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Costs piling up for laneway houses in Vancouver

Having a little cottage behind her home has always been a dream for Ocea Ringrose. “Growing up as a kid…

By Stephanie Hallett , in City , on April 8, 2010 Tags: , , ,

Having a little cottage behind her home has always been a dream for Ocea Ringrose.

“Growing up as a kid I always loved the idea of having a little coach house or a little studio house,” Ringrose said. “It’s just so cool.”

In one year, Ringrose will have that cottage.

She and her partner, Colin Meacham, are tearing down their home, built in 1927, and rebuilding it along with a laneway house, an option they wouldn’t have had a year ago.

The  last July to allow laneway housing in areas currently zoned for.

“Being at Trout Lake, we’re on a peat bog here. So everything’s sinking,” Ringrose said. “We waited long enough for the city to implement laneway housing so we feel really lucky that now we have an opportunity to do something special.”

Photo gallery:

Ronda Howard, a senior city planner, said Vancouverites expressed interest in housing aging parents near caregivers, and providing starter homes for adult children in their own communities.

But building and development permits, , construction fees and landscaping fees make laneway housing expensive.

This laneway house at McGill and Slocan in East Vancouver is nearly complete.

“It’s not really what I would call affordable,” Ringrose said.

The city estimated would total around $150,000. But Michael Geller, a Vancouver architect, planner and developer, said the actual costs are closer to $250,000.

One builder said his laneway houses cost between $230,000 and $300,000.

“If you think of what you get for that price it’s quite remarkable,” said Jake Fry, who owns Smallworks, a company that builds prefabricated laneway homes. “If you think of something akin to a one-bedroom apartment or a condominium … you’re really not getting into much under $450,000 or $500,000.”


A housing package

But unlike a condo, a laneway house can’t be sold on its own. It can only be sold with the whole property, including the main house.

Jason Yuen, a Vancouver contractor, said many homeowners are looking to add laneway homes while rebuilding their main houses to reduce costs and disruptions.

But homeowners have to pay for separate building and development permits on each new building, meaning their to the city can be up to $2,500 for both structures.

Yuen said this adds unnecessary costs and obstacles for homeowners.

“It doesn’t make sense that they’re double dipping,” he said.

The city’s Ronda Howard said separate permits are required for each building so that one house can be inspected and approved before construction on the second house begins.

“As often happens, people would like to start living in one while working on the other,” she said.

33 permits

The city has also touted laneway housing as a way to .

Ringrose and Meacham had to remove one tree from their backyard for their laneway house. They say they'll be planting at least three new trees to replace this one.

Ringrose and Meacham said their laneway house would have to be rented out to recoup the high costs of building.

“It will help us bring in a bit of income after the big expenditure. And hopefully someday, if we can afford it, have it as our own,” Ringrose said.

But Geller said laneway housing is not a viable way to increase rental-housing stock.

“I just don’t think, at least in the short term, enough people are going to go ahead,” the architect said.

Since the bylaw passed in July 33 permits have been approved, according to the city’s March report. About 34 more applications await approval.

“That’s really not a lot,” Geller said. “There was at one time speculation that the first hundred units would be taken up very, very quickly and people would be crying to allow a lot more to be built.”

But Howard said this type of .

“It will really help when people see built precedents,” she said.


  • I’ve been dying to know how much laneway houses would really cost. and you beat the local papers too it. The $150k estimate seemed had always seemed too good to be true.

    However, I do agree with Fry. $250k is a pretty good deal.

    True, you can’t build equity in it like a condo, but that’s not the point. The whole idea is to have granny move out there so she can afford to stay in the community or rent it out to students as a mortgage helper, making things more affordable for everyone.

    Laneway houses will not solve Vancouver’s affordable housing crisis, but they are making our city a little more liveable, so all the power too them.

  • We have four laneway homes under construction in Vancouver – 2 on the west side being built in conjuction with new single family homes and 2 on the east side where the existing homes remain. The factors that raise costs substantially are most related to utility costs and design. Trenching gas lines, electrical services, sanitary and storm lines, along with water services is quite costly to do; depending on the location of these services in relation to the site. A well planned and though out design can also alleviate substantial cost as well as making an attractive laneway home. Also, contacting a BC Hydro designer in the initial stages of the project can save a great deal of time; provided you can contact them and get a straight answer upfront.

  • Smallworks builds beautiful and well appointed laneway homes in Vancouver for between $230-290K all in. If you have the land, there’s no better way to keep family close, build equity and save money. At, say, $250K your mortgage would be about $1170 p/mo to borrow the whole thing on a 5 yr term. Vancity’s early research indicates that value is increased by this addition in excess of the cost (eg: $1m property, now worth $1.25m+), so there’s the equity, and that increased equity value rises with the market over time (a bonus $25K when the market rises 10%). When you sell it later (with the house), unlike an alternative investment property, it’s capital gains tax free as part of your principal residence! Alternatively, rent it out for $1800 p/mo and you’re into great positive cash flow. Unheard of in Vancouver these days. What better little detached house could you buy in Vancouver for $250K ($1170 p/mo)?? [email protected]

  • I love how all this gets spun as making things ‘more affordable’. Do you really think, as Michael Lyons above points out, that once a land owner has sunk an additional 230k-290k into a property that it makes the property more affordable to buy? It makes a prospective buyer have to borrow more from the bank and service a larger debt. So only people with even higher incomes can actually own their property.

  • Lane housing is only step 1. It allows the first step in eliminating all single family residential zoning.
    Yes, you presently cannot sell your laneway home separately, so the actual affordability of a property in Vancouver goes UP since it costs 250,000 to add the lane home and who would not want compensated for that either in rent or price. So step 2 is obvious. They will make it possible to sell the property in pieces. Main house and laneway house in a strata arrangement. This is the developers dream.
    And of course, in the long run, it wont help as long as we are continually allowing for growth.

    This is so sneaky and destructive of what Vancouver means to people who bought here. Notice also, that this kind of densification is particularly favoured by the eco socialists because it targets the automobile. You gotta ditch your garage so your car parks out in the street causing manufactured ‘congestion’ which no doubt can only be remedied with more bike lanes which cause more ‘congestion’ … and so on.

    The real question, of course, is completely avoided. WHY grow any more? When does growth stop?
    Canada is basically empty of people.. there is plenty of room and yet these social engineers want to densify the most livable city in Canada until it is a conglomeration of rabbit warrens. I am disgusted.

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