Yes, you can extend in most of Watlington, though the historic centre will make you ask first. The town has nearly a hundred listed buildings. One conservation area covers its oldest streets. Hundreds of planning applications go in every couple of years. The newer estates allow plenty, and the old core allows a lot less.
Historic England's list counts 92 listed buildings in and around Watlington. None is Grade I, three are Grade II* and the other 89 are Grade II. Listing covers the whole building, inside as well as out, so changes that affect its character need listed building consent from the council on top of any planning permission, and work done without it is a criminal offence, not just a planning dispute. Not one building in the town is grand enough for Grade I, so the restrictions come from 89 ordinary cottages and shops rather than from one great house.
There is one conservation area, Watlington's own, covering the historic centre. Inside it the council looks harder at anything visible from the street, including demolition, extensions, roof changes and work to trees, and some of the smaller jobs that need no permission elsewhere need it here. The boundary decides a great deal. A house just outside it and a house just inside it can be dealt with under quite different rules. Look up whether the house is listed and whether it falls within the conservation area boundary while you are still deciding on it, not after you own it. Both are public records, and both decide what you can do with the house afterwards.
People in the town do alter their homes, and often. South Oxfordshire's planning records show 436 applications for the area between April 2024 and June 2026, with 187 of them in the most recent twelve months. That is a lot of conservatories, loft conversions and rear extensions being argued over in a town this size. The old station's corrugated-iron carriage shed has outlasted the railway it was built for. Corrugated iron on a listed cottage in the town centre would not be allowed to stand for long.
In practice there are two separate rule books. On the late-twentieth-century streets, a modest rear extension or loft conversion may fall within permitted development and need no application, subject to the usual size limits and to confirmation from the council. In the conservation area, and on any listed building wherever it stands, assume consent will be needed and that the council will care about materials, windows and how the change looks from the street. A sympathetic design and a pre-application conversation with South Oxfordshire's planners will save more time than any number of revised drawings.
The freedom to extend here is middling. Most of the town has the usual room to build, and the listed old centre is where plans meet real resistance.