Secondary suites make homeownership more affordable for cash-strapped buyers

Homes with secondary suites have been a hot topic in Calgary for years, but their appeal for homebuyers looking to generate extra revenue is only growing amid adverse economic conditions.

It is important to find out whether the secondary suite in a home is legal before making any purchase, which can be done by going to the City of Calgary’s website, www.calgary.ca/suites.

If a suite is illegal and a neighbour complains about noise or parking from a tenant, then a bylaw officer can come out and shut you down, meaning you’d have to tell your tenants to leave.

The best place to buy a home with a suite is typically near large employment centres, such as commercial or industrial areas, hospitals, universities, or downtown, as these are the areas where tenants want to live.

When it comes to homeowner demographics, baby boomers or other empty nesters like the rental income a secondary suite can provide, while younger homebuyers often use the added income to be able to buy a home in the first place.

The improvement of the Calgary housing market continued in December with further stability capping off a stronger second half of the year.

New figures from the Calgary Real Estate Board show that activity returned to levels close to those seen in the past five years with annual sales up 1%.

“Price declines, lower mortgage rates and some modest improvements in full-time employment helped support some demand growth in the city. Reductions in supply are also contributing to the slow adjustment to more stable conditions in the housing market,” said CREB® chief economist Ann-Marie Lurie.

Annually, the attached homes segment was the star performer with sales up by nearly 7% for a total of 3,780 sales. Apartments just outpaced year-ago levels with 2,672 units sold, while detached sales were broadly in line with those of a year earlier.

Price pressures
Overall prices in 2019 declined by 3% year-over-year, marking a 10% decline since the 2014 slowdown in the energy sector.

“As oversupply in the market continues to ease, we should start to see more stabilization in prices. However, conditions continue to favour the buyer and this is weighing on prices,” added Lurie.

For December, attached sales were up 14% to 220, apartments gained 27.6% to 134 sales, and detached sales increased 1.6% to 504.

December’s unadjusted benchmark prices were $418,500, just slightly lower than November and 1% below last year’s levels.

Detached benchmark prices were $480,100 in December contributing to the 2019 average of $484,808, three per cent below last year’s levels.

December semi-detached prices were $388,200 and row prices were $283,000. Both segments saw annual price declines in excess of three per cent and remain well below previous highs.