While it is still relatively rare, we are starting to see some homes in Toronto and the GTA that have built out an accessory dwelling unit on their lot, in the form of a laneway house or garden suite.

As provincial and municipal governments made changes to legislation to allow such additions to be built, we have started to get questions from our clients.  In some cases, they want to know what the return on investment would be if they built one, but the more common question is whether one of their neighbours would be allowed to do so.

That is a complicated question and we thought we’d spell out some of the history around laneway houses and garden suites and talk about the current state of affairs in Toronto and the GTA.

First, a history lesson.

For quite a while, there wasn’t too much going on with this type of housing, as Ontario’s zoning laws did not allow detached secondary dwellings, such as garden suites or laneway houses, in most urban residential areas. While basement apartments were permitted in some cases, separate backyard or laneway homes were not widely accepted.

In the early 2000s, Ontario introduced policies supporting additional dwelling units (ADUs), but local zoning bylaws remained restrictive. In 2018, the City of Toronto amended its rules to allow laneway houses—small residential units behind existing homes, facing laneways. This marked a significant step toward legalizing detached ADUs, but it faced consistent local opposition and we didn’t see much uptake despite it being technically allowed.

In 2019, the Ontario government updated the Planning Act to require municipalities to permit both garden suites (detached backyard homes) and laneway houses. In 2022, Bill 23 (More Homes Built Faster Act) further expanded these rights, allowing up to three residential units per lot (one primary dwelling and two additional units, such as a basement apartment, garden suite, or laneway house).  Again, despite the fact that it was permitted by legislation, municipalities were given the ability to set the parameters around how such approvals would be granted – or denied.  In many cases, the requirements were so stringent that very few properties would actually qualify for approval.

Since then, while many Ontario cities have updated their bylaws to support these housing options, challenges remain, including high construction costs, infrastructure limitations, and municipal approval processes. Efforts continue to streamline regulations and increase adoption of garden suites and laneway houses as a way to address housing shortages, but in our opinion, it remains a very, very small part of the housing market and will not make a material impact on housing affordability.

Not in my backyard!  Wait, not in my neighbour’s backyard, please.

The question of whether a laneway house or garden suite can be built on a given property is very much dependent on the municipality and the requirements they set for approval of a laneway house or garden suite.

When the City of Toronto began establishing the regulations for garden suites back in 2019, we were part of a TRREB committee that was part of the consultation process.  During that meeting it became pretty clear that while Toronto – like all municipalities in Ontario – was required to allow garden suites under the revised Ontario Planning Act, they weren’t going to make it possible for most properties to qualify.

In the years that followed, we saw very restrictive requirements set in many municipalities in the GTA.  While major urban centres like Toronto have arguably the highest need for increased density, they also tend to have much smaller lot dimensions than in other parts of the 905 area code.  At the same time, properties in smaller towns or more rural settings often have larger lots, but little demand or interest in building ADUs onto those properties.

A good starting point for determining if you (or your neighbour) can (or can’t) build a laneway house or garden suite is the local planning department.  Here’s links to them!

These websites provide the most up-to-date regulations and planning guidelines for laneway houses and garden suites in each region and are the start of the journey to determining what is possible for a given property.  Depending on where you live, you might be better off starting at your municipality planning department as they may very well have their own version of what is permitted for ADUs.

If you’re looking for more detailed information or trying to sort out the feasibility of creating an ADU on your property, we’re happy to provide an introduction to professionals who work in exactly that field.  Get in touch with us with your specifics and we’ll make it happen!