Luxury extension can perhaps ruin housing (12)
I believe the answer is:
extravagance
'luxury' is the definition.
(synonyms)
'extension can perhaps ruin housing' is the wordplay.
'extension' becomes 'ext' (abbreviation, as in a telephone extension).
'perhaps' is an anagram indicator.
'ruin' becomes 'ravage' (ravaging is a kind of ruining).
'housing' is an insertion indicator.
'can' with letters rearranged gives 'anc'.
'anc' inserted into 'ravage' is 'ravagance'.
'ext'+'ravagance'='EXTRAVAGANCE'
(Other definitions for extravagance that I've seen before include "Profligacy" , "Lavish expenditure (E, not Y)" , "Overspending" , "Excessive spending" , "lavish generosity" .)