Small second dwellings are one of the most useful changes to Victorian planning in years. They give families a practical way to house ageing parents, adult children or guests, create a home office, or add rental income, often without the time and uncertainty of a planning permit. Here is how the rules work.
What is a small second dwelling?
A small second dwelling, often called a granny flat, is a self-contained home of 60 m² or less, built on the same lot as an existing house. It can include its own kitchen, bathroom and toilet. The rules were introduced by planning scheme amendment VC253, which took effect on 14 December 2023.
Do I need a planning permit?
In most cases, no. A small second home no longer requires a planning permit where there are no flooding, environmental or other special planning controls affecting the land. If your property is covered by one of those controls, a planning permit may still be needed. Check your planning property report before you commit to a design.
Do I need a building permit?
Yes. A small second dwelling still needs a building permit. The building surveyor assesses siting, amenity, design and safety requirements, as well as structure, energy efficiency and, where relevant, bushfire construction standards.
The key rules
- Floor area: 60 m² or less
- Location: on the same lot as an existing dwelling
- Ownership: cannot be subdivided or sold separately from the main home
- Gas: must not be connected to reticulated natural gas
- Parking: no car parking space required
- Planning controls: flooding, environmental or special controls may still trigger a planning permit
Can I rent it out?
The rules allow a small second dwelling to be used by anyone, not just family. If you plan to rent it, consider tenancy law obligations, the effect on your insurance, and tax advice on rental income and capital gains. Get independent advice on those points.
What to check before you design
- Planning property report: zone and overlays
- Title: covenants and easements that may restrict building
- Site: access for construction, levels, drainage and trees
- Services: capacity to connect water, sewer and electricity, and whether separate metering is wanted
- Siting: setbacks, height and overshadowing of neighbours
- Contract value: work over $10,000 needs a registered builder and a written contract; eligible work over $20,000 needs Home Warranty cover from 1 July 2026
Prefab or site-built?
Both can work. Prefabricated or modular units can shorten time on site, but they still need a building permit, foundations, service connections and a builder to install them. Site-built homes offer more flexibility for sloping sites, tight access or matching the main house.
How AxisPro helps
We help homeowners test whether a small second dwelling fits their site, then design and build it with the right approvals. A feasibility check at the start confirms whether any planning control applies, so there are no surprises after design.