A plunge pool gives you the best of both and allows you to maximise the space and your budget. Adding gas heating and spa jets and even a swim spa jet to a plunge pool would really complete this goal.

Thanks everyone for your further comments. No problem about it being an old post, always nice to communicate with people about design solutions/problems. Jilly, I posted some photos on 1st January 2016, they appear further up in the post. Garden Beet Pty Ltd, and Morel Construction Ltd, both of your solutions look great, but our problem still remains the western Queensland sun which is pretty vicious on anything that will either wilt, fade or break down. It was quite a difficult challenge to come up with something that was affordable, workable and durable. I would love to have had plants because I believe they soften large "hard" exterior areas, but we have decided that we will do that with pots around the pool area. Still have that to do, even after all this time. :) Thanks everyone for re-igniting this chat. Jilly, hope you find something that works for you.

I wonder if you should look into this a lot further. I find it hard to believe that you can't sell a house in the kind of location you describe, walk away, and find a nice place maybe in one of the more peripheral areas, that will meet your requirements, give you cash in hand, and not touch your $100,000 nest egg. No, you certainly wouldn't end up in the inner city but you could end up in a situation that provides the facilities you need and gives you a financial cushion. That said, my real concern would be how to make this house workable for boarders while preserving your privacy. I think you need to provide a floor plan of what you have for anyone to make anything approaching informed advice.

@Emma I, What you're suggesting is a pretty bold move and irrespective of whether you are permitted to do it in the end by your respective shire and other authorities, I can't stree enough that for all the money you are thinking of spending on this project and the lengths to which you are intending to go with removing windows, dig a huge hole for the pool etc... that you use some of your finances to employ an architect as suggested by EmileECLC to make sure that this massive transformation becomes everything you dream it will be!! You must be absolutely sure of regulations surrounding pools like mentioned by mazgardiner about not being able to directly enter a pool from the house for example. Hubby and I are building our own home and we decided to have an indoor pool. We were originally having a sliding door leading outside of the pool, only to find that we were not permitted to have this access from the pool outside and I expect it was the sliding door, as with mazgardiner that was the issue, as it would be far more difficult to make it a self closing and lockable door. Fortunately we had already decided to change the slider to an awning window instead and just as well. The access into the pool from inside the home is a hinged door with a self closing mechanism and has the handle positioned at 1.5m from the floor. Furthermore, we were told by the window manufacturers, that any glass near a pool area had to be safety glass by law, so your stacker doors or any other windows that form part of the new pool area, will need to be upgraded and be much more expensive just so you know, about double the cost of a standard window. Another safety feature with our awning windows was that the wind out chain could only open to a maximum of 100mm, again law, just like the bars in a safety fence. Our building inspector tried to tell us they would not be allowed and that we would have to have external bars fitted and have the windows permanently screwed shut but further contact with our state building commission deemed the 100mm gap to be safe and adequate. Don't just accept something that seems wrong, if need be, take it higher as we did and succeeded, so again another reason to have a professional helping you through the maze of regulations.