Your real estate agent or lawyer must confirm with the City that a home for sale has a legally registered basement apartment or is legally non-conforming and complies with the Building and Fire Codes.
A code of conduct requires real estate agents to fully and fairly disclose all information about a property for sale. Typically, real estate agents use the caution "Vendor does not warrant retrofit status" when listing homes with doubtful legal status. Consumers should seek further legal advice before offering to buy these homes.
Risks of an illegal or unsafe basement apartment:
- Increased liability - You, as a homeowner, are responsible for meeting established standards for a second suite. If anything, such as a fire, happens, you would be liable, because you failed to meet requirements.
- Loss of insurance coverage - Building a rental unit in your home is a major change to your home. If you don't let your insurance provider know that you have changed how you are using your home, you could, in fact, make your coverage "null and void". (This means that you would no longer have any insurance coverage.)
- Limited damage recovery - An insurance policy does not cover the costs for rebuilding your home to meet current standards. Your insurance company is only required to cover the costs of restoring your home to the state that it was in when you bought your policy, before any damage.
- Prosecution -- If you do not meet City codes, you are breaking the law. You run the risk of being charged and can face fines of as much as $50,000 -- or even a year in prison - for each charge.
- Financing - Banks and other lenders don't generally consider income from an unauthorized basement apartment when you try to qualify for a mortgage loan.
- Tenants - You are a landlord. You must maintain your basement apartment in good operating order and you must follow all fire safety laws. Tenants may apply to reduce their rent if the unit fails to meet municipal health, safety, maintenance and property standards.
- Tenant insurance - Your homeowner's policy will not cover property that a tenant of an unauthorized apartment owns.
Can I legally convert vacant space in my home into a basement apartment?
No. The City's zoning bylaw does not permit new basement apartments. If you did not have a basement apartment in your home before November 16, 1995, you cannot add one. A home built after 1995 can never have a legal basement apartment.
You have to ask the City to change the zoning bylaw before it can permit a new basement apartment. Asking the City to change the zoning bylaw requires you to submit a zoning bylaw amendment application and a fee of $7,759 to the City's Planning, Design and Development Department. The staff of the department will process your application and recommend whether City Council should approve your application to change the zoning bylaw.
Article compliments of the City of Brampton
All the best, MyDaddyHomes
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