Should you extend out or add a second storey in Melbourne?

By Barbara Yerondais
Sep 22, 2026

Answering: Ground-floor extension or second storey: how do you decide which way to grow a Melbourne house that is not under a heritage overlay?

Estimated reading time: 12 min read

It is 7am, and the school bags already own the only clear patch of kitchen floor. Through the glass is the backyard you love; above, a roof you have never really considered. One more bedroom would change the week. The live question is where it belongs: on the ground, spending garden, light and setbacks, or upstairs, asking the footings, the stair and the neighbours to carry a different kind of weight.

The short answer: extend out when the block has depth, the sun arrives from the right side and the garden can spare the room; build up when land is tight, the outlook argues for height and a structural engineer confirms the house can carry another floor. Then check the lot size, which in Victoria picks the rulebook: under 300 square metres in most residential zones, an extension needs a planning permit assessed against Clause 54; on larger lots with no other trigger, siting is assessed through the building permit.

BY Projects Architecture, with 400-plus projects across Victoria behind it, works the choice in order: site, structure, household, permit path, budget. Each direction spends something different; the right one spends what your house can best afford to lose. Our extension practice maps the four ways a Melbourne home can grow; here are the two most common, head to head.

Key Insights

  • Lot size picks the rulebook: Clause 54 and a planning permit under 300 square metres in most residential zones, Part 5 of the Building Regulations 2018 on larger lots with no other trigger.
  • A house without a heritage overlay can still carry a neighbourhood character or flood overlay that brings a planning permit with it.
  • Every extension needs a building permit unless exempt, and any planning permit comes first.
Weighing Points to extending out Points to building up
The block Depth behind the house; a garden that can give up area A shallow or tight lot with little yard to spare
Light and outlook North light already reaches the back The light or the view sits above the fence line
Structure New footings beside the old house Existing footings, walls and roof checked for the new load
Neighbours A boundary fence can screen a ground-floor room Overlooking, shadow and setback tests tighten with height
Daily life and the build Living and garden on one level; work stays at the back A quiet bedroom floor; part of the roof opened during the build
What it spends Garden, open ground and any rear easement Stair space on both levels, plus structure and roof work

Table of contents

The block decides first: depth, sun and what the garden can spare

Walk the block before you picture a room. A rear extension needs depth and a garden that can give up floor area without losing its purpose; on a narrow inner-Melbourne lot, every square metre of extension comes straight out of the family’s only outdoor room.

Orientation matters as much as area. A north-facing back lets a ground-floor addition sit in sun you already enjoy; a south-facing one can leave new rooms in their own shadow unless light comes from above, while a second storey often reaches light a single-storey addition never sees.

Then look underground. Registered easements for drainage and sewerage are listed on your title and often sit on a boundary, exactly where a rear extension wants to go. The City of Boroondara also treats the ground above an underground pipe or access pit, plus a metre either side, as an implied easement you cannot build over without an approved request. A second storey mostly stays inside the existing footprint.

On a falling site, a ground-floor extension can become a retaining and drainage project, which is why height sometimes wins; our guide to building on sloping or difficult Melbourne sites works through that stack.

Before you choose a direction, check these three things:

  • the depth from the back wall to the rear boundary
  • which way the back of the house faces
  • your title and property plan for easements, pipes and access pits

Going up asks the house a structural question first

A second storey adds weight to a house that was never designed to carry it. The footings, walls and roof framing have to be assessed for the new load, and that is a structural engineer’s call, not a hopeful sketch. Some houses take a second floor with modest strengthening; others need new footings or a steel frame threaded through the ground floor, which changes the budget and the disruption.

The stair is the quiet cost: it takes floor area on both levels and has to land downstairs without cutting the living area in half. On a compact plan, that one decision can make or break the idea.

Then there is living through it. A ground-floor extension can often be built while the family stays in the front rooms. Going up usually means opening part of the roof, so weatherproofing, noise and access belong in the brief from the first sketch. If the engineering answer comes back heavy, a partial upper level over the strongest part of the house can deliver the bedrooms without asking every wall to change.

How your household moves through a day

Floor area is the easy part of the brief. Kitchens, living rooms and anything that opens to the garden want the ground; bedrooms, a study or a parents’ retreat can climb a stair without anyone missing them by day.

So trace an ordinary Tuesday: who is up first, where the bags land, where homework happens, who needs quiet at 9pm. If the pinch point is the kitchen and living zone, extending out usually solves the right problem. If it is bedrooms and privacy, building up gives the household a quiet floor and leaves the garden alone. If anyone expects to age in the house, keep a bedroom and bathroom on the ground floor either way.

Sometimes the best answer uses space the house already has. In Altona, we turned a 1960s triple-fronted brick veneer from three bedrooms into four by enclosing an underused rear patio as the new living and dining room, with clerestory windows drawing in northern light. The old living room became a fourth bedroom with its own ensuite: a modest extension, with most of the gain coming from replanning rooms the house already had.

Your permit path: lot size and overlays pick the rulebook

“No heritage overlay” narrows the question without settling it. The Planning Property Report for your address maps the zone and every overlay, and a neighbourhood character or flood overlay can still require a planning permit. If it shows a Heritage Overlay, read our guide to who can extend a heritage or character home in Melbourne instead.

Clause 54, the part of every Victorian planning scheme that governs one dwelling on a lot, applies under 300 square metres in most residential zones, where an extension needs a planning permit. Since 8 September 2025 it has been deemed-to-comply: meet a standard and its objective is taken as met. Meet the VicSmart eligibility standards and the application can go through VicSmart, a fast-track process with no advertising or third-party appeal, where council has 10 business days to decide once every required document is lodged. Amendment VC315 refined the standards again in September 2026, so check the version in force.

On lots over 300 square metres with no planning trigger, the siting rules in Part 5 of the Building Regulations 2018 apply instead, assessed by your building surveyor. Report and consent is the council process for a design that does not meet one of those rules: council reports on the variation and decides whether to consent.

Height brings extra tests. Clause 54’s overlooking standard expects a living-space window, balcony or deck within nine metres of a neighbour’s secluded open space to avoid direct views into it, unless its floor sits less than 0.8 metres above ground behind a boundary barrier at least 1.8 metres high, which only a ground-floor room can manage. It also tests a neighbour’s secluded open space for sunlight from 9am to 3pm on 22 September, and a second floor casts a longer shadow.

The practice’s 200-plus permit applications are a record, never a promise about yours; for how long each path takes, see our guide to planning approval timelines in Melbourne.

Budget last: price both directions before you choose

Is it cheaper to extend out or build up? There is no honest Melbourne-wide answer, and a figure quoted before anyone has seen your house is a guess. Going up adds items a ground-floor extension avoids: the stair, structure tied into the existing house, roof alterations, scaffolding and temporary weatherproofing. Going out brings footings, a slab, drainage and whatever the back of the lot hides. Our guide to what a home extension costs to build in Melbourne in 2026 sets out the published bands.

So we price the decision instead of guessing it. Our fees are fixed and staged, and once the staged design begins, Barbara’s approach is to draw two versions side by side, what the budget buys and what the full wish list would cost, with a list of items you can trade between them. Fixed-fee certainty, so you don’t dread the next invoice.

It starts with the one-hour Feasibility Session. In one hour with Barbara Yerondais, FRAIA, in person or on Zoom, you’ll talk through your site, budget and planning timelines, and leave knowing what’s realistic and what your next step is. There’s no obligation to go further.

Closing

Extend out when the block, the sun and the garden can give; build up when land is short and the house can carry the load. Let lot size and overlays tell you which rulebook applies. In order:

  1. Walk the block: depth, orientation, easements, slope.
  2. Ask a structural engineer what the house can carry.
  3. Trace an ordinary day and decide which rooms go upstairs.
  4. Pull the Planning Property Report and confirm the permit path.
  5. Price both directions on your own lot, against one brief.

Frequently asked questions about extending out or up

Q: Is it cheaper to extend out or build up in Melbourne?

A: There is no reliable Melbourne-wide rule. A second storey adds a stair, structural work back into the existing house and roof alterations; a ground-floor extension adds footings, a slab, drainage and anything buried at the back of the lot. Price both directions on your own block, against the same brief.

Q: Do I need a planning permit for a second storey if there is no heritage overlay?

A: It depends on the lot and any other overlay. Under 300 square metres in most residential zones, you need a planning permit assessed against Clause 54; if the design meets the VicSmart eligibility standards, council has 10 business days to decide a complete application. On larger lots with no other trigger, Part 5 of the Building Regulations 2018 applies through the building permit.

Q: Can we keep living in the house while it is extended?

A: Often, with a ground-floor extension, because the work can be closed off at the back while the front rooms carry on. A second storey is harder to live under: part of the roof is opened and the stair breaks through into the rooms below. Settle living arrangements at feasibility, before the design is fixed.

Q: What does a one-hour Feasibility Session give us?

A: In one hour with Barbara Yerondais, FRAIA, in person or on Zoom, you’ll talk through your site, budget and planning timelines, and leave knowing what’s realistic and what your next step is. There’s no obligation to go further.

Want to talk it through?

BY Projects Architecture brings 35-plus years in practice and 400-plus Victorian projects to extensions, new homes and difficult sites, on fixed fees.

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About the Author

Barbara Yerondais, FRAIA, is the founder of BY Projects Architecture. With 35+ years of experience, she specializes in sustainable, community-focused design and heritage restoration. A dedicated mentor and rower, Barbara balances her high-impact Melbourne practice with a passion for social inclusion and passive, energy-saving design.

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