Secondary suites. Two words: Fix this
Secondary suites. Two words that have made people cry. Two words that have frustrated city councillors for years.
Two words that have infuriated neighbours.
Two words that lead to wasting hours in council chambers for applications to be presented and, hopefully, approved.
The City of Calgary has the most archaic approvals system in Canada and yet, people show up with their fees paid and applications in hand to plead their cases to city council.
Many times, those pleading their cases have to open up their private lives.
I recall, last September, a widow, with no pension and living below the poverty line, made her application.
She had lived in her home for four decades, but on a limited income, couldn’t afford to stay in her home, even though it was paid off years ago. She said she couldn’t afford the high taxes.
A secondary suite would provide enough revenue for her to stay in her home, she said, while fighting a losing battle to hold back her tears.
There were people in chambers who wept with and for her.
“This is embarrassing. We should not have to have citizens come up and cry about the loss of their spouse and their lack of income or about losing their job or about a brain injury that put them on disability,” said Mayor Naheed Nenshi at the time. “Why are we doing this to ourselves? No other city in Canada does this and citizens have a right to be upset about it.”
Given that pulling your own teeth is less painful, why would anyone go through the application process?
A survey conducted by Square One Insurance Services of 5,500 homeowners in B.C., Alberta and Ontario sought and found an answer to the question.
“We wanted to conduct this survey for two reasons,” says Daniel Mirkovic, Square One’s president. “We’re noticing an increase in inquiries by house owners that are renting a portion of their home to nonfamily members. We wanted to understand what was driving this increase. We also wanted to understand how house owners are coping with municipal laws relating to rental suites in single-family homes.”
The survey found Alberta has the highest percentage of homeowners who rent out a portion of their homes to non-family members at 14 per cent, followed by B.C. at 13 per cent and Ontario at nine per cent.
The top three reasons to have rental suites are: Extra income (40%); help with mortgage payments (34%), and; companionship (14%).
Of special note, the survey found many secondary suites in single-family homes are illegal, led by Ontario at 21 per cent, B.C. at 15 percent and Alberta at 14 per cent.
(Mirkovic adds the actual percentage is likely to be considerably higher as residents may be reluctant to disclose illegal rental suites).
Ontario has the highest number of secondary suites at 233,000, according to the Canadian Mortgage and Housing Corporation (CMHC). There are 155,000 in B.C. and more than 125,000 in Alberta.
CMHC also reports secondary suites are usually less expensive to rent than apartments. For example, the average cost in Metro Vancouver of a two-bedroom secondary suite is $1,390 per month, while a two-bedroom apartment suite is $1,450 per month.
“While mortgage-helpers are well, helpful, there are many municipal regulations that house owners need to be aware of. For example, Vancouver and Toronto have capped the number of rental suites allowed per single-family house to just one,” says Mirkovic. “Other regulations, which vary by municipality, usually include zoning restrictions, building code compliance, unit size restrictions, minimum parking requirements and inspection and licensing compliance.
“Most municipal regulations for secondary suites ensure residents have adequate and safe housing options. But some, like the one rental suite per single-family house, are just outdated. It’s hard to understand why cities advocating for more affordable housing options would continue to enforce this outdated regulation.”
I’m not sure that last idea is going to fly, at least not in Calgary.
If you’ve ever watched a secondary suite application presented in council chambers, you’ve seen neighbours up in arms about just one suite in the home.
It costs, on average, about $25,000 to build a new secondary suite in Calgary. (To the end of July 2017, the city’s building permit application statement shows 49 secondary suite applications with a total value of $1,256,204 have been approved this year).
Mirkovic reminds those with secondary suites that they change how your insurance company looks at your file.
“If you’ve added a rental suite in your home, then you’ve likely increased the property value. Most policies require that you advise your provider of any improvements over a certain amount. If you fail to do this, then you may be underinsured in the event of a loss,” he says. “Most policies also require that you advise of any changes in how your home is used. Failing to disclose rental suites could render your home insurance void.”
So there’s an added cost, but the cost of time spent navigating the bureaucratic maze — from filing the application, appearing before the Calgary Planning Commission, then arriving at council chambers an emotional wreck — is much too high. We get a new council in October. Secondary suites. Two words: Fix this.
“This is embarrassing. We should not have to have citizens come up and cry about the loss of their spouse and their lack of income or about losing their job or about a brain injury that put them on disability.” Calgary Mayor Naheed Nenshi, quoted in September 2016 about secondary suite applications