Not sure where you are located but in my area garages and small, like 100 sq ft, additions both cost well over 50k. Does your neighborhood and bank account support expensive upgrades? It is often less money to move to a house that already meets your needs than to add onto existing properties. I am not against additions and I have made emotional decisions on my own property but I know I will not recoup those costs. It was money spent not invested but we could afford to make changes because we waited until we were mortgage free.

As to your question I prefer young kids on the same floor as me and I think sharing a room is a great life experience for siblings while they are young. I also know planning for more kids does not always mean having more, so I would not spend 100k on a possibility. I would wait until after I knew for sure that I needed more room and a toddler and infant can bunk together while deciding what works in reality for the actual family you have.

That isn’t going to work for an addition. The shed roof won’t have enough height by the time it extends out far enough. The only easy way to extend rearward would be to extend the 2 story gable out. That doesn’t equate to cheap though. The gable extended would bisect the windows on the lower level as well, necessitating an expensive modification to that. Just a regular master suite addition with bath runs $130K plus. This would be more. The garage starts to sound cheaper until you realize you have to resort everything to make that work as well. Take the $200K that you’re tsljunhbabout putting into this house and go shopping.

Time for the “move up” house.