So you want to build a LEGAL SECONDARY DWELLING UNIT IN YOUR HOME?!
It’s an excellent idea, and can generate very attractive positive cashflow for many home-owners in Ottawa. And it’s also one of my favorite styles of investment around here, and here’s why; cashflow, accessibility, and affordability.
CASHFLOW: The numbers on these things CAN be very attractive, and are quite often better than the usual residential investment property (disclaimer: these investments are not always a winner, and the numbers to be analyzed very carefully). The cashflow (or ROI, or cash-on-cash return; however you look at it) can be very healthy depending on what, where, and how you build it (contact me for a more detailed look at the numbers).
ACCESSIBILITY: You can find these opportunities out there, and they’re typically in the form of single family bungalows, and occasional semi-detached. Finding a bungalow in Ottawa under $400k is still doable. There are a few pockets of this city that offer these, however it’s getting a little harder to find as these are becoming the hot ticket around here. These legal secondary units can also be done in semi-detached homes, which are also fairly readily available at any given time of year. Again, contact me for a current list of these properties that will work for bungalow conversions to legal apartments.
AFFORDABILITY: Where many multi-unit buildings are extremely expensive and hard to get into, the purchase prices on these bungalows are usually affordable for the average investor (ie. homes under $400k). And this affordability is a HUGE key factor. If you can’t afford to purchase a real estate investment, you’re already at a roadblock. Not many investors have a couple million lying around to get into a large multi-unit or development. But getting approved for a purchase of a home asking $399k is doable for most. And if you’re really good, you can refinance your legal 2 unit property, and take that equity and move on to do another one…. and another…. and another one… you get the picture 😉
I better step in and say that this process of converting a house to a legal secondary suite is not as simple as it sounds. There are certainly a number of people out there who think that they can throw a kitchenette, a bedroom, and a bathroom in their basement, and BAM, they have a legal rental suite. Well, it just doesn’t work like that. There are a ton of building codes, fire codes, zoning compliance issues, and numerous costs that all factor into this equation. And if you make one mistake, you can end up in a world of problems.
For some general info on what the City of Ottawa’s requirements are for these legal in-law suites, CHECK THIS OUT.
For more guidelines on building codes, unit requirements & restrictions, check out what CMHC has to say here.
As a professional who has successfully been through the process of converting multiple homes into legal 2-unit buildings, I am very happy to help you locate, secure, and execute one of these projects. Contact me and let me help you get into a solid, CASHFLOWING property here in Ottawa.