The federal government is introducing new support programs for the building trades specifically to meet the needs of a housing shortage that has grown to such a dire level that the Prime Minister himself named it a “crisis.” Last year, the government oversaw the disbursement of 44 billion taxpayer dollars that, for the most part, flowed to an industry that was already working at capacity. Builders in many locales were turning away (often quite literally) would-be clients due to a prohibitive combination of interest rates, construction costs, and lead times. Despite the gloomy forecast, the government has promised that more homes built by more builders are on the way.
Why Now is the Right Time to Consider a Home Addition
In recent times, the government has made some changes that seem aimed at doing two things—cutting the red tape that often bogs down homeowners in bureaucratic processes when they want to make changes to their homes and offering new financial incentives that can help pay for those changes. The hope, certainly expressed in the most recent budget, is that these will together make it easier for homeowners to create new rental spaces in their homes. If those spaces can be rented out, they will help generate new income for the homeowner and provide valuable living accommodations to people in need. And even if the rent isn’t charged, the spaces will still help meet some of the important accessibility needs that many families have.
Key Benefits of the New Loan Program for Secondary Suites
- Access to Low-Interest Loans up to $40,000
Funds are available to help homeowners cover some of the costs of creating secondary suites. These have become essential as more people look to the rental market and as cities try to alleviate the housing crisis. Suites are being built everywhere—on the streets of the city, in the side yards of bungalows, on the back porches of townhouses, and in the hellish cul-de-sacs of gated communities. - Mortgage Insurance Changes
The federal government intends to revise its mortgage insurance policies in order to make refinancing less rigid for homeowners who are adding secondary living units to their properties. These policy changes could result in better loan terms and/or higher loan amounts, which would make it cheaper and easier for you to create additional living spaces in your home. - Encouraging Densification and New Housing Options
Zoning reforms and financial subsidies are working together to let homeowners help solve the housing crisis—and, at the same time, create personal spaces that are accessible and comfortable for tenants or family members. When you add rental units to your home, you not only provide something that is much-needed by your family, but you also increase the housing density in your community.
How Kozak Reno Can Help You Take Advantage of These Programs
- Adding a secondary suite to your home is a big step, and the not-for-profit Kozak Reno Home Addition Company in Toronto can help you make it with confidence. That’s because they have a trusted blueprint for not just constructing, but also for navigating the new opportunities associated with home additions, including secondary suites. Here’s the basic layout of that blueprint:
- Kozak Reno focuses on home additions, especially in challenging cases like converting basements, garages, and attics to legal and comfortable living spaces. They know the many municipal zoning and building requirements specific to the Greater Toronto Area (GTA) and can help you navigate the process of getting permission and the necessary permits to go ahead with your project.
- Complete Management of Your Project From first contact and the applying for permits through to last inspections, Kozak Reno guarantees that your project meets all necessary federal and provincial standards. Their project management service allows for your basement’s promised-to-be transformation to happen without a hitch while maximizing the benefits you receive from government programs.
- Kozak Reno provides custom designs that meet barrier-free requirements whether you’re planning an in-law suite for aging parents or an accessible space for family members with disabilities. These are not just spaces that are up to code; they are highly functional and very comfortable. They allow your loved ones to enjoy their independence while living close to you.
FAQ
What new measures are included in Budget 2024 for homeowners who want to add rental or family suites?
The 2024 budget presented a new initiative called the Secondary Suite Loan Program. This program offers low-interest loans of up to $40,000 to Canadian homeowners. The goal is to provide financial assistance for the creation of “secondary suites,” which can mean anything from a basement apartment to a backyard tiny home.
Why is the government encouraging homeowners to add additional suites to their homes?
It is partially about density. I think it is important to have a conversation about what density means, particularly in our urban and suburban areas. There are a number of reasons it makes sense and is necessary, and part of that conversation has to do with the increasing access to rental properties in these areas. And the reality is that we have a very low rental vacancy rate.
How will the Secondary Suite Loan Program work?
It will allow people to apply for a low-interest loan of up to $40,000 to build secondary suites in their homes. The money can go toward any number of things necessary to see these suites become a reality: construction, for one; then finishing, a term that encompasses everything from flooring to final inspection; necessary accommodations that make these spaces accessible to people with disabilities; and a few other details that, if not addressed, could lend themselves to a lawsuit.
Are there any specific changes to mortgage insurance rules?
The government is proposing specific changes to the regulations surrounding mortgage insurance, including rules about refinancing; the maximum amount you can borrow; and the price of the home itself. The changes are meant to make it easier for people who own single-family houses to add units—like a basement suite, for example—to their homes.
How do municipal zoning reforms impact this initiative?
The recent zoning reforms stemming from the Housing Accelerator Fund have lowered regulatory hurdles. They have also cut costs and reduced the number of permits necessary for homeowners to add secondary suites in our largest cities. These reforms, in fact, make it much easier to densify our urban centers.
Can homeowners use this loan program to create accessible living spaces for family members?
Yes, the program absolutely supports creating those deep, accessible living spaces within homes.
What other housing initiatives are part of Budget 2024?
Among its many housing initiatives, Budget 2024 contains a shiny new $6 billion Canada Housing Infrastructure Fund. But like most of the other notable steps it lays out to help provide housing to more Canadians, this fund, too, is riskily dependent on private sector participation.
Is there any tax benefit for adding a suite to my home for a senior family member or adult with disabilities?
Yes, indeed. The home-renovation tax credit that was introduced in 2023 allows for up to $7,500 in tax deductions when you create a secondary suite, provided the person living in it is either over 65 or has a disability.
When will Budget 2024 be presented in the House of Commons?
It will be presented by the Deputy Prime Minister and Minister of Finance on April 16, 2024.
How does the government plan to increase affordable housing across Canada?
Beyond programs for individual homeowners, the federal government has initiated something called “Canada’s Housing Plan.” This strategic initiative aims to work with the provinces and territories to increase the number of new housing units across the country by a total of 3.87 million by the year 2031.
