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Nothing wrong with the existing joists, just that they will not be strong enough to support the floor in a regularly used room. OK for light storage. As for T & G, that's just chipboard with a neater finish. Materials will cost nowhere near what you've described, however I notice you live...

Hi. Upon moving into our new house, and with the impending arrival of our new baby, I put chipboard onto the existing joists merely to provide storage space. However, we are now running out of space fast and frankly I need to maximise the house space by using the loft for a 'proper' room...