Planning the cost-effective cottage

There are many reasons for home owners to decide to build a cottage in the garden.

They might want to accommodate guests, grown children or retired parents, for example. If they are empty-nesters they might want to live in it themselves and rent out their house. They might want space for a studio or a new home-based business. And these days, they may be looking at the cottage itself becoming a "business", via Airbnb or similar booking services.      

 And the existence of a separate cottage or even a "granny suite" with its own kitchen and bathroom can add considerable value to a house when the time comes to sell it.

However, there are some important checks to be made before you call in the builder. You need to make sure, for example, that local authority zoning regulations allow a "second dwelling" on your stand, and that your plans would not infringe building line or servitude restrictions.

Next you really should check with a knowledgeable local estate agent whether your proposed addition would be cost-effective, in the sense that you would be able to recoup the cost of the build if you were to sell the property. This might not be the case if the value of your existing home is already close to the current market ceiling for your area. 

Of course the proposed design and size of your cottage are also major considerations, because a building that spoils the view from your veranda or encroaches on your outdoor entertainment area, for example, could even reduce the attractiveness - and saleability - of your current home.

Access should also be a concern, along with security. It is usually better if the cottage has a separate entrance and separate parking, but then you need to make sure that these will not compromise the security of the property as a whole.  

And, finally, if you do intend to let the cottage either long-term or part-time to travellers and holidaymakers, you should be reasonably sure that it will generate sufficient income to cover any additional income tax you have to pay - and any additional monthly repayment if you take a further advance on your home loan to cover the building costs.