Secondary dwellings

You’ve been renting for a while and you’ve finally decided that home ownership is for you.  Interest rates are good, it’s a “buyers market” …… everything is in your favor.  Except you’ve met with the bank and what you want, in the neighborhood you want simply won’t work.

Sometimes an investment in the right home that will already have, or will allow for a secondary dwelling is the way to go.

Traditionally known as an in-law suite, or Nanny suite, adding a single, self-contained rental apartment to your home provides additional income to assist you in your monthly payment. The suites have there own bathroom, kitchen, living area, and sleeping areas but are able to share other features in the home such as the backyard, parking area, laundry, and storage space.

There are, mind you, numerous things to consider before adding a unit to your home;

  • You need a building permit before proceeding.   The “Change of Use” must be reviewed to ensure compliance with the Ontario Building Code.
  • No more than an amount equal to 40% of the gross floor area of the principal dwelling may be developed for the secondary unit….this doesn’t apply to the creation of a basement unit though. There is not maximum size.
  • The new unit must have a separate entrance on the ground floor of the principal dwelling unless building or fire codes allow.   Front door restrictions include facing the front yard.
  • No additional parking is required although where one is provided, it cannot be located in the front yard.  Tandem parking in the existing driveway is permitted.


These are just a handful of some of the requirements for secondary dwellings.

And although the dollars generated from an income generating property sure do help, keep in mind that your property taxes may change. Rent counts as additional income so your personal income taxes will be affected. And your insurance company will need to be notified and may be adjusted to reflect the changes in liability.


BUT, after all is said and done, CMHC still contends that secondary dwellings can make financial sense if done properly.