Keep garage or make a separate entrance for the granny flat?

[Linguaphile]

We live in a large house and our top floor is a self-contained 2 bedroom flat which is maybe 70sqm in size. Currently, we only use the space as guest accommodation, but otherwise it goes unused. We have thought about renting the space out as we rarely use it and already have a guest room downstairs, but at the moment it uses the same entrance as the rest of the house. We are thinking about perhaps creating a separate entrance, but to do that, logistically it would mean losing our garage to create the entryway and dividing our driveway so that it’s only for one car instead of two. However, by finishing it off and completely separating it from our living space, we could potentially sell it and release equity. 2 bedroom flats with private parking in our area go for around 600-700k.

Is it better to keep the bigger house with garage and 2 car driveway, or would it be a better idea to split the house and lose the garage to release the equity and perhaps cut down on our environmental footprint by losing living space we don’t use?

You will spend a huge amount on the conversation. That will cut down on your profit. You'll have to separate all the services and put in lots of soundproofing. You'll need to do it to a high standard. The separate entrance will need a lot of stairs up. Would that be off putting? I'd release equity by downsizing rather than have people clumping around over my head.

Don't forget to factor in the loss of value of the main house, if it has a flat above it. And presumably the main house would have no attics for storage? Talk to an estate agent to understand what the reduction in value would be. I'm guessing that not many buyers with the money to buy a good size house (even without the top floor) with a garage will want a flat above them.

I imagine you’d have a 3-4 bed flat left for yourself? Do you know how much that would be worth and would anyone buy it? Or do families looking for 3-4 want a freehold house?

There’s also the consideration that if you sell of the upstairs, and set the flats up as share of freehold, you’ll create a lot of hassle for yourself + you could have a noisy neighbour above you.

If the plan is to just convert the building and sell up to move elsewhere, then it could make you more money.

I don’t think this makes sense as a separate dwelling for reasons given above

Why don’t you try it as an air BnB to see how you feel about other people being in such close proximity?

By the time you have got planning permission , separated out all the services, undertaken the legal work to create two free holds (or would the flat be leasehold?) and done the conversion, you will end up with people coming and going at all times, your privacy compromised, noise, arguments about paying to get the roof fixed or the exterior painted...

I would just downsize.

Yes, you are all right of course! We don’t need the equity really, and as such it would probably be more of a hassle than it’s worth.