Are Laneway Homes an Affordable Solution?
Updated: Jan 4, 2022
If you’re weighing out the pros and cons of buying a condo or building a laneway home, consider learning the benefits of building a laneway house. With the right planning and design, a laneway house is a smart investment that will provide an excellent return. Plus, building one might be more cost-effective than you think and unlike a condo, you won’t have to worry about strata fees.
By Design Construction are laneway house builders. Vancouver homeowners can learn the value of building a laneway house below:
There are many benefits to building a laneway house
Since the house is smaller and more manageable, it can be easier to move into for homeowners who want to rent out their main house – or for tenants if they’re renting out the laneway home. There’s less maintenance and costs, because of its size. It’s the perfect space to comfortably age in place or for a multigenerational family who wants to live together but still maintain privacy and independence.
Laneway houses are a great investment. On average, a single bedroom laneway house can be rented out for $1700 per month, while a two bedroom goes up to $2500 per month. You can use that money to pay off your mortgage or other living expenses, a
nd the dwelling will attract savvy investors when you sell. Even just owning a laneway house in New Westminster makes your property a top contender on the market. With laneway housing growing in demand and encouraged by the city, you won’t have trouble renting the space or selling your property in the future.
What should you consider?
When building a laneway home in Vancouver, there are a few things to also consider. The biggest is the cost involved, which can range from $200,000 to $300,000 or more. Luxury designs or custom, high-end materials can boost that cost much higher. The process of building a laneway house is also very involved and takes permits, regular inspections, a skilled and trusted company, and ensuring things are up to code. Added fees will also need to be calculated into a budget, like higher insurance, property taxes, and utility. There’s also the matter of eligibility, as not all properties qualify.
Lot sizes may vary, so it’s best to check with the city whether your lot qualifies. Otherwise, there are a few general qualification rules. For one, there must be an open lane behind the house or have access to an open lane. It must also have street access in the front and back. You can also only build up to 16% of your lot area, which will affect the size of the laneway house New Westminster. Whether you are renting or using it for family, that sizing factor will be important to consider.
It is an affordable housing solution
The bottom line is that laneway housing, despite the costs, can pay itself off. Even with the initial cost to build, a two-bedroom laneway house will earn you up to $30,000 in a year or more. Over time, that can easily build up and even help pay off your mortgage. Laneway housing is also the ideal place to start building major equity. There’s also no reason not to partner up with friends or family to build a laneway house together. You can share the cost, live together, or split any rental income to benefit as a whole. The main thing to remember is that a laneway house is easily a lifetime investment that will pay itself off in more than just one way.
Ready to benefit from a laneway house? Contact By Design Construction to learn more!