The Ultimate Calgary Basement Suite Guide: Legalize and Profit in 2024!

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Welcome to the ultimate guide on how to transform your basement into a lucrative legal rental suite in Calgary! In this detailed walkthrough, we're diving into everything you need to know to maximize your real estate returns in 2024. Whether you're looking to pay down your mortgage faster or you're an investor aiming for a significant boost in your income portfolio, you've landed in the perfect spot.
In this video, we take you on an exclusive tour of a stunning legal basement suite located in the desirable community of Arbour Lake, showcasing the potential of what your basement can become. We cover the three types of legal suites in Calgary, catering to properties built before and after March 2018, as well as detached secondary suites, offering insights into each option's unique benefits.
The legalization process can seem daunting, but we break down every step from the initial paperwork to securing the necessary permits, ensuring you understand how to navigate these procedures smoothly. A critical aspect of this journey is understanding the financial commitment required to create a legal suite and how it can generate significant rental income. To help with this, we dive into the costs involved in building a legal basement suite and discuss the potential returns on your investment.
The Calgary Suite Registry and the Secondary Suite Incentive Program are essential tools for any homeowner looking to legalize their basement suite. We explain how these resources can give you a competitive edge in the rental market and detail the incentives available to Calgary homeowners.
Featuring insights from Alan Ng and Zach Schultz of our Live Inner City Real Estate team, and Sean from Elodie's Contract and Services, this video offers a real-life look at the transformation process, highlighting the challenges and solutions encountered along the way. From understanding the critical safety and legal requirements, such as egress windows and smoke alarms, to a behind-the-scenes look at the construction hurdles, we've got you covered.
👉 Whether you're a homeowner or an investor in Calgary, legalizing a basement suite could be the game-changer you're looking for in 2024. Join us as we explore this promising opportunity to enhance your property's value and secure a steady stream of rental income.
Don't forget to like, subscribe, and hit the bell icon for more insightful real estate content. Drop your questions and experiences in the comments below - we love hearing from you!
00:00 - Intro
00:51 - 3 Types of Legal Basement Suite in Calgary
02:18 - The Calgary Suite Registry
02:45 - Secondary Suite Incentive Program in Calgary
03:10 - Legal Basement Tour with Alan and Zach
04:14 - Ceiling & door Heights Requirements - Secondary Suite Calgary
04:42 - Bedroom egress windows Requirements - Secondary Suite in Calgary
05:30 - Plumbing Requirements - Secondary Suite Calgary
07:05 - Electrical Requirements - Secondary Suite Calgary
07:55 - Legal Basement Suite Second Bedroom
08:34 - Legal Basement Suite Third Bedroom
09:05 - How Long Does it Take to Finish a Legal Basement Suite?
09:36 - How Much Does it Cost to Build a Legal Basement Suite in Calgary?
10:30 - How Much is the Rent for this Type of Basement Suite in Calgary?
10:57 - Unexpected Issues and Biggest Challenges upon doing a Legal Basement Project
12:00 - Can you Renovate the Basement while Someone is Living Upstairs?
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Felix Chan & Jasben Lai are Calgary Realtors with the LiveInnerCity Real Estate Team in Alberta, Canada. Felix is also a Calgary Mortgage Broker and Real Estate Investor.
As your Calgary Real Estate Agents of choice, we are your one-stop-shop for all your Calgary Real Estate needs. We provide our best tips and tricks for home buyers, sellers, and investors looking in the Calgary Real Estate Market. We also dive into Calgary Communities and Home & Condo Tours.
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Опубликовано:

28 июн 2024

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Комментарии : 21

@alanng586 3 месяца назад

Hey Shaun, thanks so much for the opportunity to show case your legal basement project, much appreciated!!

@mohaargurpreet 3 месяца назад

Great Video. What about parking space for tenant though? Would street parking count or driveway in front of house?

@ElodiesContractingServices 3 месяца назад

Driveway parking slot counts as parking for the City request.

@LiveInnerCity 3 месяца назад

Hi @mohaargurpreet! Yes, street parking or in this case the owner gave part of the driveway for them to park outside.

@Raza__12 Месяц назад

@@LiveInnerCityYou can’t count on street parking. You must provide tenants a parking spot on the property.

@Itiswhatitispartna Месяц назад

@@Raza__12false, street parking is permitted as per the City of Calgary website. Don't misinform people.

@Raza__12 Месяц назад

@@Itiswhatitispartna Prove it. Don’t fk around.

@yb9355 3 месяца назад

Hi there, what are the tax complications for those who convert their primary residence's basement into a rental property? I am concerned that the property will not be eligible for the capital gain tax exemption. Could you shed some light on this matter. Predicting your suggestion "check with your accountant" should say I did and didn't get a clear answer. Looking for real-life experience

@StevoSun 2 месяца назад

CRA is intentionally vague here, the rule is as long as it's a secondary use of the property you will not lose your primary residence exemption. So things like the suite size is less than 50% of the total property, no cca deduction, no structural changes, etc. However the CRA applies these rules on a case by case basis.

@yb9355 2 месяца назад

@@StevoSun thank you!

@LiveInnerCity 2 месяца назад

That is a great question so I took the initiative to ask my accountant directly. Although I can't speak on behalf of what our clients have done nor do we have personal experience with this, here is their answer. I hope this helps: Here's a simplified explanation of what your accountant described about converting your basement into a rental unit and its tax implications: Small Rental Use: If the rental area in your basement is less than 25% of your home, you haven't made major structural changes, and you don't claim depreciation (Capital Cost Allowance) on it, then your home can still be considered your principal residence for tax purposes. This means you don’t need to do anything special when it comes to taxes. Larger Rental Use or Structural Changes: If the rental area is larger, you’ve made structural changes, or you claim depreciation, then for tax purposes, it's like you've sold that part of your house (even though you haven't actually sold it). This is called a "deemed disposition". You need to calculate how much that part of the house has increased in value since you started renting it out and potentially pay taxes on that increase. Filing Taxes: When you do this, you'll need to fill out "Schedule 3" and "Form 2091" in your tax return. Later, when you actually sell your house, you’ll split the selling price between the residential part and the rental part. You’ll need to report any profit (capital gain) from the rental part. Converting an Illegal Suite to Legal: If your basement suite wasn’t originally set up legally, you’ll need to get it inspected and apply for a building permit. The City of Calgary requires certain safety features like proper exits, smoke alarms, and separate heating systems. Once it’s legal, similar tax rules apply as above. Selling the Property: When selling, you may need to pay capital gains tax on the increase in value due to the basement suite being legal and potentially desirable. An appraiser can help determine how much more your house is worth with the legal suite compared to similar houses without one. Illegal or Non-Compliant Rentals: If your basement suite doesn’t meet city codes or is used for short-term rentals like Airbnb, you can’t deduct expenses like you can with a long-term rental. You’d have to pay taxes on the total income you earn from these short-term rentals.

@yb9355 2 месяца назад

@LiveInnerCity thanks for the detailed response. Appreciate the time you took to deep dive into this topic. Now I am thinking about turning my basement into a rental unit as the payback period is gonna be less than 2 years, and after that, the unit will be covering at least 40% of my mortgage and utilities. Looks like a good investment

@LiveInnerCity 2 месяца назад

@@yb9355 awesome! Renting out a basement unit can be a great way to offset costs. I also created a video about real estate investing you might find insightful: ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-gxixBMG46lo.html&pp=ygUrcmVhbCBlc3RhdGUgaW52ZXN0aW5nIGluIDIwMjQgbGl2ZWlubmVyY2l0eQ%3D%3D

@ryanb.6454 2 месяца назад

Average cost of backyard suite?

@LiveInnerCity 2 месяца назад

Depends on size but I would expect it to be around 300k. Do you want to get in touch with our contacts to see what building one would look like? Please email hello@liveinnercity.com and include your full name and number

@kaoriyoshida3061 2 месяца назад

May I have the builder contract contact ? Thank you in advance.

@LiveInnerCity 2 месяца назад

Hi Kaori! You can message them on their IG @elodiescontracting :)

@ElodiesContractingServices 3 месяца назад

It was awesome having your team come to our job site to show off the new space!

@LiveInnerCity 3 месяца назад

Thank you! We're always excited to collaborate on great projects.🙌

@ryanb.6454 2 месяца назад

Average cost of backyard suite?

@LiveInnerCity 2 месяца назад

@@ryanb.6454 Depends on size but I would expect it to be around 300k. Do you want to get in touch with our contacts to see what building one would look like? Please email hello@liveinnercity.com and include your full name and number