I received a phone call the other day from a former client, let’s call him Joe. After exchanging pleasantries, Joe went right into the purpose of his call: “Stevie, what’s the scoop on basement apartments in Brampton anyway? Are they legal or not?”
Joe was considering an investment fixer-upper in B-Town. The plan was to find a property with great potential, situated near local conveniences such as schools & transit, renovate it completely, adding a full basement apartment suite, then reselling for a tidy profit. Sounds simple enough? Well, at least that was the plan.
As a self confessed attention-to-detail-nut, I put on my research hat and went fishing for answers. What was uncovered along the way proved useful not only to the Joe’s of the fixer-upper world, but to current home-owners and regular would-be buyers as well.
- In 1994, the Government of Ontario introduced Bill 120, allowing second units in homes (i.e. basement apartments.)
- The bill permitted the units to trump the City of Brampton’s then current municipal zoning bylaws, as long as they met health and fire safety standards.
- One year later, on November 16, 1995, the Government reversed course and introduced Bill 20, restoring to municipalities the right to outlaw basement apartments.
- Bill 20 became effective on May 22, 1996.
- To be considered a legal basement apartment, homes had to be built before November 16, 1995 and registered with the City of Brampton before January 31, 2006. (Exceptions apply to those granted legal non-conforming status.)
- Any basement apartment built after November 16, 1995 is considered illegal in the City of Brampton.
- A single or semidetached registered home can only have one basement apartment.
- The City strictly prohibits subdividing into more than two units, unless the property was specifically zoned to permit multiple units. As a result very few properties have been zoned triplexes.
- To secure approval, all legally registered basement apartments must comply with current Building & Fire Code standards.
- Any modification (or adding additional units) requires a building permit as well as arranging for City staff to inspect the property before construction begins.
- Ensure your Realtor and/or lawyer confirms with the City that the property does indeed have a legally registered basement apartment OR is legally non-conforming, and is in full compliance with all the relevant Building and Fire Codes.
- Always get such “proofs” in writing from the municipal body.
- Peace of mind: From a litigation perspective, it’s far easier to sleep at night knowing the law is on your side than fearing the complete opposite.
- Reduced liability: Obtaining insurance coverage for a legal basement apartment (or legally conforming) should be a cinch!
- Increased liability: In the event of a fire, injury or worse, a loss of life resulting from not meeting the required standards, there’s no escape; you’re on the hook both legally and financially.
- Loss of insurance coverage: Adding a rental suite to a property is considered a major modification. If your insurance provider is not made aware, this could in fact render the coverage for the rest of the home “null and void.” Not a pretty, scenario. Trust me.
- Limited damage recovery: Most policies will not cover the costs of rebuilding your home to meet current standards. As a rule, the policy is stipulated to cover the costs of restoring your home to the state that it was in when purchased.
- Prosecution: Not meeting City codes simply means you are breaking the law. You can be charged & face fines as stiff as $50,000, or 1 year jail terms per charge.
- Financing – Hoping to use the rental income to offset expenses or boost your total income when applying for a mortgage? Not so easy: most lenders will not consider the income from an illegal basement apartment as a legitimate source.
- Tenant insurance – A typical homeowner policy will not cover tenant’s personal belongings.
- The answer seems to be a resounding no. The City of Brampton’s zoning bylaw does not permit new basement apartments. If a basement apartment was not present prior to November 16, 1995, you are simply not allowed to add one.
“Is there any way around this?”
- Sure, you must get the green light from the City to change the zoning bylaw. Umm, good luck there.
- Submission of a zoning bylaw amendment application and a fee of $7,759 to the City’s Planning, Design and Development Department.
- City staff holds public meetings to allow anyone living within 800 meters of the property — or any other individual or entity interested in your application to comment.
- A sign is posted on the property, detailing the nature of your application.
- Department staff processes the application and recommends whether or not City Council should approve your application to change the zoning bylaw.
- City Council decides whether to approve or refuse to change the zoning.
- City Council’s decision is not final as an appeal could be made to the Ontario Municipal Board. Umm, again, good luck there too. The process is not for the faint of heart or budget conscious individual.
- The zoning amendment process can take about six months to a year to complete.
So what did Joe decide to do in the end? Well, after our little analysis Joe felt more comfortable pursuing greener pastures elsewhere…