Definantely keep the old garage, it's been there much too long to be considered illegal, your neighbour would also love the privacy it provides to both of you, we have a similar one next to our pool, we love it. Agree some gardening and clearing away some old bits and pieces. Just attaching a couple more photos, don't throw the plants away just repurpose them. the first photo is of a builders house, he used the existing garage as a games room with added pergola over original driveway, a second carport is off to the left looks brilliant (they get quite a lot of sun on this side). The next two are before and after shots of a mid centuary house similar to your's, the last photo is of our current house, flat roof garage is hiding solar panels, we have changed the colour pink to a more original one, grey green.

Hi dreamer, thanks for the suggestion. Im wondering though, how do I treat the junction between the vanity and the fixed panel of the shower screen? The diagram I uploaded above leaves out the shower head, so there will in fact be a shower-over-bath in the above scenario, with a fixed panel adjacent the bath. If I have the vanity hard up against the bath, I'll need to tile the side of the vanity, no?

A photo would help. Usually I-beams are steel, but I havn't seen them paired with straw ceiling panels before. If discolouration is coming through the paint I would research that you are using the right sort of paint. If they were previously painted then they are probably an oil based enamel paint which can have problems if the new paint is acrylic. Getting the paint problem properly resolved will be cheaper than boxing in the beams with a new material. Best of luck, Dr Retro Dr Retro House Calls

@Dee painted fly screen door up now. Still haven't painted concrete stairs and verandah.