A laneway home, also known as a garden suite, accessory dwelling unit (ADU) or coach house, is a small, self-contained living unit built on an existing home’s property. These units can be used for a variety of purposes, including generating extra income and expanding your useable living space.

If you’re considering building a laneway apartment, this article is for you. We will summarize the key advantages of these dwellings and highlight the main things you need to know before you proceed.

The Advantages of Laneway Suites

Adding a laneway home to your property has several benefits, including:

  • Earning additional income:

Renting out your laneway home is a great way to bring in extra money. In cities with housing shortages, laneway homes are in high demand, making them a potentially lucrative investment. The extra income might allow you to pay off your mortgage, travel more, or retire earlier.

  • Increasing your property value:

Even if you don’t intend to rent it out, a garden suite will make your property more desirable to potential buyers because it will offer them more options for using their home. For example, if a buyer needs a separate office or an independent space for teen children, a property with an extra, self-contained unit will be attractive to them.

  • Expanding housing options in your community:

Many of our urban areas are experiencing housing crises. Adding a secondary dwelling on your property can help to alleviate this problem, especially if the rent is affordable.

  • Creating a flexible-use space:

If it’s not rented out, a laneway home can meet a variety of needs. It can be a guesthouse, a studio, a home office, a teen hangout, a workshop, or a gym. This flexibility can be especially useful for homeowners who work from home, have a growing family, or plan to age in place.

  • Improving sustainability:

Laneway homes are typically smaller in size and require fewer resources to build and maintain than larger homes. This can make them a more sustainable housing option, especially if built with energy-efficient features and materials.

  • Facilitating multigenerational living:

Secondary units allow extended families to live together while maintaining privacy and independence. If you have aging parents who need support or adult children who are moving back in with you, you can give them their own space while staying nearby for when they need you.

  • Supporting family members with disabilities:

A laneway suite could be the perfect option if you have a family member who can live independently with some support. They would have everything they need to manage on their own, but you’re not far away to check in on them if necessary.

What You Need to Know Before Building a Laneway Suite

Before you break ground on your secondary dwelling, you will need to do some research:

  • Zoning and other regulations:

Check with your municipality to ensure this type of structure is allowed on your property. You will need to pay attention to zoning regulations, the number of independent dwellings permitted on your property, regulations around landlord-tenant rights, requirements for the size and height of the laneway suite, the setback requirements, and parking availability.

  • Building permits:

Obtaining building permits involves submitting detailed plans and drawings and waiting for your plans to be reviewed and approved by the local building department. If you are working with a contractor, engineer, or architect, they may offer to get the building permits for you for a fee.

  • Design:

When designing your laneway suite, consider the size and layout that will best suit your needs. If you plan to rent it out, the unit should be functional and comfortable, with plenty of natural light, storage space, and privacy. Making the space as flexible as possible will help if you intend to use it for other purposes.

  • Consult with your neighbours:

The process of building and managing a laneway suite will be much smoother if you tell your neighbours what you are planning and invite their feedback. Failing to do so may result in problems down the road, especially if your proposed build will require a public hearing.

  • Look for grants, rebates, and loan forgiveness programs:

Governments at all three levels in Canada often have incentives for homeowners to add secondary dwellings. For example, the City of Toronto has an Affordable Laneway Suites Program that allows up to $50,000 in forgivable loans1, and the Canada Mortgage and Housing Corporation offers $60,000 in forgivable loans to First Nations or First Nations members to build secondary or garden suites.2 Check with your area’s governments and housing authorities for the latest incentive programs.

Adding a Laneway Suite to Your Property

Adding a laneway suite to your property can be a great way to add value and versatility to your home. Whether you’re looking for a source of rental income or a space for a family member, a laneway suite can be a practical and functional addition to your property. Just make sure to do your research and planning before you start your build.

Looking for a property with an existing laneway suite? Searching for a property where you could add a secondary dwelling? Wondering how a laneway suite could increase your property value? Get in touch with me today; I can answer all your questions and help you take advantage of everything a laneway suite has to offer.