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Why are Houses with a Granny Annexe Worth More Money?

It’s common knowledge that making developments to your property impacts its market value, whether it’s an annexe build or not. But, what exactly makes houses with a granny annexe worth more money – and just how much of a boost could you expect? Discover the answers in this ultimate guide on the investment value behind annexe construction

The Rising Popularity of Garden Construction

Garden homes have become increasingly popular in recent years, with many recognising the attractive and affordable living options they provide. In this age of rising care costs, ensuring elderly relatives are safe, secure and well-looked after is a growing concern. Rather than just occupying a spare room, self-contained annexes allow their inhabitants to retain a sense of privacy and independence – while still having easy access to support from their loved ones.

As a result, many individuals are exclusively looking for houses with an existing annexe in place. In January 2021, Rightmove – the UK’s leading property portal, reported an 89% rise in the number of people searching for the term annexe. Far from just adding value to your main house, granny annexes also act as enticing selling points for prospective buyers.

Despite this popularity however, those hoping to buy a property with a granny annexe often face disappointment. While demand is high, people who own a high-quality custom garden home tend not to sell up due to their annexe providing them with an ideal living solution.

garden construction

What makes Houses with a Granny Annexe so Popular?

With a rising popularity in searches, you may be wondering – what exactly makes annexes so appealing to potential buyers? As mentioned earlier, garden homes provide owners with a cost-effective option for downsizing – and a far cheaper alternative to extortionate care home fees. However, it’s not just the elderly who can benefit from this additional living space…

Granny annexes also provide a practical solution for families with complex needs. Children with disabilities can benefit from the independent living and on-hand support a garden home provides as well. What’s more – as property prices continue to fluctuate, granny annexes are increasingly being used by young adults as a cheaper first step on the property ladder.

Even if a prospective buyer is interested in a property – but doesn’t need the annexe for a relative, the prospect of a multi-functional living space is still attractive. Whether it’s intended for use as a home gym, garden office – or even as a means of generating monthly income through a lodger, any extra living space is good news for your property value.

How does a Granny Flat impact Property Value?

When it comes to investing in garden home construction, people often consider how it will impact their property value first. Aside from benefiting its inhabitants, building an annexe is a financially responsible thing to do in the long-run. Not only does the annexe’s value increase alongside – and in conjunction with the main house, it also adds value to the overall property.

While it’s hard to say just how much value it will add – as this figure is dependent on a wide range of factors, you can rest assured a granny annexe will most certainly have a positive impact. According to research, it’s estimated you could expect an increase of up to 20-30%.

Property value of houses with a granny annexe

What Factors affect this Rise in Property Value?

As previously mentioned, there are a number of factors that can impact how much value a garden annex will add to the market value of your property. This can largely be summarised into two categories – what you started out with, and the quality of your finish…

If the granny annexe is – in reality, little more than a poorly-constructed shed, it should come as no surprise this won’t have much impact on property value. However – if you’ve chosen a well-designed layout, planned carefully and used the service of a professional, you’re likely to see a much higher return on your investment thanks to the high-quality of your build.

Aside from this, the original value of your property – and where you’re situated in the UK, both have an effect on its market value. Just like standard houses, granny annexes in the South of England will see a much higher hike up in price compared to those in the North.

The Dwindling Supply of Bungalows

Another factor influencing the demand for garden annexes is ongoing issues with the supply of bungalows for ageing family members. As mobility declines, most elderly retirees wish to downsize to a single-storey home to reduce the strain a larger property puts on them. With an ageing population in the UK, it’s no wonder demand for bungalows is on the rise.

In 2020, over 70% of over-65s considered moving to a bungalow – marking a 10% rise from the previous year. Yet – despite such an increase in demand for them, it may shock you to learn that less and less bungalows are being built each year. In fact, only 1,833 single-storey homes were built in 2020 – seeing a 23% fall in provision compared to the year prior.

This means the demand for bungalows currently outweighs the supply, resulting in frequent price increases for this type of dwelling. Complicating the issue more, many bungalows are bought by property developers and converted into multi-storey homes if planning permission allows. As a result, people are increasingly struggling to find bungalows close to their loved ones, or finding that the options available to them are becoming less and less affordable.

Trust in the Granny Annexe Professionals

Whether it’s self-contained accommodation for an elderly relative – or just a little extra space for the family, we can help create the granny annex of your dreams. All our garden annexes are crafted using high-quality, eco-friendly and energy-efficient materials, and provide all the essentials you – or your loved ones, will need for independent living.
From questions on council tax to concerns about planning permission, we’re always happy to share some expert advice on garden rooms. Why not get in touch with our friendly team today and discover how our builds can help give your property value a boost?

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Recent Projects

granny annexe projects

Jenny Haughton

We recently visited the Haughton Family to see how garden annexe living was working out for them. It's safe to say they feel like it was the perfect choice. Watch the video below to hear their expe...
Williamson bespoke granny annexe

Jenny Williamson

The Williamsons family moved into their Annexe over 3 years ago. When visiting the family they told us life in their new home exceeded their expectations for many reasons. So much so, they wanted a...

Wendy Hamm

In Autumn 2020 Wendy Hamm and her family approached iHus as they were contemplating an annexe build in their back garden to house Wendy’s mother. Wendy’s mother Jane, 82, was living over an hours d...


This idyllic annexe is home to Theresa and Austin situated at the bottom of their daughter and son in law’s garden. Having always lived very closely to one another, the family were convinced this w...

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Download our iHus annexe brochure

If you would like to download our annexe brochure please complete the form below. You call also request for a copy to be posted to your home address. Have any further questions, why not request one of our team get in touch?