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What is a "granny flat"? ?

I always see it with apartment/housing rental listings. Is it like a back house? Like this one: http://sacramento.craigslist.org/apa/999924573.html

Public Comments

1. It may mean that it is a single-story dwelling. There are no stairs to climb upstairs nor downstairs to a basement. Elderly people, especially those with arthritis, don't like stair climbing.
2. The above answer is incorrect. A granny flat is another name for "mother in law" suite. It can be an add on to the house which has a separate entrance, its own kitchen, bath etc. Like a small efficiency apartment. It can be a small dwelling in the back of your house ( in the back yard) It can be a converted garage or basement with its own entrance. It has nothing to do with stairs.. LOL You had it right when you thought it was like a back house. Landlord usually lives in the main house, and rents out this smaller place to help defray costs.