Building a Garage Apartment on a Budget

Ginny Bartolone
Written by Ginny Bartolone
Updated October 28, 2021
Garage living area with TV
Daniilvolkov - stock.adobe.com

Is your garage currently home to five paint cans, an old toolbox, and dusty boxes of holiday decor? Look again—this big open space holds endless opportunities, including a new living space.

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Whether it’s attached to the side of your home or sitting at the end of your driveway, a garage holds endless potential when transformed into a separate living space. But the average cost to turn a garage into an apartment can run upwards of $86 per square foot, which is no small investment. However, you can keep a few budget-friendly alternatives in mind to create both a safe and comfortable space for your guests, tenants, or home-from-college kids.

9 Budget-Friendly Garage Apartment Design Ideas

You'll find quite the wide price range when looking at garage conversion plans, varying anywhere from $5,700 to $22,600. We recommend always building your budget from the ground up—starting with necessary and unavoidable fees.

For example, your town or state likely requires you to pay for permits, zoning fees, and inspection costs to start construction. Budget about $1,400 for these costs.

Your local building codes will also dictate what constitutes a safe living space, including the following requirements:

  • Insulation at $1 per square foot

  • Egress doors and windows, coming in at $1,140 and $1,000 each, respectively

  • Proper bathroom plumbing at about $3,000

If your garage already comes equipped with basic electrics, plumbing, and windows, you're ahead of the game. But what about adding separate walls, a kitchen, and all the details that will make the space feel cozy? Let's look at some cost-friendly ideas that don't sacrifice quality.

1. Opt for an Open Floor Plan

The easiest way to keep costs low on your garage apartment is to stick to as open a floor plan as possible. Studio apartments can contain the same amenities as a one or two-bedroom without the additional walls. Keeping the kitchen, bedroom, and dining area connected also allows more light to filter through the space.

2. Position the Rooms Properly

Expect to pay about $1,100 to add plumbing to your garage and $3,000 for a full bathroom. In most cases, the new plumbing will attach to the existing system in your main house. So, if you add the garage kitchen and bathroom plumbing to the wall closest to your home, you'll likely spend less on materials and labor to bridge the gap.

3. Work with Existing Electrics

Here's some good news: Most garages already come with basic electrical wiring. Work with an electrician to add simple overhead lighting and properly placed outlets for necessary appliances. 

Minor upgrades like track or recessed lighting are also a great way to transform an industrial garage space into a welcoming home without breaking the bank.

4. Get Creative with Storage

Don't have enough room to add a closet and a pantry? The modern style encourages simplistic storage options such as built-in shelves and exterior kitchen racks. Premade built-in bookshelves can cost as low as  $1,270, with materials and labor included. On the other hand, the average cost to add a custom closet is nearly double this price, and it isn't ideal if you're low on square footage.

Professional installing laminate flooring
Andrey Gonchar - stock.adobe.com

5. Consider Cost-Friendly Floors

While you can opt for an industrial-chic look with low-cost polished concrete floors, you may not get the cozy vibe that you're going for. Still, there are plenty of budget-friendly flooring options that can tip the scales of your overall garage budget. For example, consider:

  • Laminate floors at $3 to $10 per square foot

  • Vinyl and linoleum at $3 to $7 per square foot

  • Carpeting at $3.50 to $11 per square foot

Keep in mind that carpeting may be trickier to keep clean and fresh over time, adding to maintenance costs.

6. Know Your Wall Materials

If you do opt to add a wall, you have your pick of the following main materials:

  • Sheetrock

  • Drywall

  • Shiplap

While sheetrock and drywall cost the least and are easier to paint your color of choice, shiplap adds a bit of character to the space. It may even hold up longer against moisture and damage—both of which are concerns in a garage. Keep in mind that wall installation costs an average of $1,900.

7. Add a Kitchenette

While a cooking space is a must-have in an apartment, keep costs low by considering a quaint kitchenette for minimalist living. This mini version of a kitchen tucks into a smaller space, and while it may skip some major appliances like a dishwasher, it typically includes a small stove, fridge, and oven. 

Simple kitchenettes with plumbing typically cost around $5,000 to install, which is much more affordable than a fully fitted kitchen.

8. Add a Movable Island

If you're working with an open floor plan—or even if you've opted to add a bedroom—separate the kitchen and living room with something as simple as a kitchen cart. Kitchen carts work similarly to kitchen islands but are easier to move when you need to clear away the area. You can even find rolling cart models for as low as $100

If you have a bit more space to fill, premade kitchen islands can run between $100 and $2,000 if you don't take the custom one. While this is a larger investment than leaving the space open, the small addition creates a designated kitchen prep and seating space.

9. Fill the Space with Light

One of the biggest challenges of transforming a garage is finding ways to make the space feel less cavernous. It was not, after all, initially built for someone to curl up with a book or sit down to dinner.

Adding natural light is an easy fix for creating a homier feel. More air and natural light also help you meet building codes and add value to the space. 

As we mentioned above, the avenge cost to add a window is about $1,000. However, if your apartment sits on the second floor of your garage, you could come up against slanted ceilings. Consider a skylight window for an average of $1,600, according to HomeAdvisor, or a dormer window to change the exterior look of your garage.

While dormers can cost quite a bit more—$12,000 on average—they could open up the second floor to more possibilities while adding value to your garage.

FAQs About Building a Garage Apartment on a Budget

Taking on such a large project is bound to bring up some common questions as you get started. Remember to lean on your local garage remodeler for help along the way. Local pros will be able to answer crucial questions and make suggestions for the best use of your time, money, and design efforts. Here are some of the most commonly encountered questions.

Can you DIY garage renovations?

In short, it depends. Some states require certified professionals to handle certain tasks such as significant structural changes, electrical wiring, and plumbing. Presenting your plans when you apply for a work permit should clarify when and how to tackle each part of the transformation.

If you are not making major structural changes to your garage—only sprucing up the look of the space—major permits and certified pros may not be necessary, but it's always important to double-check.

Does adding a garage apartment add value to your home?

When creating an apartment out of an existing garage, you can expect about an 80% ROI, depending on the project. Don’t forget to account for rental income if you plan to rent the space out to new tenants. Depending on rental prices in your area and the size of the project, you could cover renovation costs in less than a year.

Can you add an apartment above a car garage?

Adding a living space above an area with packed cars is possible, but you'll need to go through the proper channels. Most building codes require you to meet strict safety standards to ensure adequate insulation, ventilation, and egress exits to place a livable space above a functional garage.

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