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What to Do Before Building a Laneway House or Garden Suite

Laneway Home Exterior Shot
Ron Adriano/Lanescape

Owning a home can be pricey, especially in urban cities. So, it makes sense that more property owners are getting creative in terms of monetizing their space. Enter laneway homes and garden suites, a growing trend among Canadians who are looking to create more housing space for their families or generate a rental income.


Thinking of creating or living in a laneway house or garden suite? Read on to learn all you need to know about these creative living solutions.

What are Laneway Houses and Garden Suites?

In certain Canadian cities, zoning by-laws now allow homeowners to build a second, detached home on their properties. If that secondary dwelling exists close to a public alley, it’s known as a laneway house. If it exists on the property and it isn’t close to a lane, it’s referred to as a garden suite or a coach house.

In both cases, all of the utilities and services (think water, gas and electricity) are shared with the main house. These additions tend to be smaller in size and meant for one or two people, although depending on where you live they can be larger with additional storeys or a basement.

Related: This Toronto Laneway House is Small Space Living at Its Finest

Modern interior of laneway house in Toronto
Ron Adriano/Lanescape

Things to Consider Before Building a Laneway House or Garden Suite

While it may seem appealing to create an extra living space for grandparents, grown children, or renters, your legal ability to do so varies depending on where you live. Vancouver is one of the main Canadian cities where laneway houses and garden suites are popping up, and the city has an online tool to see if you qualify.

Toronto is also on board with the laneway housing trend and has its own requirements for who may qualify. It’s also worth noting the city has a special deferral program under which qualifying residents can defer payments within 20 years of the permit being issued.

Edmonton, Burnaby, Calgary, Hamilton, Ottawa and Halifax are other Canadian cities that have adopted the laneway housing trend.


Related: The Most Affordable Cities in Canada for Solo Homebuyers: Report

How Much Do Laneway Houses and Garden Suites Cost?

If you’re wondering what an average investment is for a laneway house or garden suite, a good rule of thumb is to estimate between $350 to $500 per square foot. However, how much you’ll realistically spend depends on various factors, and like other home renovations, costs can quickly escalate.

Depending on where you live, there are several programs homeowners can take advantage of to lower or defer the costs of building a laneway house or garden suite. But once you receive that permit, there are hidden costs to consider: from landscaping and a property survey (essential to ensure you’re building on your property and not your neighbour’s) to engineering, architectural and development fees.

Related: These Big Renovations Will Beef Up Your ROI

Modern black laneway house with neon door in Toronto
Ron Adriano/Lanescape

How to Get the Biggest ROI From a Laneway House or Garden Suite

If you’re building on your property to increase its value or to generate rental income, it’s always a good idea to speak with a realtor and do your research in terms of what is most desirable in your area.

In general, you’ll want to build a structure that has at least two bedrooms. Creating a single-storey home also maximizes space by eliminating the need for stairs, all while making it more friendly for seniors. Window placement, high-efficiency options and an on-demand hot water system are also elements to consider if you want to maximize return on investment.

Related: Buying an Investment Property With Friends? Ask These Questions First

Modern white interior of laneway/garden suite in Toronto
Dave Rempel/Lanescape

Things to Consider Before Moving into a Laneway House or Garden Suite

Moving into a laneway house or garden suite is a good way to reduce your environmental footprint and potentially lower your cost of living. But before you sign on the dotted line, remember to ensure that everything is up-to-snuff from a legal standpoint and that zoning and other bylaw requirements have been met.


You may also want to scope out how private the structure is if it’s close to a laneway and whether it’s fully accessible if you drive or bike. It’s also a good idea to have a frank conversation with the owner ahead of time about maintenance responsibilities and how reliable the utilities and services are, including services like garbage pickup and internet.

Check out local rental regulations and how laneway housing and garden suites factor in when it comes to tenant rights. If all seems above the line and manageable, you may have just landed a creative new housing solution!

All images courtesy of Lanescape, a Toronto-based design and construction firm dedicated to laneway and garden suites. 

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