Are you feeling the urge for more housing space without investing in another property?
Canada’s housing shortage and the high cost of construction have resulted in many homeowners making use of existing property space to build from within, whether it’s an accessory dwelling unit (ADU) on a laneway or in the backyard, or a secondary suite renovation to expand an existing home.
Meridian is among the few financial institutions to have responded with flexible financing for these kinds of projects — but if you’re thinking about building additional housing on your property, where do you begin? What permits do you need? What financial assistance can you find?
In this post, we’ll provide some mission-critical answers, with the help of an in-house product specialist, Meridian’s Shamit Barmi, Product Manager for the Product and Payments Innovation team.
“As housing affordability continues to challenge communities across Ontario, secondary suites — like basement apartments, garden suites, and laneway homes — are becoming a popular solution,” said Barmi. “Yet, financing these projects can be complex and limited.”
Product Manager, Meridian Product and Payments Innovation team
First, let’s define and compare the secondary suite project types
- Laneway house – A small dwelling typically built adjacent to a public laneway as a rental property, for family use, or both, with the laneway providing independent access. Streamlined regulations in Toronto have made laneway houses permitted there since 2018.
- Garden suite – A self-contained accommodation usually located in the rear or side yard, but not on a public laneway, separate or detached from the primary dwelling, usually with independent access.
- Garage conversion – A complex process that will require municipal permits (e.g., building, electrical, and plumbing permits), and must comply with applicable building codes and regulations, such as structural integrity, fire safety, and energy efficiency.
Other types of secondary suites include private, self-contained renovated units with a kitchen, bathroom, and sleeping areas within detached, semi-detached, or row houses. These are often referred to as second or basement suites.
What are the potential benefits?
Secondary suites can bring a host of financial and lifestyle benefits, including:
- Increased living space, ideal for a home office or a guest house
- Multi-generational living that keeps family close while maintaining privacy
- Affordable housing that helps address housing shortages and rising rents — many municipalities now offer grants to cover a portion of upfront costs
- Additional income that helps with day-to-day living expenses or lets you save for a future experience, trip, or project
- Enhanced property value that results in a great long-term investment
What are the regulatory hurdles?
With secondary suite projects, each municipality will have its own rules and regulations. In Toronto, as many as 75% of homes that are adjacent to a laneway do qualify for a laneway house, according to LanewayHouseAdvisors.com.
Garden suites typically face different regulations. In early 2022, Toronto adopted a Garden Suites Official Plan Amendment and Zoning by-law Amendment setting out requirements for garden suites in most residential zones in the city.
Break ground with Meridian’s Secondary Suite Financing
As part of Meridian’s aim to help cultivate affordable housing and help our Members live their best lives, we’ve introduced a new and unique lending solution called Secondary Suite Financing.
“We designed Secondary Suite Financing to meet Canadians where they are,” said Barmi, “whether they’re building for family, future flexibility, or financial peace of mind. It’s about unlocking the full potential of your home.”
Key benefits of this offering include:
- Purpose-built for your needs — Whether it’s a basement apartment, a backyard garden suite, or a laneway home, this program can help bring your vision to life. It’s designed to unlock the potential of your property while meeting all applicable zoning and building code requirements.
- A solution that grows with you — Secondary suites aren’t just about adding space, they’re about creating possibilities. Whether you're planning for multi-generational living, future income, or simply want to stay in your current home longer, this solution is ideal for homeowners looking to make the most of their property without the cost and stress of moving. “You may not need to leave your neighbourhood to find more space,” Barmi says. “Meridian’s support helps you build it right where you already feel at home.”
- Supports affordability and sustainable living — Secondary Suite Financing is part of Meridian’s broader commitment to affordable housing and environmental sustainability. By encouraging the development of smaller, energy-efficient homes such as ADUs, we help to increase housing supply without new land developments.
- Helps address “The Missing Middle” — Multi-unit housing types (e.g., duplexes, triplexes, cottage courts, and multiplexes) that are scaled like single-family homes and located in walkable neighborhoods are referred to as “Missing Middle Housing.” Canada’s national housing strategy sets out that boosting development of this Missing Middle is one key to address our housing shortage.
Your next step starts here
Whether you're just starting to explore secondary suite options or you’re ready to take action, our Meridian experts are here to help.
- Explore the Secondary Suite Financing page on our website to learn more about the program, eligibility, and how to get started. View the page here.
- Visit a Meridian branch to speak with an advisor and receive personalized guidance
- Call our Contact Centre to ask questions and request a helpful checklist to guide your planning
No matter where you are on your journey, we’re here to help you move forward with clarity and confidence.
