The short answer
- The annexe is paid for up front, the care home week by weekIn our illustration a one-bedroom annexe costs £100,000 before any care. A residential care home place costs about £60,320 a year.
- With visits, the annexe catches up in two to three yearsA morning and evening visit costs £273 a week on PrimeCarers. The gap against the care home fee pays back the build in about 2 years.
- With a live-in carer, the weekly costs are closeA typical live-in week is £1,120, against about £1,160 for a residential place, so the build does not pay for itself in any useful time. Against a nursing home it takes about 9 years.
- The money is not the only differenceThe figures leave out household bills, what the annexe adds to the house, and how the council means test treats each choice. Those can move the answer either way.
Care at home figures are what carers on PrimeCarers charge, with our fee included. Agencies charge £28 to £35 an hour for a visit. Build figures are a published 2026 cost guide's ranges, not a quote, and care home figures are our published comparison figures, not a price from any home.
If you are weighing up whether to build somewhere for your mum or dad at the bottom of the garden, or to look for a care home, the cost is one of the first things you will want settled. This page sets the two side by side over five years, using figures you can check, and then goes through what those figures cannot show. For the wider question of which suits your parent, start with care at home or a care home, and the granny annexes guide covers everything from finding a house with one to planning permission.
Five years side by side
What an annexe with care and a care home cost over five years
The table adds up what each arrangement has cost by the end of each year. The annexe rows start with the build, and the care home rows start at nothing and climb faster.
| Arrangement | After 1 year | 2 years | 3 years | 4 years | 5 years |
|---|---|---|---|---|---|
| Building an annexe, then paying for care in it | |||||
| Annexe, with an hour of care every morningOne-bedroom annexe at £100,000, then 7 hours of visits a week at £19.47 an hour: £136 a week. | £107,087 | £114,174 | £121,261 | £128,348 | £135,435 |
| Annexe, with a morning and an evening visitOne-bedroom annexe at £100,000, then 14 hours of visits a week: £273 a week. | £114,174 | £128,348 | £142,522 | £156,697 | £170,871 |
| Annexe with a second bedroom, and a live-in carerTwo-bedroom annexe at £135,000, so the carer has a room of their own, then a typical live-in week of £1,120. | £193,240 | £251,480 | £309,720 | £367,960 | £426,200 |
| Moving into a care home | |||||
| Care home, residential placeNo build. About £1,160 a week, our published comparison figure for a residential place. | £60,320 | £120,640 | £180,960 | £241,280 | £301,600 |
| Care home with nursingNo build. About £1,410 a week, our published comparison figure for a nursing place. | £73,320 | £146,640 | £219,960 | £293,280 | £366,600 |
Illustrative only. The build figures are the middle of MyJobQuote's September 2026 ranges for a new annexe (£90,000 to £110,000 for one bedroom, £120,000 to £150,000 and up for two), before professional fees, groundwork, connections and VAT. Care at home uses £19.47 an hour and a £1,120 live-in week, what carers on PrimeCarers typically charge with our fee included. Care home figures are our published comparison figures, not a quote from any home. Food, energy and council tax for the annexe are not included; a care home fee already covers them.
When the annexe with visits becomes the cheaper optionSection titled When%20the%20annexe%20with%20visits%20becomes%20the%20cheaper%20option
If your parent needs help getting up, washed and dressed each morning and nothing much more, the build is almost the whole cost. Seven hours of visits a week is £136 on PrimeCarers, against about £1,160 for a residential care home place. By the end of the second year the annexe and visits come to £114,174, and the care home to £120,640. From there the annexe pulls further ahead each year.
With a morning and an evening visit every day, the crossing point moves a little later. After two years the annexe and visits have cost £128,348 against £120,640 for the care home, and after three years £142,522 against £180,960. By year five the gap is £130,729.
Why a live-in carer changes the pictureSection titled Why%20a%20live-in%20carer%20changes%20the%20picture
A typical live-in week on PrimeCarers is £1,120 with our fee included, which is only a little below the £1,160 residential figure. The weekly saving is too small to pay back a building, and a live-in carer needs a bedroom of their own, so the annexe in that row has two bedrooms and costs more to build. After five years it has cost £426,200, against £301,600 for a residential place and £366,600 for a nursing place.
That does not make live-in care in an annexe a poor choice. It means the case for it rests on something other than saving money: your parent having one carer and their own front door, close to family. If live-in care is what your parent needs, it can also happen in the home they live in now, with no build at all. Is live-in care cheaper than a care home? has a calculator for that comparison on your own figures, including the house, pensions and savings.
What the build figures are based onSection titled What%20the%20build%20figures%20are%20based%20on
The build figures are the middle of MyJobQuote's September 2026 ranges for a new annexe: £90,000 to £110,000 for one bedroom with its own kitchen and bathroom, and £120,000 to £150,000 or more for two. The Garden Room Guide's survey of specialist suppliers puts a one-bedroom annexe at £70,000 to £115,000. Professional fees, groundwork and mains connections can add £6,048 to £28,548, and an annexe build is normally charged VAT at the standard 20% rate. How much it costs to build a granny annexe sets out every range and its source, including the cheaper route of converting a garage.
What the figures leave out
What a care home fee covers that an annexe does not
A care home fee pays for a room, meals, heating and staff on shift. Care at home pays for the carer's time and nothing else. The table compares the bills you would definitely face, so a few costs and gains sit outside it.
Food and household bills
Extra in the annexe
Repairs and insurance
Extra in the annexe
The house your parent leaves
Either way
Nursing and night care
Changes the comparison
None of these change the main shape of the table. A parent who needs a visit or two a day costs much less to care for in an annexe once it is built, and a parent who needs someone on hand around the clock costs about the same either way. Where they matter is at the edges. A household that pays its own energy and food bills may find the annexe takes longer to catch up. A family who sells the house later, with a well-built annexe in the garden, may get a good part of the build back.
Care home per week against home care per week sets the household bills against a care home fee in more detail, using the national figures for council tax and energy.
Who each one suits
Who an annexe suits, and who a care home suits
The rows in the table describe different people as much as different prices. A parent who manages well with two visits a day is not the person a care home is set up for, and a parent who needs nurses through the night is not well served by visits.
An annexe with care at home tends to work when
- Your parent wants their own front door and their own routine, close to the family
- Help with washing, dressing and meals at set times covers most of what they need
- Someone in the main house can answer a call or an alarm at night while nights are quiet
- The family expects to stay in the house for several years, so the build has time to pay back
- There is room for a second bedroom if a live-in carer may be needed later
A care home may be the better choice when
- Your parent needs nursing care that district nurses cannot cover at home
- Nights are unsettled and nobody in the main house can be on call every night
- They want company around them all day, and a home offers that more easily
- The family may need to move within a year or two, before an annexe has paid back
- They have said clearly that they would rather move into a home
Timing matters as much as the money. An annexe takes months to plan, get approved and build. If your parent needs help now, care can start in their current home while the annexe is being built: hourly care for visits, or a live-in carer if they need more. When home care stops being enough goes through the signs that a care home has become the safer choice.
It also helps to think about what happens if your parent's needs grow. An annexe can take more care over time: a lunch visit, then a carer at night, then a live-in carer. Care in a granny annexe sets out how care can build up in an annexe and what each step costs. A residential care home may need to be followed by a move to a nursing home later, which means a second move and a higher fee.
The means test
How the council's means test treats each option
If your parent's money runs low, the council may help pay for their care after a financial assessment. The rules treat a parent living in an annexe differently from a parent in a care home, and the money spent on a build can be questioned.
| Living in an annexe, with care at home | Living in a care home | |
|---|---|---|
| The home they live in | Not counted. The value of a person's main or only home is disregarded when they receive care somewhere other than a care home. | Their former home is counted once the move is permanent, after a 12-week disregard, unless someone such as a partner or a relative aged 60 or over still lives there. |
| Savings and investments | Counted. Above £23,250 your parent pays in full. Below £14,250 savings are ignored. | Counted in the same way, with the same £23,250 and £14,250 limits in England. |
| Money spent on the build | May be questioned if the council thinks avoiding care charges was a significant reason for spending it when it was spent. | The same rules on deprivation of assets apply. |
| Attendance Allowance | Paid as normal if your parent qualifies. | Usually stops if the council pays for the care home. It carries on if your parent pays all of their care home fees themselves. |
The home they live in
- Living in an annexe, with care at home
- Not counted. The value of a person's main or only home is disregarded when they receive care somewhere other than a care home.
- Living in a care home
- Their former home is counted once the move is permanent, after a 12-week disregard, unless someone such as a partner or a relative aged 60 or over still lives there.
Savings and investments
- Living in an annexe, with care at home
- Counted. Above £23,250 your parent pays in full. Below £14,250 savings are ignored.
- Living in a care home
- Counted in the same way, with the same £23,250 and £14,250 limits in England.
Money spent on the build
- Living in an annexe, with care at home
- May be questioned if the council thinks avoiding care charges was a significant reason for spending it when it was spent.
- Living in a care home
- The same rules on deprivation of assets apply.
Attendance Allowance
- Living in an annexe, with care at home
- Paid as normal if your parent qualifies.
- Living in a care home
- Usually stops if the council pays for the care home. It carries on if your parent pays all of their care home fees themselves.
England. Sources: the Care and Support Statutory Guidance, chapter 8 and Annexes B and E, and gov.uk's Attendance Allowance eligibility page, both checked October 2026. Scotland, Wales and Northern Ireland have their own rules.
The disregard of the home is one reason families look at an annexe at all. If your parent sells their house and moves into a care home, the money from the sale counts as savings and pays the fees until it falls to £23,250. If they move into an annexe instead, care at home is assessed on their income and savings, and the annexe they live in is not counted.
A parent with savings above the upper limit pays for their own care either way. Self-funding care explains what that involves, and if your parent may need the council's help, local authority funding explains how to ask for a care needs assessment and a financial assessment. Both are free to ask for.
Your own figures
How to work out the figures for your own family
The table uses one build figure and one level of care. Your own comparison needs your builder's quotes and an idea of the care your parent needs, and both can be found without committing to anything.
- 1
Ask the council for a care needs assessment
FreeA social worker or occupational therapist looks at what your parent can and cannot do and writes down the help they need. That tells you which row of the table to read, and it opens the door to council funding if your parent's savings are low. - 2
Get quotes for the build
Three builders or suppliersAsk for a fixed price that names what is included: foundations, connections, the kitchen and bathroom, and VAT. Check whether you need planning permission before anything is designed. - 3
Price the care at home
Free to lookLook at our pricing and the live-in care guide for what visits and a live-in week cost, then search for carers near you and compare their own rates. Every carer has had an ID check, a right to work check, an enhanced DBS check (or PVG in Scotland, Access NI in Northern Ireland) issued within the last two years, and an online interview. We do not check qualifications, training or references, so ask carers about those yourself. - 4
Talk to two or three care homes
Ask for the fee in writingFees differ from one home to the next. Ask each home for its weekly fee, what it includes and what it charges extra for, and whether it accepts council-funded residents if your parent's money runs low. - 5
Take advice on the money before you build
Before you signA solicitor for who owns what, and an independent financial adviser for how the build and the care will be paid for over several years. Do this before your parent hands over any money.
Once you have a build quote and a care needs assessment, the comparison is simple arithmetic: the build, plus the weekly cost of care multiplied by 52, against the care home's weekly fee multiplied by 52. When you are ready to put a figure on the care, look at our pricing for what visits and live-in care cost, read the live-in care guide if your parent may need someone around the clock, and then search for carers near you and compare their rates. The care cost calculator shows what each kind of care costs where you live.
Questions
Questions families ask about annexes and care homes
Over several years it can be, if your parent needs a visit or two a day. In our illustration a one-bedroom annexe at £100,000 plus a morning and evening visit every day has cost less in total than a residential care home place by the third year. If your parent needs a live-in carer, the weekly costs are close (about £1,120 against £1,160), so the build does not pay for itself against a residential home.
It depends on how much care your parent needs. With an hour of care each morning, or a morning and an evening visit, our illustration pays back the build against a residential care home in about two years, a little sooner with one visit and a little later with two. With a live-in carer it takes about 9 years against a nursing home and does not happen within any useful time against a residential one. Your own builder's quote will change these figures.
Not while your parent lives in it and receives care there. The Care and Support Statutory Guidance says the value of a person's main or only home is disregarded when they receive care in a setting that is not a care home. Their savings and income are still counted. Money they spent on the build can be questioned if the council believes avoiding care charges was a significant reason for spending it.
Not if the annexe is the main home of a dependent relative of someone living in the main house, which includes a relative aged 65 or over. Other relatives living there get a 50% discount. You have to apply to the council. Is a granny annexe subject to council tax explains who qualifies.
Yes, if the annexe has a bedroom the carer can use as their own, and the carer can take their daily break. For a parent in a one-bedroom annexe, that means building a second bedroom, which is why the live-in row in our table uses a two-bedroom annexe. Preparing the room for a live-in carer covers what the room needs.
Care can start in the home they live in now. Visits cost £18 to £25 an hour on PrimeCarers with our fee included, and live-in care is £1,050 to £1,400 or more a week. The same carer may be able to carry on once your parent moves into the annexe, if they are willing to travel to the new address.