How Much Does It Cost to Build an Annex in 2025?
As housing prices continue to rise and families look for more flexible living arrangements, building an annex has become an increasingly popular solution in 2025. Whether it’s for aging parents, adult children, rental income, or simply extra space, annexes—also known as granny flats, garden rooms, or accessory dwelling units (ADUs)—offer a smart, long-term investment. But how much does an annex cost to build?
In this article, we’ll break down the average costs, explore the factors that influence pricing, and offer tips to help you plan your annex project effectively.
What Is an Annex?
An annex is a self-contained living space that is either attached to or separate from the main house. It typically includes a bedroom or sleeping area, a small kitchen or kitchenette, and a bathroom. Some annexes are fully detached buildings (often called garden annexes or ADUs), while others may be converted garages or extensions of the main home.
How Much Does an Annex Cost to Build in 2025?
One of the most common questions homeowners ask in 2025 is: how much does an annex cost to build? The average cost ranges between £30,000 and £120,000 in the UK and $40,000 to $150,000 in the U.S., depending on the annex type, size, and materials.
Here’s a quick breakdown:
| Type of Annex | Estimated Cost (2025) |
| Basic Studio Annex | £30,000 – £50,000 |
| One-Bedroom Garden Annex | £60,000 – £90,000 |
| Two-Bedroom Annex | £90,000 – £120,000+ |
| Luxury or Custom Annex | £120,000 – £200,000+ |
Factors That Affect the Cost
When asking how much does an annex cost to build, it’s important to consider a number of key variables that influence the total price:
1. Size and Layout
The larger and more complex the annex, the more expensive it becomes.
2. Construction Type
Prefab or modular units can be more affordable than custom builds.
3. Location
Urban construction is typically more costly than rural or suburban areas.
4. Utilities and Infrastructure
Hooking up water, power, and sewer lines can increase costs significantly.
5. Foundation and Groundwork
Difficult terrain or soil conditions can raise building expenses.
6. Interior Finishes
Luxury kitchens and bathrooms add both value and cost.
7. Planning and Fees
Planning permission, permits, and architectural design all factor into your total cost.
Do You Need Planning Permission?
In 2025, many homeowners can build an annex under permitted development rights, avoiding full planning permission—especially if the annex meets size and location criteria. However, if you’re building a large structure or planning to rent it out, you’ll likely need approval. Always check with your local authority first.
Additional Costs to Consider
Aside from the main construction cost, keep these extras in mind:
- Architect/design fees: £1,000–£5,000
- Building control inspections: £500–£2,000
- Landscaping and access: £1,000–£10,000
- Appliances and furniture: £3,000–£15,000
- Utilities connection: £2,000–£10,000
- Insurance and potential council tax adjustments
Can an Annex Add Value?
Yes—an annex can increase your property value by 10–20%, especially in areas where space is at a premium. It’s also a great way to generate passive income through long-term or holiday rentals.
Tips to Save Money
If you’re concerned about how much does an annex cost to build, here are some tips to stay within budget:
- Go modular – Prefab units save time and labour costs.
- Stick to basics – Keep the layout simple and avoid over-customization.
- Manage the project yourself – Acting as your own contractor can save thousands.
- Use reclaimed materials – Repurposing can be cost-effective and eco-friendly.
Final Thoughts
So, how much does an annex cost to build? The short answer: it depends. But with a ballpark range of £30,000–£120,000, the right annex can deliver both lifestyle improvements and long-term value.
Whether you’re creating space for a loved one, starting a rental venture, or simply investing in your home’s future, a well-designed annex is a powerful way to make the most of your property. Just be sure to research thoroughly, plan carefully, and consult the professionals where needed to ensure a successful build.
