• We continue to monitor trends for the Hamilton Ontario real estate market at Robert Floris’s Office . Below is a very interesting article. Let’s suppose this alderman gets his way, what could happen?Well realistically  a couple of ideas come to me. This just may be terrific news for LEGAL units since illegal unit tenants will be scrambling to find suitable rent. This could create a shortage as well , if the numbers are correct and 90% of the units are illegal there would be quite a demand for LEGAL Units. As well the owners of such housing will get a premium for their rent, at least in the short run until more units become available. Stay tuned


    A city councillor in the country’s hottest market is spearheading a move to crack down on the illegal conversion of secondary suites – something that could affect 90 per cent of investors.

    A city councillor in Hamilton, Ont. is aiming to board up illegal secondary suites, a measure bound to impact investors who depend on that rental income to cash flow.

    Councilor Matthew Green has filed a motion that would see the municipality allowed to amend a policy around the conversions of single-family houses so as “not to continue to reward those property owners”.

    The request asks the provincial government, through the Minister of Municipal Affairs and Housing, to amend its planning act to prohibit applications to renovate a property, such as the conversion of a secondary suite, if construction on the property has already begun.

    “There are many in our community who have serious concerns regarding improper conversions of single-family housing to duplexes by property owners who do not apply for, or have approval to, by our City’s planning department in advance of construction,” wrote Councilor Green.

    “What we’ve seen in these instances are ‘investors’ who purchase in our neighbourhoods and begin conversions from single-family to multi-unit apartments with three, four or five units intended.

    “When they are caught by our bylaw staff, they simple apply for the approval through our committee of adjustment or, if necessary, to the Ontario Municipal Board.”

    In Hamilton, it is a classic strategy for investors to start renovations on a secondary suite and then apply for permits. In fact, Erwin Szeto, an investor and local sales representative with Rock Star Real Estate, estimates that 90 or 95 per cent of Hamilton apartments, such as duplexes, triplexes and four-plexes, are not conforming to building code.

    But the approval of a basement suite, which is done through the Committee of Adjustments, could take a number of months, so many investors and property owners take the risk.

    However, the fine for non-conforming additions starts at $1,000 – a significant amount in a rental market that ranges from $400 to $1,100 a month.

    The proposed motion was put forward in a planning committee meeting at the beginning of March. Green asked the provincial government to administer Municipal Affairs and Housing “to amend its planning act to prohibit application for minor variances on any other planning approvals to permit the second-unit conversion if an owner undertakes, or has undertaken, actual conversion before first seeking such planning applications.”

    Szeto adds: “That’s very nasty to us investors since the city is so difficult to deal with for permits as anyone will tell you.”
    Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage.

    Robert Floris is an independent mortgage broker for Mortgage Architects in Hamilton

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