download springup method home selling guide

Laneway housing not as affordable as you might think…

Recently the City of Toronto has taken steps to increase rental housing supply in traditionally low density, desirable neighbourhoods by adopting a zoning amendment to allow for the creation of laneway housing. Per the city of Toronto,

“A laneway suite is a self-contained residential unit located on the same lot as a detached house, semi-detached house or townhouse, and generally located in the rear yard next to a laneway. Laneway suites are generally smaller in scale and completely detached from the main house on the lot .Laneway suites may provide new rental housing opportunities within established neighbourhoods, providing a wider range of low-density housing options while enhancing neighbourhood and community character.“

Toronto has up to 300KMs (we’ve seen estimates ranging from 250-300Kms) of laneways, which until now, have been used to access garages and rear parking pads. Imagine transforming these few hundred KMs of grungy overgrown laneways into quaint and quirky laneway neighbourhoods. A win-win for everyone!

This is great for families with aging parents who want to keep them close, but not sacrifice a second bedroom or their own privacy. Also, it allows seniors to maintain some independence, which has been shown to extend quality of life.

With the high cost of education and rent and the low wages most recent grads are faced with, timelines to independence and home ownership are lengthened. For those families with younger dependents, this can also be beneficial in keeping your kids off the streets, but out of your hair.

You’ve built a ton of equity in your current home, but, if you sell, where are you going to go? Tacking a laneway house on top of your garage can allow you to use that equity for a rental suite, (or let’s be serious, an Airbnb), or a cool home office. Using equity to build even more equity is an easy decision.

A rendering of Toronto developer Brandon Donnelly’s laneway house

So, Laneway housing will add to our current low rental inventory, it’ll allow more access to in demand neighbourhoods, it’ll help our youth and our olds (who we love) – Why don’t we like it?

City councillors feel that an added benefit of laneway housing would be a removal of personal parking spots. During a Council meeting, Gord Perks said

“To my mind, any time you can convert a place for a car to a place for a human being, it’s a win.”

We agree with the sentiment, but we’re calling bullshit here. A private covered parking spot is far too valuable in downtown Toronto. We predict most laneway houses will be created above a garage. So, no, we aren’t replacing parking with people, we’re creating walk up laneway housing, which doesn’t help anyone who needs accessibility.

Sure there are many lots that don’t have a garage and a nice laneway home will fit perfectly at grade to allow for an accessible home. But let’s be real here. Put yourself in the shoes of the homeowner who’s considering a laneway home. Would you choose to not maximize your return? To not build as much equity with your equity as possible? No. You’re going to do what it takes to maximize your investment. You’ll want your cake and eat it too….that means finding a way to maintain your parking space whilst adding a laneway home.

Based on research of available options, and some anecdotal evidence of folks who built laneway housing in Vancouver, the cost to build a laneway house is between $250,000-$500,000 with the majority in the upper ⅓ of that price range. At half a million bucks, there’s nothing affordable about laneway housing. With newness, hipness and a neighbourhood premium we predict rents for laneway housing will be in the upper upper range of the rental spectrum and any that end up in the resale market will fetch upwards of a million dollars.

So, what has to happen to actually increase affordable housing, and reduce vehicle dependence among our more established neighbourhoods? Simple. Transit flexibility and density.

Thankfully, and can we say FINALLY, in August, any presto ride will give you a 2 hour timed transfer, which will allow commuters to run errands without being penalized an extra $3.

The TTC is also thinking about how to address the ‘last mile’ problem of transit. How do you get people from transit stops to their homes in an efficient way?  They’re planning driverless shuttles, which is the stupidest thing ever, but that’s probably fit for another post.

Wepod driverless shuttle (via WePod)

Closely related to transit, is density. Toronto’s lack of density in well serviced neighbourhoods is one of the biggest reasons why there’s a housing crisis in this city. There’s no reason why Yonge St. and the Danforth should have 2 storey buildings when we’re this desperate for housing. Roads that are serviced by a Subway should allow high rise developments, and roads serviced by a 24 hour bus or streetcar line should be zoned for mid rise at least.

One area where we’re doing this right is on Kingston Road. From Woodbine East into Scarborough, large lot single family bungalows are being snatched up and developed into 7-9 storey condo buildings. “ It’s exploded,” says Scarborough Southwest councilor Gary Crawford. “We’re seeing an incredible amount of applications, and all combinations of mid-rise and detached townhomes.”

I’d love to see City Council make it much easier to turn those “detached home” applications into multi unit residential options within residential neighbouhoods. It’s absolutely insane that it’s easier to tear down an old home and build a McMansion instead of being able to build a home with 3-4 units in it. That’s how you really put a dent in the supply problem Toronto has. Laneway housing is a cute idea though…

Thank you so much for your attention! Hopefully you found this content useful. If so, make sure you’re subscribed to the industry’s “least spammy newsletter!” to be kept in the loop. We’ve got some great resources for Buyers and Sellers here too, so check that out and keep in touch, will ya?

Don’t forget, you can always call, text (416-434-1511) or email (  if you have any comments or questions. Also, feel free to comment below!

Get the latest news and updates on listings

Remember, if you’re not seeing a home within the first 24hrs on market, you could be too late, so make sure you sign up for our REAL TIME property match system to be updated the moment a house hits the market in your favorite hood. You won’t miss another one…ever.

  • This field is for validation purposes and should be left unchanged.