With higher costs of living and house prices, many homeowners are looking for ways to supplement their income and lower their mortgage payments with rental units. Here in Canada we have a few incentives that have been recently released to assist those wanting to add rental units to their property. Let's take a look!

PROVINCIAL

SECONDARY SUITE INCENTIVE PROGRAM

Introduced in April 2024, this three-year pilot program from BC Housing provides financial support to homeowners for building long-term affordable rental units. 

Qualified homeowners could be eligible for a forgivable loan covering 50% of construction costs, up to $40,000,  for installing a new long-term rental unit. For the loan to be forgiven the unit must be rented out at below-market rates, set by BC Housing, for a minimum of five years. Check Homeowner Eligibility. 

• Must be rented out at below-market rates for at least five years (rates set by BC Housing)

• The rental unit must be on the property of your primary residence

• Can either be a secondary suite or a detached unit (garden suites, laneway homes, carriage house, etc.)

• The rental unit must be a complete unit with its own entrance, kitchen, washroom, and sleeping area, please see Nanaimo Secondary Suite Guidelines.

Some important considerations are:

• Confirming costs

• Researching a rental plan

• Obtaining a building permit

• Obtaining an occupancy permit upon completion

For more information and program criteria, please see BC Housing’s Program Guide.

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FEDERAL

CANADA SECONDARY SUITE LOAN PROGRAM

This program is set to launch in ”early 2025”, and has yet to be released. It will allow qualified homeowners to access a low interest loan, of up to $80,000, at 2% interest over 15 years. See this 2024 Fall Economic Statement for the most recent announcements. 

More information to come.

MORTGAGE REFINANCING FOR SECONDARY SUITES

Though the federal government has released details and parameters for this new incentive, most lenders and insurers have yet to pick up this program. When refinancing, qualified homeowners will have the ability to borrow up to 90% of their property’s projected value, to build or complete up to 3 additional rental units on the property of their primary residence or second home. 

• Mortgage will be an insured mortgage, allowing selection of the best rates and the option of a 30 year amortization (note, an insurance premium will be added to the mortgage)

• Additional units must be legal, please see Nanaimo Secondary Suite Guidelines.

Contact us for more details and important considerations.

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If you have any questions on the above programs, please don't hesitate to reach out!

OAC, E&O