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Dec. 23, 2014 | CREBNow

2014: The year in secondary suites

Low vacancy rates, high absorption rates in the resale condo sectors and dwindling supply in the single-family market vaulted secondary suites into the spotlight in 2014.

The issue culminated in mid-December with an 8-7 vote by city council against approval reforms – which prompted Mayor Naheed Nenshi to declare he'd leave the room during future secondary suites debates until it came time to vote. Ward 7 Coun. Druh Farrell likened the entire process to "giving birth to a chair."

The latest framework would have established a discretionary development permit process for suites where they were currently not allowed, as well as furthered public consultation with Calgarians to fully develop regulations moving forward. If it had been endorsed, the framework looked to protect the safety of tenants, ensure neighbourhood consultation was part of the development review, increase diversity of housing choices, establish requirements for secondary and laneway suites and provide a consistent approach to regulation.

"The Chamber is highly disappointed that city council failed to move secondary suites forward [Dec. 15]," Calgary Chamber of Commerce president and CEO Adam Legge said following the mid-December vote.

"Eight members of city council blew an important opportunity to make Calgary a better place to live, work and grow a business. Several council members displayed an utter lack of concern for the issues businesses face in our city."

Legge was among a number of prominent business owners, MLAs and industry advocates who voiced their support of suites throughout the year. In early December, politicians such as Alberta Party leader Greg Clark and Liberal MLA Kent Hehr started throwing their hats in the ring in support of suites including.

Shortly after, Calgary businesses such as WestJet, Fiasco Gelato and First Calgary Financial added their voices to the chorus stressing the importance of affordable living for attracting and retaining new talent to Calgary.

"It doesn't happen all the time, but we do have occasions where we offer a candidate a job and they feel they cannot accept the offer because they are very unsure they'd be able to afford to live in Calgary, where often the vacancy rate is very low and the price of rent is extremely high," said Geoff Mullback, director of talent and organizational development at WestJet.

Calgary's vacancy rate was among the country`s lowest in 2014, hovering around one per cent for most of the year before improving slightly to 1.4 per cent late in the year.

As such, many would-be renters turned their attention to the housing market, where they met equally tough conditions. Listings in both the condo and single-family markets did not surpass sales until later in the year, creating unusually tight market conditions for buyers, noted CREB®.

Those conditions, in turn, had an upward effect on prices, with double-digit gains for both sectors for most of the year before levelling off in the late fall. For many shelter-starved Calgarians, secondary suites offered a chance of affordable homeownership, noted critics.

"It's been essential for a long time, but there's no question that we're in a housing crisis at the moment, particularly as it pertains to affordable and entry-level housing," said Nenshi.

"And secondary suites are a market solution for that, not a government-driven solution. That's one of the reasons they're so important."

City council's handling of the contentious secondary suites debate was highlighted within a yearly performance report released by the Manning Centre, which broke down the time spent by council debating suites throughout the year.

On June 9, suites encompassed 33 per cent of the total meeting; on July 21 it was more than five per cent, Sept. 8 saw 27.2 per cent, Oct. 6 say almost half of the meeting at 46.7 per cent, Nov. 3 dropped to 9.2 per cent and the latest vote Dec. 8, took up 20 per cent of the meeting.

"Council regularly spends a lot of time discussing minor issues – such as the rezoning of individual houses – that perhaps should not require their attention at all," said the report. "This type of low level discussion is a carry-over from when Calgary was a much smaller city, and council should develop more efficient practices for dealing with these types of issues."

More than 53 per cent of homes in Calgary are currently zoned RC1 or R1, prohibiting secondary suites.
The City was on pace to approve 150 suites in 2014 compared to 178 created, and 62 in development, between 2009 and 2012, when Calgary had a secondary suite grant program. In comparison, Edmonton approved 1,396 suites between 2010 and 2013 under as Cornerstones program.

Tagged: Calgary | Calgary Real Estate News | Secondary Suites | year in review

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