Suite Showcase – Second Suite

Suite Showcase: Ranchlands Calgary

Introduction

Welcome to our second Suite Showcase! In these posts, we connect with a homeowner to learn about how they added a legal secondary suite to their house and share the finished product.

This week we connected with Chris Hughes to talk about the first home that he and his wife Michelle purchased in 2012. Chris is an airline pilot and at the age of 30, he and Michelle purchased their first home with the intention of adding a legal suite to the property. Chris had been interested in investing in rental properties for a few years before he purchased their first home, and spent a few hours each week reading about property investments, and looking for homes on MLS. After about a month and a half of searching with a realtor, they were able to find their first house in Ranchlands.

The house is a 4 level split home. Chris and his wife Michelle lived on the top 2 floors of the home, and renovated the 3rd floor as the basement suite, and the 4th floor as the mechanical room and common space/shared laundry.

When they purchased the home, an illegal suite had already been started on the property (the plumbing was already completed), and Chris realized that it would not take much work to bring the suite up to code. “It’s not worth the risk to own an illegal suite. If there is a fire, you could get sued, and your life is ruined. It’s not worth a couple of bucks of rent,” said Chris. He added, “Having an illegal suite gives your tenants leverage through the fear of having them report you if they don’t get their way, and I wanted to sleep soundly at night.”

Chris had a small amount of construction experience, and decided that he would try his hand at framing, drywalling, and painting, and ended up only needing to hire an electrician and HVAC expert to support him on the project. When Chris finished a day of flying, he and his wife would work on the basement. It took 4 months of hard work, but Chris was able to finish the suite, get a final inspection approved by the city, and a renter in his basement.

The experience was so positive for them that within 18 months Chris and his wife had purchased a second home in the SE of Calgary where they also renovated the basement to add a legal suite. When I asked Chris how he could afford to do this he told me that they refinanced their first home and put 5% down, which freed up the funds to invest in a second property and renovations.

Q&A

We asked Chris a few questions about the overall suiting process:

Q: Was your plan to always suite your home?

A: My wife and I had lived in basement suites and upstairs suites before we bought our first home. I had been interested in investment properties for a while, and knew that I wanted to own a home that could provide income. My wife is a teacher and has a pension plan, but as a pilot, if I get injured and can’t fly anymore then my pension could be gone. I wanted to have a property that would be an investment for my retirement.

I spent a lot of time researching and learning about investment properties before we jumped into buying our house. My wife and I wanted to make sure that our home could be an investment for us.

Q: Were there any challenges that you were not expecting to come across when suiting your house?

A: Some of the building code requirements at the time were an extra challenge. A lot of these have become simpler recently, but there is still some confusion on a few of them. For example, the code says that there needs to be “adequate ventilation”, but what does that even mean? There were a lot of windows in the home, so I thought that maybe that would be enough, but it turns out you either need to have a separate furnace that can blow the air or if you installed baseboard heaters like me, a HRVsystem to move the air around. The only way that you could get an actual answer was by talking to an inspector directly, or calling 311.

Q: Was there anything that was simpler than you expected?

A: The whole process was simpler than I imagined it would be. Looking at the itty bitty details can seem daunting, but when I look at the big picture everything went well.

Q: Is there anything you wish that you had done differently?

A: Ultimately, time is money. I spent a lot of time working on this project and my wife did not get to see me that much while I was working downstairs. I might have hired more of it out to get the rental finished faster.

I would have liked to have lived in the basement instead of upstairs so that we could have gotten more rent.

Sound is the number one complaint that I hear about when renting a suite, and although I added soundproofing insulation and drywall, I wish that I also added resilient channels to bring the noise down even further.

Q: Would you recommend other people suite their homes?

A: Absolutely. With a few caveats however. You need to do your research first. You shouldn’t just watch a TV show or two and think that you can jump in. Spend time looking online, and take your time finding the right home. There is nothing worse than buying a home that you find out later you can not suite.

If you do not need all the space of a full house, then it is really silly not to do it. Especially when you crunch the numbers. I am breaking even on my property in Cranston, and am cash flow positive with my Ranchlands house. These homes have been a great investment.

Q: Do you have any advice that you want to give people who are interested in suiting their homes?

A: Start slow. Do your research. Head to the City of Calgarysite and read about the steps. The site does an amazing job spelling out the steps that you need to take. If you are unsure what to do next then pick up the phone and give the city a call. See if other landlords are willing to chat with you about the process. I find that most people are more than happy to share their knowledge.

A lot of people think that being a landlord can be scary. Don’t forget that you can always hire property management companies to run the suite for you, even if you live upstairs!

A cozy fireplace to stay warm during the winter months.

In Conclusion

Chris and his wife are true believers in the value of legal secondary suites. They are using their properties as long term investments, and through effective spending, were even able to purchase another home with a suite with it within 18 months. We hope that Chris’s story and experiences inspire you to follow down this path as well.

Please feel free to share your stories below, and if you have a suite that you would like showcased click the link here! We can’t wait to see what you have done!

Suite Showcase: Silverado – A Cautionary Tale of Illegal Suites

Introduction

Braydon Randall is a young entrepreneur and investor who had been interested in investing in real estate at a young age. He was born and raised in Vancouver, and began to work in trades as a crane operator. He was working up in Fort MacMurray where he learnt from friends that Calgary was (and still is) a great city for investment properties. Braydon found that investing in Calgary homes was a lot less expensive than it was to purchase a house in his hometown of Vancouver.

In 2014, at the young age of 23 Braydon bought his first house in the SE of Calgary with the intention of adding a secondary suite to the home. The house is a 4 level split, which he found to be very simple to separate and suite. Working in the trades, Braydon had many friends with a wealth of experience which he was able to get their assistance on suiting his home.

Although Braydon worked hard to make sure his suite was well built, he took the advice from his father and decided to not go through the process of making the suite legal. This proved to be a costly mistake for Braydon as his next door neighbour invited Braydon over for a beer right as he was finishing his project and informed him that his wife and he did not feel comfortable having a renter for a neighbour.

They ended up reporting Braydon. He had to tell the renters that he had been in the house for less than a month that they would not longer be able to rent from him, and then had to go through the process of getting the city to inspect and approve all the work that was done (which is challenging and expensive once all the drywall is up). In the end, Braydon was able to get the suite up to Calgary and Alberta building codes, and now has easily one of the most beautiful legal secondary suites in the city.

Let this be a cautionary tale for all of you. When suiting your home, take the time to do it legally!

Q&A

Q: Was there anything in the process of suiting your home that was simpler than you thought it would be?

A: Nothing really comes to mind. For me the process was not an easy one as I had not originally gone down the legal route. I was really happy that I took a lot of pictures and documented the work that I was doing before hand, because I was able to use that to show the quality of the work to the city and the electrical and plumbing inspectors.

Q: What happened when you were reported for having an illegal suite?

A: A month after I met with my neighbour I got a letter in the mail saying that there is a complaint and that they are coming to do an inspection on an illegal suite. At that time I had some tenants who had been in there for about a month. They were older, in their late 60s. So I had to kick them out. I had to remove the stove, I had to remove the dryer, and that is when the process started of having to get the building permits and developer permits.

Honestly, it feels like I pretty much got black listed from the city. The contractor that I ended up getting to help me after the fact, he has been doing secondary suites for like 20 years. He said that he had never seen the city make someone jump through so many hoops. It really felt like the city was doing this just to screw with us.

Q: Do you think the city made it so challenging for you because you had originally gone down the path of doing an illegal suite?

A: 100 percent. I believe that it was because I did it illegally, and then tried to get it done legally after the fact. I have gone to investment seminars and have talked to many people, and no one has had to deal the problems that I have.

As an aside: If what Braydon is saying about the city is true, this feels like a terrible way to treat someone who is trying to turn their suite legal. The Calgary is need of more affordable housing, and they want basement suites to become legal. Making the process difficult because someone originally went down the wrong path does not feel like the appropriate way to handle the problem.

Q: If you were to do it again would you start the process of going legal in the beginning?

A: Yes. I should not have done the illegal route. Deep down I wanted to do it legally, and I had a couple people, including my own father who influenced me in making the wrong decision. Making the suite illegal and then getting caught probably ended up costing me at least an extra fifteen thousand dollars that I did not need to spend.

Q: How much did it cost you to suite your basement?

A: In the end it costed me about eighty thousand dollars. Fifteen thousand of which I probably did not need to actually spend.

Q: How much money did you put towards the down payment of your home?

A: I was living in the house, and I decided to put five percent down when I bought the home. I wanted to put the least amount of money down on the home so that I could use that money instead to renovate and put renters in so that they can pay the mortgage instead.

Q: Is your rental property profitable?

A: Yes. I get the mortgage entirely paid off, I live in Vancouver now, so ten percent goes to the property manager, and I am ending up a few hundred dollars in the green every month even after that.

Q: Are you looking to buy and suite another home in the future?

A: Yeah, I would definitely do it again. I am actually looking to buy the house two doors down when it becomes available. It is also a 4 level split. It is the only other one in the whole neighbourhood.

Conclusion

Braydon, was able to persevere through the challenges of turning his illegal suite into a legal one, and ended up all the better for it. He was able to build easily one of the most beautiful legal suites in the city, and is cash flow positive from it.

Suite Showcase: Tour Our First Suite

We built our first basement suite the fall of 2014, and moved in just before Christmas. I like to think of it as “my dream basement suite” and we lived there happily for two years. Let me show you around!

Before you even step foot into the suite, there is a large patio that offers great outdoor living space for the downstairs tenants. And look at that huge window! No, it does not feel like living in a basement.

Yes, this space is small! You can see pretty much all of it when you stand at the front door. All done, it’s around 620 sq. ft. and we planned and designed every inch of space to be as effective as possible. Although it’s “cozy,” it’s comfortable and still feels spacious.

There is a small closet next to the entry which offers enough storage for coats and shoes. That’s something I love about this place, there is a surprising amount of storage.

Kitchen

Aaaah, the kitchen. Look at all that cupboard space! And cabinets that go up to the ceiling – luxury. Seriously, this is an amazing kitchen. We chose materials that were timeless and simple as well as affordable and durable.

We chose a counter depth refrigerator since the kitchen is quite narrow. A regular fridge would have stuck out an extra 6-8 inches beyond the 24″ deep bottom cabinets and we just couldn’t afford to lose the floor space. Not to mention it would have made opening the oven door really squishy.

Notice all the drawers! There are two banks of three 24″ wide drawers which is really dreamy. You don’t know how horrible storing pots and pans in a cupboard is until you have POTS AND PAN DRAWERS. I don’t know how anyone lives without them. We were able to squeeze quite a bit of counter space out of this kitchen and even a little spot for a stool at the end of the counter on the left side. Perfect for a quick breakfast, making a grocery list, or sitting and chatting with whoever is making dinner.

There is a tall narrow bank of cupboards on the other side of the fridge that offers additional storage. It’s as deep as the cupboard over the fridge and perfect for a food pantry.

Heres the view from the back of the kitchen looking towards the door (in the bathroom doorways). We chose a door that had a big window in it to allow even more light into the space. I think that is really the key to any basement suite feeling like more than just a basement – natural light! Wherever possible, add a window, or a bigger window to let in more light.

For privacy we made sure the door’s window had an adjustable blind between the panes like this. A window with frosted glass also would have worked.

You can also see how much furniture we were able to fit into the space and it still feel usable and not too cluttered.

Bathroom

The bathroom. Again, lots of storage and utility crammed into a tiny footprint. The large mirror over the vanity helps open up the room and all the white keeps it so clean and airy. We also put lights over the vanity as well as in the ceiling to add as much light as possible.

Because there is very little wall space, we put towel bars on both of the doors (one leads into the common space/utility room). It was fun being creative with how to include some of necessary elements into the room when we didn’t have regular space to work with. The shelving we had built for behind the door acted as a linen closet and held towels, toilet paper, and every other bathroom item you can imagine that didn’t fit in the vanity storage.

Bedroom

Our bedroom was small and simple but the 9′ ceiling, big window, and white paint made it feel bigger than it was. We were still able to fit night tables, and a small IKEA shoe cabinet at the end of our bed. We also chose a bed that has huge drawers in it to house all the extras. I don’t know if you can tell, but I like organizational

There is a small walk in closet with custom shelving that was built under the stairs leading to the upper suite. What did I say about being clever about using EVERY INCH we had? You’ll also notice a slightly haphazard chest of drawers peeking out on the left side of this photo. Although not perfect, it was another space saving idea we had. We cut a hole in the wall that led to the empty space beneath the stairs and shoved the dresser in there. It can be moved out of the way to access additional storage space for things like boxes and Christmas decorations.

Living Room

Here is a great shot of that big window and the 9′ ceilings in the main living space. The ledge along the far wall is from the concrete foundation and, instead of boxing it in and making the wall flat, we left it open to create the sense of more space. The ledges also add some interest and depth to an otherwise white box.

Here’s another view looking straight at the wall with the ledge. Although you can see that one thin wire hanging down from the TV, you’ll notice how most are hidden away. We used some PVC tubing in the framing behind the drywall to hide the cables from the TV to the game systems and other electronics that are stored on the shelving below. We had planned to place the TV above the ledge and didn’t want the mess of cables to deal with.

Across from the living room was open space that we weren’t sure how to use. When planning how wanted to use the suite, we were pretty conscious of all the stuff we already owned and what we wanted to keep out instead of put in storage. Our book collection needed a home, so we made “library” that also served as a desk and office area. The ledge fit in perfectly and added more shelving. The books also add so much colour and livens up the otherwise simple white space. It’s one of my favourite elements in the whole suite.

Well, there it is! There are millions of other little details I could go into about what elements we chose and why, but at least this gives you a peek into our first big project and gives you a sense of all you can do in a basement suite, even when there isn’t a lot of space to work with.

If you have any questions or would like to find out more about anything we shared with you in this post, don’t hesitate to get in touch!

I’ve included a simple floorplan of the space for you to reference.