Adding a secondary suite or a laneway home to your property, especially in existing high-density areas of the GTA, can serve multiple benefits. It can:
- Add value to your property
- Provide affordable housing for a family member, relative, or friend
- Create an option for those struggling to find a home
- Deliver income from a rental or lease to assist with paying down your mortgage and construction costs
- Increase housing density in the city
So why aren’t more secondary suites being built?
Secondary Suite Incentive Programs
As discussed in our previous blog on federal housing financing incentives, banks, financial institutions, and other lenders have been slow to roll out their financial program offerings, including both federal loan options.
To be sure what is available, contact your bank or lender to see if they have developed a program that offers the federal government’s incentives and financing plan.
Uncertain Value
While it may seem like a slam dunk that building a secondary or laneway suite will add value to your property, some Toronto homeowners have had trouble selling after they built.
It’s not that the property isn’t worth more money; it’s that some buyers don’t need or see a future use for the supplementary housing density. As a result, an appropriately priced GTA property may sit on the market for longer than a standard detached home because fewer buyers want or need the additional living space.
According to the real estate insider, GTA properties with laneway suites (only the type of secondary suite that exists on a public lane) have typically stayed on the market for around nine months before finding a buyer.
2025 Secondary Suite Home Prices
The Toronto Star reports that three Toronto properties with secondary suites were on the market in March. All three have seen significant drops in listing price, from $240,000 to $350,000. While these are worth noting, another property sold for above asking price, and it was only on the market for six days.
With so little market inventory of this type of housing, even appraisers are struggling to estimate the value of adding a secondary suite. As a result, if you are planning to add a secondary suite in hopes of selling in the next few years, you may need to reconsider until the market sorts itself out.
Do I Build a Secondary Suite?
So, while in the early days of these inviting financing options, it may be hard to sell your property after building a secondary or laneway suite, there are exceptions.
In the meantime, deciding to take advantage of the available financing may be more personal until sales of similar properties become common and the market learns how to assess and react to this type of increase in housing density.
Whatever you decide, follow the federal government guidelines and work with your financial institution and real estate agent to ensure you make the best decision for you and your long-term future.
Are you ready to move to the next stage? Let’s chat. Send me an email (hillary@hillarylane.ca) or text/phone (416-882-4707).
