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Also have a look at the work Piers Taylor does with Invisible Studio. http://www.invisiblestudio.org/ He's one of the presenters on "The House that ?100K Built". https://au.tv.yahoo.com/plus7/the-house-that-100k-built/ He avoids wet trades in favour of cheap, dry materials. So using...

How about considering a different shape for the extension? A very radical approach was taken by Andrew Marynard with the tower house, which was a collection of smaller buildings. You might not have space in your garden for this...