Compare Your Options
A granny annexe isn't the only way to keep family close. Here's how it stacks up against the alternatives.
At a Glance
| Granny Annexe | House Extension | Care Home | Bigger House | |
|---|---|---|---|---|
| Typical Cost | £90k-£150k | £80k-£200k+ | £57k+/year | £100k-£300k+ |
| VAT | 0% | 20% | Included | Stamp Duty |
| Timeline | 3-6 months | 6-12 months | Immediate | 3-6 months |
| Disruption | Minimal | Significant | None to home | Total upheaval |
| Privacy | Shared space | Limited | Shared space | |
| Independence | Within home | Within home | ||
| Adds Property Value | N/A |
Granny Annexe vs. House Extension
Granny Annexe Advantages
- Zero VAT under Caravan Act (save 20%)
- Complete privacy for the occupant
- Minimal disruption during build
- Faster build (much built off-site)
- Self-contained kitchen, bathroom, living space
- Can be relocated if you move house
House Extension Advantages
- Integrated with main house
- Can be more flexible design
- Permanent structure (brick-built)
- May suit larger plots better
Bottom line: An extension is better if you want extra space within your existing home. An annexe is better if the occupant needs their own independent living space with privacy.
Granny Annexe vs. Care Home
Granny Annexe Advantages
- One-time cost vs. £1,300+/week ongoing
- Full independence with family support nearby
- Own furniture and belongings
- Pets allowed
- See grandchildren every day
- Own schedule and routines
- Adds value to property (asset, not expense)
Care Home Advantages
- 24/7 professional care available
- No upfront capital required
- Social activities and companionship
- Meals and housekeeping provided
Cost Comparison
£57,200
Care home per year (average)
£114,400
Two years in care
£110,000
One-bed annexe (one-time)
Bottom line: If 24/7 nursing care is required, a care home may be necessary. For those who can live semi-independently with family support, an annexe provides better quality of life at a fraction of the long-term cost.
Granny Annexe vs. Moving to a Bigger House
Granny Annexe Advantages
- Stay in your community (schools, friends, doctors)
- Lower cost than moving (no stamp duty, fees, etc.)
- No chain or stressful house sale
- Keep your garden and established plants
- Private space for family member
- Faster (3-6 months vs. uncertain timeline)
Bigger House Advantages
- More overall space for everyone
- Potentially better location
- Fresh start in new property
- May suit different life stages better
Hidden Costs of Moving
Stamp Duty
£10,000-£30,000+
Estate Agent
1-3% of sale
Legal Fees
£1,500-£3,000
Moving Costs
£1,000-£2,000+
Bottom line: Moving makes sense if you want to change area or need significantly more space. An annexe is better if you love where you are and need dedicated, private accommodation for a family member.
When is a Granny Annexe the Best Choice?
A granny annexe is ideal when:
You want to keep a family member close while giving them their own independent space
You're comparing costs with care homes and want a better long-term solution
You don't want the disruption of a major house extension or moving home
You want to save 20% VAT compared to a traditional extension
You have garden space and want to add value to your property
Your family member values their independence but needs nearby support
Not Sure Which Option is Right?
We're happy to talk through your situation and help you work out whether an annexe makes sense.