Secondary suites poised to diversify housing, rental markets

By Sean Feagan, Local Journalism Initiative Reporter

The Town of Strathmore is looking to amend its land use bylaws to add secondary suites as a discretionary use, a move that would impact its housing and rental markets.
On Feb. 19, Strathmore town council passed the first reading of an amendment to its land use bylaws that, if passed, will make secondary suites a discretionary use within low density districts. This means property owners looking to add a unit will have to jump through one less regulatory hurdle, thus saving them time and money.
The move will benefit homeowners and will provide prospective renters with more housing choices, said Justin Rebello, Strathmore’s manager of development services.
“By allowing secondary suites to be a (discretionary) use, and to go through a legal and safe process, we are confident that the policy can help homeowners improve their market value and will increase the supply of rental accommodations,” thereby “stabilizing the rental market and help make it more competitive,” said Rebello.
A more diverse housing market will allow Strathmore to attract people at different stages of their life to the town, he said.
“We’re just trying to provide as many options as possible to residents of Strathmore,” noted Rebello. “One of our guiding principles is trying to create more housing choices within complete communities.”
The bylaws were scheduled for second and third reading on April 1, following a public hearing. However, those votes may be delayed as the town responds to COVID-19, he said.
The notion that secondary suites decrease property values is “completely incorrect,” said Rebello.
“A secondary suite is quite a large investment for the homeowner – it could cost anywhere from $15,000 to $50,000 to build a legal secondary suite that meets Alberta building codes,” he noted. “When an assessment is done when someone is reselling it, the value that you put into the home in terms of a separate kitchen or dual fire alarms, furnaces and bathrooms actually increases the value of the home.”
According to Rylan Graham, urban planner and postdoctoral associate at the University of Calgary’s Haskayne School of Business, because secondary suites do not change the exterior of the home, they are considered “hidden density,” meaning their impacts to communities are less than what is sometimes anticipated.
“Most people wouldn’t even know it is there; and if you don’t know it’s there, it’s difficult for that to be incorporated into property values,” said Graham.
Facilitating secondary suites could make homes in poor condition more attractive to prospective buyers, he added.
“If you think about a house that is on the market that maybe has been neglected, and now all of a sudden, it’s appealing to a purchaser to buy it and invest money back into the house by renovating it and putting in a secondary suite,” he said.
“Taking a house that is neglected and dilapidated, then reinvesting in it – I would argue has a positive impact on the community.”
Secondary suites allow people to reinvest in their home while improving the quality of housing stock. Developing a secondary suite can also help ease the financial burden of home ownership, which includes taxes, insurance and mortgage, which is of help to first-time homebuyers.
There are also wider benefits of secondary suites to the community, said Graham.
“It’s a way to gently increase the population density of a neighbourhood, which is a more fiscally responsible way of growth, as it allows municipalities to accommodate population growth and development in areas where infrastructure (roads, utilities) and services (sanitation, transit) are already in place.”
While Graham said “it’s not a yes or no answer,” as to whether secondary suites increase property values, because “values always reflect a range of factors that are perceived as positive or negative,” there’s more evidence for the benefits of secondary suites than any potential downsides.
“These policies should be driven by evidence, and there is evidence to support that secondary suites are part of the actions that need to be taken towards more sustainability, versus the narrative that persist that secondary suites are negative on property values,” he said.
“If municipalities are trying to become more sustainable – economically, environmentally and socially – there is evidence that secondary suites are part of that transition.”