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#41 Sparky

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Posted 16 April 2010 - 12:37 PM

^ I agree Bernard. The term "Mortgage Helper" was probably devised by a realtor with the thought of "commission" on his mind.

#42 phx

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Posted 16 April 2010 - 07:08 PM

You have to wonder why there is a demand for illegal suites. Are there new rental apartment buildings being constructed in Victoria these days? I've read that there have been very few built in Vancouver in the past ~30 years due to being uneconomical.

I wonder what rents would have to be to make it worthwhile.

#43 concorde

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Posted 16 April 2010 - 07:41 PM

My opinion is that if you have to have a secondary suite in your house, you can't afford your house. Back east you are considered to be very poor to have a stranger living in your house!

Crack down on illegal suites and I would bet average real estate values would fall 30-40%.

#44 pseudotsuga

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Posted 16 April 2010 - 08:08 PM

I would have no problem owning a place with a well built, sound proofed suite.
Extra income is always nice and the work required is pretty minor.

If there was a sudden crackdown on illegals, where would all the students live?

#45 mat

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Posted 16 April 2010 - 08:31 PM

My opinion is that if you have to have a secondary suite in your house, you can't afford your house. Back east you are considered to be very poor to have a stranger living in your house!

Crack down on illegal suites and I would bet average real estate values would fall 30-40%.


Concorde - love your posts as they are usually spot on, but to say that "back east you are considered poor to have a stranger living in your house"?

Where? Friends and family 'back east' either rent SMH suites to others, or happily live in them - from Winnipeg to Montreal. Never heard of any situation where either a renter or landlord was considered 'poor'. It is as large a part of the real estate culture, and economy, as here in Victoria.

Houses are being sold as having the advantage of a secondary suite, but show the data where a mortgage broker, or bank, is offering a loan based on that income. Not saying it does not happen in isolated cases - just not the norm.

#46 Holden West

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Posted 16 April 2010 - 08:42 PM

Houses are being sold as having the advantage of a secondary suite, but show the data where a mortgage broker, or bank, is offering a loan based on that income. Not saying it does not happen in isolated cases - just not the norm.


A mortgage broker or bank will take into account rental income from a suite (legal or not) when determining the buyer's ability to purchase the house. The only thing is, in the last couple of months there's been a change in how the figures are calculated which is no longer to the buyer's advantage.
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#47 Ginger Snap

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Posted 16 April 2010 - 10:14 PM

Thanks for straigthening the facts that I was a bit sloppy with, heheh. I admit that for the average homeowner, there appear to be more pluses than minuses - I think, though, a program like this is tougher to swallow for folks who have a general mistrust of their (local) government.

Re: BCA sophisticated suite tracking tactics - do you have any firsthand info that you'd care to share with us?


Maybe sophisticated is not quite the right word. I meant to say they don't just sit around and wait for a suite to be declared legal before they base an assessment on that.

Look at a house one year and it has a garage with a garage door - the next year where that garage was is now an entry way. Also the same house now has an additional cable line running to the house - those are a few of the things they look at.

#48 Bob Fugger

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Posted 17 April 2010 - 05:50 AM

A mortgage broker or bank will take into account rental income from a suite (legal or not) when determining the buyer's ability to purchase the house. The only thing is, in the last couple of months there's been a change in how the figures are calculated which is no longer to the buyer's advantage.


It depends entirely on the lender: there is no regulation or industry standard. Some will take 50% into consideration (well I guess that is the unofficial standard), but other lenders take more: all the way up to 100%.

#49 gumgum

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Posted 17 April 2010 - 07:49 AM

My opinion is that if you have to have a secondary suite in your house, you can't afford your house. Back east you are considered to be very poor to have a stranger living in your house!

Crack down on illegal suites and I would bet average real estate values would fall 30-40%.

There may be an element of truth in this. However property prices are
much cheaper overall.
Two exceptions: Toronto - where prices are high. And Montreal - which has a renting culture. Ownership is less coveted.

#50 sebberry

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Posted 17 April 2010 - 07:51 AM

When I lived in the house in GH with my grandmother the suite was rented every year to UVic students.

It was a clean, healthy reasonably modern suite only a 10 min walk from the university. Do you think the students care if the suite is "legal" or not? I've seen them live in far worse places simply because that's all there is.

If any crackdown should happen on illegal suites, it should be the ones that are in houses that are falling apart. I had one friend end up staying in a very dirty, moldy place with ceilings I would bang my head on.

An "illegal" suite is in no way by default unfit for occupation. Suites in owner-inhabited houses tend to be less of a problem to the neighborhood than when the whole house is rented out.

Back to our suite - since my grandmother was retired and only had her savings and pension, the income from the suite was really helpful. And this was back when the house was only worth $250,000.

I do know that the new owner made alterations to the suite to change it from two bedrooms + living room to 3 bedrooms with no living room, just a small spot in the kitchen to eat. I'm sure the income from it jumped 50% but I know the students really appreciated the space when we rented it out.

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#51 Layne French

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Posted 17 April 2010 - 05:09 PM

When I lived in the house in GH with my grandmother the suite was rented every year to UVic students.

It was a clean, healthy reasonably modern suite only a 10 min walk from the university. Do you think the students care if the suite is "legal" or not? I've seen them live in far worse places simply because that's all there is.

If any crackdown should happen on illegal suites, it should be the ones that are in houses that are falling apart. I had one friend end up staying in a very dirty, moldy place with ceilings I would bang my head on.

An "illegal" suite is in no way by default unfit for occupation. Suites in owner-inhabited houses tend to be less of a problem to the neighborhood than when the whole house is rented out.


I would argue that students do care about legal and illegal suites. In fact about a week ago some friends of mine and the SU external met with the city to discuss their new secondary suites bylaws. Since then they have formed a pilot project with the city around a different model for the university-banff trail area.

Recently we had two young adults die in the city, because their landlord put bars over the windows to try and hid the illegal suite. when a fire broke out you can guess what happened.

so yes we are very interested in creating legal suites that conform to code.

#52 LJ

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Posted 17 April 2010 - 07:07 PM

It depends entirely on the lender: there is no regulation or industry standard. Some will take 50% into consideration (well I guess that is the unofficial standard), but other lenders take more: all the way up to 100%.


There is going to be legislation very soon. Flaherty just announced a few days ago new rules for lenders in this very instance, as well as other restrictions requiring a larger down payment etc.

I saw this on CTV news a night or two ago, I tried to go find a link to the story and could only find something from Feb 16th. I suck at web searching.
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#53 Bernard

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Posted 17 April 2010 - 07:16 PM

Not every illegal suite is unhabitable, but a very high percentage of them do not provide housing that is up to reasonable standard.

It would interesting what would happen if a smart UVic law student launched a class action lawsuit against illegal suites and sued for the return of all the rent paid for accommodation that is not legal. How can you charge rent for something that you are not allowed to rent out? I think there would be a very interesting case to be argued.

While my scenario above sounds like a fun exercise, there is something to said about issues of liability of renting out an illegal suite. A smart insurance company would not pay out for a fire claim. A renter that was harmed in any way shape or form would have a good case to sue and odds are the house insurance would not cover it because the activity is not allowed.

Frankly a good lawsuit against some illegal suites would push the whole issue onto the front burner and make local government deal with it. In fact there might be some liability to local government for allowing the illegal suites, they are easy to find and local government is tacitly approving them.

Delta suffered very badly when sued over a leaky condo, they were found partially responsible because of the inspections were not done well enough. Since Saanich can be shown not trying to get rid of existing illegal suites, there is a strong case to be said for them being in part liablely responsible for sub standard suites.

When you rent you assume the landlord is renting you legal suite that is up to code. All the liability lies with the landlord and the local government for not ensuring the space is up to a reasonable standard. The rental is a fraudulent contract from the landlord side and this means they may actually be criminally liable for knowingly taking money for something they know they are not allowed to rent.

The only reason no one has sued yet is because the vast majority of the people living in illegal suites are happy to find anything to rent and they tend to be the poorest members of society.

#54 davek

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Posted 17 April 2010 - 09:57 PM

Not every illegal suite is unhabitable, but a very high percentage of them do not provide housing that is up to reasonable standard.


If the courts can say the city must allow people to tent in city parks, I don't think they can argue the city has a responsibility to evict people from illegal suites on the grounds they don't meet a "reasonable standard". Just about anything is better than a tent.

It would interesting what would happen if a smart UVic law student launched a class action lawsuit against illegal suites and sued for the return of all the rent paid for accommodation that is not legal. How can you charge rent for something that you are not allowed to rent out? I think there would be a very interesting case to be argued.


If successful, it would be devastating to the poor. Imagine a renter turning to the government agency that defends tenants, only to find out that they are not going to be protected because they are not entitled to legal protection for a space they are not allowed to rent. Worse still, they would have to be evicted immediately.

A smart insurance company would not pay out for a fire claim. A renter that was harmed in any way shape or form would have a good case to sue and odds are the house insurance would not cover it because the activity is not allowed.


I wonder. An insurance company that refuses a lot of claims stands to lose a lot of business, and since insurance companies have a pretty good handle on risk assessment, it appears they don't find illegal suites an issue.

Frankly a good lawsuit against some illegal suites would push the whole issue onto the front burner and make local government deal with it. In fact there might be some liability to local government for allowing the illegal suites, they are easy to find and local government is tacitly approving them... Since Saanich can be shown not trying to get rid of existing illegal suites, there is a strong case to be said for them being in part liablely responsible for sub standard suites.


There is little evidence I have seen to show municipalities feel they are at legal risk for tacit approval of illegal suites. Colwood council even issued a directive to bylaw enforcement several years ago to restrict enforcement against illegal suites to those that caused a substantial parking problem or noise nuisance. If there is a strong case to be made for municipal liability, it is taking an awfully long time to reveal itself.

When you rent you assume the landlord is renting you legal suite that is up to code.


Any one who does that is badly in error. The best you can hope for is that the suite is up to the code that existed at the time it was constructed, and codes change every 6 years or so. And even if it was compliant at the time of construction, there is nothing requiring it to be maintained in that condition. Worse still, code requirements for secondary suites added to existing homes are not nearly so stringent as they are for new construction. You might be amazed to see how much you can avoid doing simply by adding a smoke alarm

The only reason no one has sued yet is because the vast majority of the people living in illegal suites are happy to find anything to rent and they tend to be the poorest members of society.


I think the reason no one sues is because past suits have been largely unsuccessful, perhaps because the dangers of residential living in a single-family type dwelling are pretty small, and a secondary suite usually doesn't significantly increase that threat, or the threat of fire to adjacent properties. In fact, bylaws against suites probably have more to do with parking and protecting the character and property values of the community than they do with health and safety. I wonder if stratas have less trouble dealing with secondary suites? If so, there's another argument favoring private neighborhoods.

#55 Bob Fugger

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Posted 17 April 2010 - 10:22 PM

Frankly a good lawsuit against some illegal suites would push the whole issue onto the front burner and make local government deal with it. In fact there might be some liability to local government for allowing the illegal suites, they are easy to find and local government is tacitly approving them.


Well done for bringing this terrible blight on society, this evil scourge to light. Who's next on your $hit list: jaywalkers? People who park in front of your house?

Oh, hey, why don't you find a Uvic law student to file a class action against student loans? Same principle, they are afforded something they need and maybe it's not quite enough to live in the lap of luxury, so they sue so they don't have to pay it back (after having consumed the service, of course). Let the lad really feel good about why he's gone to law school.

#56 sebberry

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Posted 17 April 2010 - 11:13 PM

I agree with one of the posters above, I think all students in illegal suites should be forced out and moved into tent cities. After all, they're legal ;)

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#57 Bingo

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Posted 18 April 2010 - 07:22 AM

Be careful what you ask for. There may be a time in the not too distant future when you may have a need to live in your childrens basement, in an adequate but illegal suite.

#58 Bernard

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Posted 18 April 2010 - 09:20 AM

I think the lawsuit idea would be good because it would force local government to make secondary suites legal. Local government accepts a liability when it chooses not to take any consistent and clear action in relation to secondary suites. Their action is a tacit approval of the suites and the courts have ruled in numerous cases with respect to governments that choosing not apply a law on a consistent basis means you are liable for problems that come from that.

I know the code changes regularly, but many of the suites in this city would never passed the code when they were created in the first place. As an example, the minimum ceiling height has been around for a long time, a very, very long time. The bigger problem for most home owners is that built their suites without a permit and therefore if they do move to make them legal they have to meet the code of today, not the date when the work was done.

We are in this odd limbo in a place like Saanich. The council refuses to allow more density and refuses to allow secondary suites, meanwhile they turn a blind eye to the huge number of illegal suites. If they are not a problem, then why not simply allow them? If they are a problem, why not get rid of them? It is VERY easy to find all the illegal suites and get rid of them in a few months (OK with a huge number in Saanich it could take longer). As far as I know, the only local government in this region that enforces their rules on secondary suites is View Royal.

So what happens if I rent an illegal suite and then complain about the space not being habitable? Is the landlord not required to fix that problem? Who makes sure it gets fixed or makes sure that the tenant is not evicted and someone else allowed to move into the same space? The problem with illegal suites is that it is the tenant that suffers. We have no requirement for that tenant to be provided with similar size housing for the same price and have their moving costs paid if they can not continue living in the suite.

The legal limbo of these suites is a problem. At the moment almost all the problem is set on the poorest of our society that have to rent these suites but are denied any avenue from government to ensure their living space is up to a basic standard of livability.

People with well built suites should be allowed to make them legal and people with unacceptable ones should not be allowed to continue. No neighbourhoods should exist that do not allow them.

#59 Bingo

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Posted 18 April 2010 - 05:31 PM

Instead of lawsuits against the homeowner, why not lawsuits against the municipality for not providing an incentive for developers to build more rental apartments. That notion is almost as absurd. Most of the apartment blocks are aging to the point where they are in a worse condition than than some of the "illegal" suites. Any of the apartment blocks that were well constructed have been converted into condos.

Just as it has been buyer beware for the ongoing leaky condo fiasco, so show it be renter beware if you choose to live in a secondary suite. It is a simple matter to check the zoning to see if the suite you are preparing to rent is legal.

The lawsuit mentality seems to have become a right for many people today. They have developed a sense of entitlement, believing they have a right for others to take care of their needs rather than taking care of themselves.

The homeless community could fall into this category, a category that could grow in size should homeowners be forced to close down a secondary suite that provides an adequate and affordable home for for cash strapped students or others.

#60 concorde

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Posted 19 April 2010 - 07:49 PM

Concorde - love your posts as they are usually spot on, but to say that "back east you are considered poor to have a stranger living in your house"?

Where? Friends and family 'back east' either rent SMH suites to others, or happily live in them - from Winnipeg to Montreal. Never heard of any situation where either a renter or landlord was considered 'poor'. It is as large a part of the real estate culture, and economy, as here in Victoria.

Houses are being sold as having the advantage of a secondary suite, but show the data where a mortgage broker, or bank, is offering a loan based on that income. Not saying it does not happen in isolated cases - just not the norm.


I was visiting Quebec City and the people I spoke with on the block all felt that way. Some of the people were concerned if they needed a stranger living with them to pay their mortgage, could they afford the maintenance, additional cars in the driveway and on the street. One person indicated they were worried what it would do to property values.

While I think that some of their views were a little extreme, I have to agree with them that if they need strangers living in their house they can't afford to own a house. Its a big problem facing Victoria today and its why our real estate prices are out of control. The attitude that "well honey, we could buy this 600K house and our mortgage payments would only be $3000 a month for 30 years, but if we get a renter for the basement it will only cost us $2200" is out of control.

Everyone here realizes that if mortgage rates increase by 5% your mortgage payment will almost double? I can't wait to see the people who bought the 600K house try to make mortage payments of $6000/month. No wait, it will only be $5200/month with the renter!

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