Something for the weekend: 'We built our dream holiday cottage for less than £100,000'

A second home in the South-west doesn't have to mean a mansion in Sandbanks or a pied-à-terre in Padstow.

The proud burghers of Totnes like to claim the market town possesses more listed homes per head than any other place in the country. Among this architectural munificence a squat stone garage in a side street close to the walls of its Norman castle barely registered – until Lesley Holmes and Geoffrey Larder got their hands on it.

The couple decided that, despite having no experience of house design or building, they could transform the mean space into a small but perfectly formed contemporary holiday home.

The project was a giant risk. They bought the site without knowing whether they would be permitted to convert it – and even if they could, their budget was perilously tight.

They drew up the plans themselves and learnt every building trade from plumbing to electrics in an effort to keep costs down.

The project took an exhausting – and sometimes exhilarating – four years. But the result is a lesson in how to make the most of a tiny space.

And the couple are now in the happy position of owning a cut-price second home in sought-after Devon, which they plan to let to holiday makers until they retire and move in full time. And there is certainly a market.

According to estate agent Knight Frank demand for holiday lets in the South-west was up 70 per cent in the early months of 2011 compared with the same period last year. And despite the recession, second-home ownership in England was still at the second highest level on record in 2010.

"I think that you need a certain amount of naivety to embark on this sort of journey because if you really knew what you were taking on board you would have second thoughts," says Holmes.

"It took a lot of work on every level. It is a exciting thing to do and when it turns out well, it is thrilling. But the sheer responsibility is terrifying."

The couple had moved from the Home Counties to Cornwall in 1990 in search of a simpler way of life, trading in separate homes in Hertfordshire and Kent for a stone farmhouse deep in the Looe Valley in Cornwall. Holmes, 55, a freelance TV make-up artist, and Larder, 68, an actor whose CV includes stints on The Sweeney and a role in the movie Mona Lisa, had a vague ambition to build a modern property.

"We wanted to do something creative and we were doing a lot of research into low-energy houses, primarily for environmental reasons but also because we were foreseeing that energy bills were going to rise in the future – and this was 15 years ago," explains Holmes.

The couple regularly visited the Friday market in Totnes, 40 miles from their home, and it was on one of these trips that they saw a 'For Sale' board hanging over the garage. Their imaginations were instantly piqued.

The building had originally been a dwelling, later converted variously into stables, a bakery and a store room. It was being used simply as a parking space when they snapped it up in 2007, just as the property market had begun to stutter.

"It had no planning permission so it was a huge risk," says Holmes. "It was basically just three old stone walls, and one concrete wall, and a roof which had to come off."

Because the garage was in a conservation area, they decided not to demolish it but to work with what they had. They did not want to create a historical pastiche and proceeded to break the first law of self-building by not using an architect. Their only concession to professional qualifications was hiring a local design firm to transform their sketches into drawings that they could present to South Hams District Council.

Since the garage was just 30 square metres, maximising space was the key issue. Fortunately, the council was supportive of doubling their useable living space by adding an extra floor, plus a mezzanine level in the pitch of the roof. Almost the only thing planners did insist on was that a garage space was retained. Parking pressure in Totnes is so great that it wants all new housing to come with off-street parking.

The ground floor is therefore mews style, with a garage and a shower room. Stairs lead to the main open-plan living and kitchen area. A sleeping space in the gallery above is lit by a triangular-shaped window embedded into the rear gable wall.

The exterior is clad in hard-wearing, sustainable western red cedar, and the high-spec doors and windows are timber clad in aluminium.

Planning consent was granted in 2007 and work started the following year. The build cost a slender £95,000, partly because Holmes and Larder have done so much of the work themselves. "We project-managed it. I was the quantity surveyor; making all the decisions, such as how much liquid concrete we would need," says Holmes. "Making all the decisions was the hardest thing – I was there checking the height of the eaves or the levels of the floor, and we didn't have an architect at the end of the phone for support.

"We had to learn everything for ourselves. Every single trade, we either took part in or did ourselves. So we had to do it bit by bit and we did a lot of research, which is why it has taken us all this time really. It was a long hard slog."

Although the couple needed to keep costs under control, they were not, however, prepared to skimp on design quality or finish. "The thing I heard every single day from the builders was 'don't worry, you're never going to see it when it's done', but that was not the attitude we had," says Holmes. "We wanted it to be the best it could be."

This sentiment is perhaps most obvious in the bespoke birch-based plywood stairs. The couple wanted a "proper" staircase, feeling that space-saving spiral versions would feel "precarious".

They also desperately needed to maximise storage space and so they turned to the architect-turned-furniture maker Jonathan Wright (www.tandemstudio.co.uk). He suggested they make their two flights of stairs double use, with concealed storage within. "It is brilliant, really," says Holmes. "We have got cupboards and drawers, full height hanging space and, on the first floor, it doubles as kitchen units too."

Wright designed the stairs and had the individual pieces laser cut off-site. Then he acted as foreman while Holmes and Larder assembled them in situ, sanded each section, and applied a hard wax oil finish.

Another crucial decision was over the mezzanine floor. The couple decided against a traditional attic bedroom, which would have been larger, in favour of an open gallery which means that, while the bedroom is cosy, part of their main living space is double height.

"Having all that light and height in a small space is lovely and means it doesn't feel small at all," says Holmes.

Perhaps the only downside is the prospect of one day swapping their roomy four-bedroomed farmhouse for a one-bedroomed pied-à-terre, no matter how smartly designed.

"Our house isn't actually that big, and we have all the normal storage you'd need in Totnes," says Holmes. "The other thing is that it is almost impossible to be environmentally friendly in an old stone farmhouse and it is pretty chilly in winter. It will be brilliant to be in a low-energy light-filled space."

The Viewing Gallery is available for holiday lets, priced from £580 per week. For information call 01579 342139 or see www. theviewinggallery.co.uk

Holiday homes with style

Mill House, Stalham, Norfolk – from £1,600 per week

Set on the banks of the River Ant, Mill House couldn't sound more traditional: a former mill-keeper's cottage in the Norfolk Broads. That was until architects Acme got their hands on it, creating a dark wood-clad extension. Sleeps nine. www.themodernhouse.net

Pontfaen, Brecon, Wales – from £950 per week

Nicknamed the hovering house this showstopping five-bedroom property is in the heart of the Brecon Beacons. Designed by architects Featherstone Young, with distinct undertones of Frank Lloyd Wright's masterpiece Fallingwater. Sleeps eight.www.themodernhouse.net

The Beach Haus, Burton Bradstock, Dorset – from £1,680 per week

An environmentally friendly Huf Haus – an open-plan space with acres of huge windows – once featured on Grand Designs, with panoramic views of Chesil Beach and room for eight people. Should the weather not hold, there is also a cinema room and games room.www.uniquehomestays.com

Camel Quarry House, Padstow, Cornwall – from £3,000 per week

Modular house built of local stone and with a stunning roof terrace, plus living area with 360-degree views of the Camel Estuary. Little luxuries include a hot tub, barbecue area, private mooring for a boat and gardens designed by Chelsea Flower Show gold medallist Mary Reynolds. Sleeps 16. www.holidaylettings.co.uk