Legal Use, Additional Dwelling Units and Condominiums

A separate entrance, long rental history, listing description or seller statement is not enough on its own. Before paying a premium for multiple units or relying on rental income, investigate the property's legal and physical status.

• · Zoning permissions and permitted number of units
• · Building permits and final inspections
• · Fire separation and life-safety systems
• · Smoke and carbon-monoxide alarms
• · Ceiling heights and egress
• · Electrical and plumbing work
• · Heating, ventilation and utility arrangements
• · Parking and site requirements
• · Municipal records and work orders
• · Current leases and rent records
• · Insurance acceptance
• · Lender acceptance

The key distinction: a property may contain an existing apartment without the apartment being legally established, code-compliant, insurable or acceptable to your lender.

Additional dwelling units: opportunity requires feasibility

Guelph may permit additional dwelling units on qualifying residential properties, but the number and configuration depend on the specific lot, building, servicing and applicable regulations. Treat an additional unit as a development project, not as guaranteed future income.

• · How many units are currently legal, and how many may the property permit?
• · Can the existing building accommodate the design? Could a detached unit be possible?
• · Can required parking and access be provided?
• · Are water, sewer, electrical and HVAC systems adequate?
• · Are grading, trees or conservation constraints involved?
• · What permits, development charges and professional plans are required?
• · What is the realistic all-in construction cost, and how long will approvals take?
• · What rent is supportable after completion, and does the return justify the risk?

Condominiums as investments

A condominium — including the newer buildings along Gordon Street and in the downtown core — can reduce exterior maintenance responsibilities, but the corporation's finances, rules and management become part of your investment.

• · Monthly condominium fees and historical increases
• · Reserve-fund condition
• · Planned major work and special assessments
• · Rental and short-term-rental restrictions
• · Parking and locker ownership
• · Utility inclusions
• · Unit versus corporation maintenance responsibilities
• · Insurance deductibles and owner coverage
• · Litigation and management quality
• · Tenant demand and competing rental inventory

Use a lawyer to review the status certificate and related condominium documents within an appropriate condition wherever possible. Do not reduce the review to the current fee alone.