: 2 months for concept design where you’re working through ideas with architects, 2 months for documentation to prepare permit applications, 3-4 months for approvals as council processes your application, and 5-6 months for site-built construction. That’s a year or more from starting design to moving in.
Premium packages complete in 12-16 weeks: 1-2 months for design finalization and CDC approval (these happen concurrently), 6-8 weeks for factory construction (which happens at the same time as site preparation), 3-5 days for crane installation, and 2-3 weeks for final connections and landscaping.
For investors, that 10-month difference means 10 months of rental income you’re missing. At $500 weekly rent, that’s $21,600 in lost income, which alone covers a huge portion of any price difference between custom and premium packages. Learn about maximising rental income.
For families building for elderly parents or adult children, 10 months earlier completion means your family situation improves nearly a year sooner. Parents get care sooner. Kids get independence sooner. Therefore, that has value that’s hard to quantify but very real. Explore multi-generational living solutions.
For everyone, 10 months less disruption to your property, less construction stress, and faster return to normal life represents significant quality of life improvement. Time has value beyond just money.
Investment Returns Favor Premium Packages Heavily
The investment math strongly favors premium packages.
A premium package costing $220,000 that rents for $480-$520 weekly generates $24,000-$26,000 annually, producing 10.9-11.8% gross yield. In contrast, a custom build costing $320,000 renting for the same amount produces only 7.5-8.1% gross yield.
Custom builds don’t rent for meaningfully more despite costing $100,000 extra. Tenants pay for quality and location, not architectural uniqueness. Furthermore, property value increases follow similar patterns: premium packages add $90,000-$120,000, similar to custom unless the design specifically enhances high-value property architecture.
Why Most Buyers Choose Our Premium Packages
After helping hundreds of Melbourne property owners work through this decision, the vast majority choose premium packages, and here’s why.
Cost certainty eliminates stress. Fixed pricing means $220,000 or $255,000 is what you pay. In contrast, custom builds regularly exceed budgets through variations and unforeseen issues.
Timeline certainty helps planning: knowing completion happens in 12-16 weeks lets you plan when parents move in or when to start advertising for tenants.
Quality consistency comes from factory construction meeting the same high standards every time. Site-built quality varies by trades and weather. Additionally, proven designs work better than untested layouts refined through hundreds of projects. Custom designs sometimes create problems only apparent after months of living with them.
Stress reduction matters. Premium packages are straightforward: sign contract, make finish selections, we handle everything. Custom builds require constant decisions, design reviews, and problem-solving throughout.
Conclusion
Custom built granny flats make sense for buyers with genuinely challenging sites, very specific functional requirements, or high-value properties requiring architectural integration, but these situations represent maybe 10% of Melbourne projects. The other 90% of property owners benefit more from premium packages delivering exceptional quality at $220,000-$255,000 with completion in 12-16 weeks, versus custom builds costing $280,000-$400,000+ taking 8-14 months.
Moreover, our Luxe package already includes many features buyers assume require custom design. Investment returns favor premium packages significantly through better yields and earlier rental income. Contact Innovista Group to discuss whether your project genuinely requires custom design or if our premium packages already provide everything you actually need. Additionally, request your free site assessment to explore your options.
