Housing is a necessity. In a city like Toronto, creating more housing has become incredibly imperative. Making secondary suites would go a long way to ease the housing crisis that the city faces. Secondary suites can help make an expensive home more affordable for someone to buy. It also creates a more affordable space for someone else to live.
Located on the shores of Kempenfelt Bay, the city of Barrie is a part of the extended urban area in southern Ontario, which is also known as the Greater Golden Horseshoe. It is one of the most expensive rental markets in Canada.
Nearly one out of six ground-levelled homes in Toronto have a secondary unit, which totals an estimated 75,000 secondary units throughout the city, according to a new Housing Market Insight released by Canada Mortgage and Housing Corporation (CMHC).
Advantages of secondary suites
- A solution to the lack of affordable housing
- Extra rental income
- Increased property value
- Mortgage financing is significantly increased
- More low-income families and individuals can live in safe housing
- Increases affordable housing stock by contributing to the City of Barrie's plan in creating 840 new affordable housing units by 2024.
- Decreases the waiting period for affordable housing for those in need.
Secondary Suites in Barrie
Secondary Suites, or basement apartments, have been on the rise in many provinces of Canada. A secondary suite is a standalone unit with a kitchen and a bathroom within the primary structure on a property (typically found in the basement of a house). It is often used as a rental property and must be registered with the City authorities.
According to PadMapper, one and two-bedroom apartments in Barrie have an average cost of $1730 to $1920 respectively, in July. Barrie is not abundant in high rises, unlike the largest Canadian city. However, the resulting rental supply crunch is the reason behind the rising prices. Therefore, secondary suites are beginning to proliferate in the city.
Municipalities that have a low supply of purpose-built condominiums and subsidized rental housing, like Barrie, tend to have a higher ratio of properties with a secondary unit.
Due to the smaller floor area and design, single-story homes are more likely to have a secondary suite. The secondary units are prevalent in older neighbourhoods, which are highly coveted by renters as they are close to downtown areas and have major amenities.
What is causing the rapid changes in Barrie?
Barrie has undergone major changes over the course of the last few years. It has embraced the budding urbanism that includes rejuvenation of the Dunlop Street West close to its six-kilometre waterfront. Moreover, the city is expected to have up to 210,000 new residents in the next decade and about 129,000 jobs by 2041.
However, COVID-19 kicked migration to Barrie in full throttle. This has created a robust demand for housing in the city. The city lately has attracted a lot of buyers from the GTA because of the comparatively larger lots. Now, single-family homes that were sold for $600,000-700,000 a couple of years ago, are now pushing for $1 million.
Garden Suites in Barrie
The government authorities of Barrie have made it legal to construct garden suites. Now, without any kind of zoning restrictions, you can have a single-family home and also build a separate and detached garden suite in the backyard. The Garden suite can take up to 10% of your lot coverage. This construction would not charge any development costs at all. All one would need is a permit.
Why are the Interest Rates on Secondary Suites Rising in Barrie?
One of the factors that have added to the increased rent in Barrie is the need for housing for students. International students at the Georgian College are driving the North and East-end rental markets.
A second factor, that has ensured the rising and demanding prices of suites in Barrie, is its safety. Hailed as one of the safest cities in Ontario, Barrie now has a growing hospital with a medical campus that is attracting a lot more attention for people to move here. The pandemic has only put a magnifying glass on it.
How did it affect the Investor and the Market?
In the last 16 months, 50 garden suites have been added to various properties around Barrie. It has opened up the market for investors. It has also caused a surge in the rent prices. The main floor of a duplexed bungalow can be put on rent for about $2,000, while the basement for $1,750-1,800. About 65% of the buyers of such properties in Barrie are from the Greater Toronto Area.
What did the Government do?
Ontario is proposing to make it easier to build secondary suites and rental housing in an effort to increase the supply of housing properties. The government has made a proposition to eliminate the charge for creating a secondary suite in new homes thus allowing homeowners to create units above their laneways and garages.
The charges for building rental spaces and non-profit housing would be deferred. It would allow the developer to pay in instalments over five years once the building is occupied. Interest will be charged by the Municipality. According to the Ontario Home Builders’ Association, these new and inclusive changes will remove the barriers, thus providing more housing to those in desperate need of it.
However, such development comes with its own backlogs. Many people moving in from the city is bound to disturb the peace and quiet of Barrie. The city additionally is also doing a review of the by-law for garden suites to see if they need regulation for size or application process. The rental demand will depend on the city’s decision and laws.
Barrie City Hall. Photo Credit: barrietoday.com