This blog is reprinted with permission from Hayes Homes (www.hayeshomes.ca).
On July 22, 2015 after days of arguing over the Paskapoo Slopes, Calgary City Council quietly passed a bylaw that will be a game changer for secondary suites. This bylaw was the first common sense statute to come out on secondary suites since the debate started many years ago. This regulation serves two main purposes: it cuts down on the time and red tape to construct new legal basement suites and makes it easier and cheaper to legalize existing suites that have been in place prior to 2007.
The old process of legalizing a secondary suite involved two stages: adevelopment permit and building permit. A development permit is used to check if a property or development meets bylaw requirements. This will include things like zoning, the permitted or discretionary uses, and if the parcel meets requirements for dimension, area etc. The building permit phase makes sure that the construction of the project meets the code requirements in the Alberta Building Code. The same process used for a basement suite was also used for a downtown high rise tower. I always thought the development permit for a basement suite was overkill and finally the city has proposed to eliminate it, with some conditions.The DP (Development Permit) Exemption Program
The DP Exemption Program takes a 8 to 16 week process down to 1 or 2 days. For the next 18 months, the city is trialing a program that will eliminate a DP for properties that have permitted use for a secondary suite and do not require relaxations for variances. For those that don’t speak city planner – If your property has a zoning that allows for a secondary suite and it meets the bylaw requirements, then you can skip to a building permit.
All zoning has permitted uses and discretionary uses. In a nutshell, a permitted use means it is allowed and a discretionary use means it may be allowed depending on factors that the city examines including neighbour and community input. I will give an example using a common property in Calgary. The zoning for this property is R-C2 whereby a secondary suite is a permitted use.
1234 199th Street – Zoning is R-C2. Lot size is 15.24m x 38m.
Major Bylaw Requirements for a Basement Secondary Suite in a RC-2 Zoned Property:
- Parcel width must be >9m (this is not the frontage, its measured from the centre of the lot)
- If parcel width is between 9m-13m, suite size has to be <70m2
- 2 Onsite parking stalls (one for each unit)
- Amenity space of 7.5m2 with no dimensions less than 1.5m2
- One side setback free from obstructions
So in this example, the above property meets the requirements and you can build a secondary suite that does not have a square footage limit. Under the new program, the permit would take 1 or 2 days. If any of these five major bylaws are not met, then you would have to apply for a Development Permit and ask for a relaxation or variance to the rules. Generally, the development permit authority can authorize a 10% variance. Variances will be advertised to the neighbourhood and community association who has the right to appeal. Appeals are heard at the Subdivision and Development Appeal Board (SDAB) and a decision is made by a panel of citizens and some city councillors.What About Existing Suites Prior to 2007?
This is where the magic happens. If you have an existing suite prior to 2007, then you are going to save a lot of money with this new program. Existing suites prior to 2007 are only required to meet the Alberta Fire Code. The Alberta Fire Code is part of the Alberta Building Code but is not as strict as the ABC. The fire code focuses on three key lifesaving items: early warning, safe exit and smoke seal. The early warning involves smoke detectors within 5 metres of the upstairs and downstairs bedrooms and one in the mechanical room. These smoke detectors have to be able to talk to each other, in the fire code this can be done wirelessly.
Safe exit involves egress windows in the bedrooms that are big enough to escape out of and a clear exit path to a door outside that has head clearance of 1.95 metres. Last but not least, a smoke seal involves having ½” drywall sealed with mud and tape between each unit and on each side of the mechanical room walls. These are all critical safety items that must be met; but it is a lot less expensive than meeting building code requirements.New Alberta Building Code
If you are constructing a new secondary suite or legalizing a suite that has been in place after January 1, 2007, then your suite must comply with the Alberta Building Code. The 2014 ABC has changed from the 2010 code and is more strict for secondary suites. The changes will be official on the 1st of November, 2015.
If you get a building permit prior to that date, then you just have to meet the 2010 code. Although there was a lot of doom and gloom from the city on these changes, they are not all that bad. There will be additional costs for smoke alarms and doors, but I have not noted anything that is of a substantial cost. I will post an update when I am able to interview city building code experts.The Safe Suite Registry/Sticker Program
This fall, the city will be launching a safe suite registry. This free registry will be online and automatic to those that have a legal suite. The idea behind the registry is to be able to look up all legal suites in the city. It is in conjunction with a sticker program. Legal suites will have a sticker in a visible window or door with a number that corresponds to the unit in the registry.How a Sophisticated Investor can Take Advantage of This?
If you own a secondary suite that is illegal, now is the time to legalize it especially if it has existed prior to 2007. The process to legalize a secondary suite has never been this easy. The city only has this program slotted for 18 months. We do not know if they will keep it around after that.
If you are looking at purchasing a property and installing a secondary suite, the permit process has never been this fast. This means you can start renovating immediately and cut down on vacancy costs. Tenants will be looking for safe suites and potentially reporting suites that are not legal. It will now be very easy to tell if a suite is legal or not.
Having a safe and/or legal suite will reduce your exposure to liability and potential fines. If your suite does not meet zoning requirements, you can still make sure your suite meets the fire code. You also have the opportunity to rezone the property to a permitted use for a secondary suite. Rezoning applications are now free and 87% of the requests are successful.
As always, feel free to contact me if you have any questions or need directions on the legalization process. You can reach me via email – firstname.lastname@example.org
Sean Hayes is a passionate real estate investor who got started investing in 2010 after realizing a high income does not equal a high net worth. Sean is a REIA and he specializes in managing large renovation projects, particularly developing and legalizing secondary suites in Calgary Alberta. Sean has recently obtained his real estate license and joined forces with Steve Throndson from RE/MAX. In his new role, Sean will bring his experience and talent to the table to help fellow REIN members to find, purchase, and develop, exceptional cash flow properties.