Non legal suites and the BC Rental Tenancy Act?

[darkness05]

Hey everyone. I am currently considering purchasing a duplex that has a non conforming suite in the lower level. I am a little concerned because of the chance of the suite getting shut down which would then throw the numbers all off. I was speaking with my RE agent and they were under the impression that if the suite got "popped" and there was a current lease with a tenant, the lease would supersede the city and the tenant could not be evicted until the term of the lease ended.

Any ideas?

Thanks!

 

[Thomas Beyer]

Some cities are very diligent in enforcement and many are not, i.e. only after three written complaints for example.

Where in BC ?

 

[darkness05]

Ok good to know ... Kelowna

 

[Tina Myrvang]

Hello Darkness,
Below is the link to the City of Kelowna and information on suites.

Secondary Suite

A secondary suite is a self-contained residence, located within a single family house, that has its own entrance, kitchen, bathroom and living area.

A building permit and a business licence are required to ensure the secondary suite is legal. The business licence must be renewed every year.

http://www.kelowna.ca/cm/page313.aspx

 

[darkness05]

Thanks for the link Tina. I have been on the COK site before so I am familiar with the info that was in that link.

What I am asking specifically is if the city finds out about a non-legal secondary suite, and there is a tenant in the unit with a lease ... what happens to the tenant? Are they booted out on their butt without any notice? Do they get 30-60 days to vacate so they can find alternate living arrangements? I was told that the tenancy act will supersede the non legal suite so the tenant cannot be evicted until their lease is up.

Would love some insight if anyone has run into this before

 

[Tina Myrvang]

Thanks for the link Tina. I have been on the COK site before so I am familiar with the info that was in that link.

What I am asking specifically is if the city finds out about a non-legal secondary suite, and there is a tenant in the unit with a lease ... what happens to the tenant? Are they booted out on their butt without any notice? Do they get 30-60 days to vacate so they can find alternate living arrangements? I was told that the tenancy act will supersede the non legal suite so the tenant cannot be evicted until their lease is up.

Would love some insight if anyone has run into this before

Let me look into this further.

 

[Matt Crowley]

What I am asking specifically is if the city finds out about a non-legal secondary suite, and there is a tenant in the unit with a lease ... what happens to the tenant? Are they booted out on their butt without any notice? Do they get 30-60 days to vacate so they can find alternate living arrangements? I was told that the tenancy act will supersede the non legal suite so the tenant cannot be evicted until their lease is up.

Would love some insight if anyone has run into this before

Uh no, municipality has authority to shut you down for a non-compliant development and you will need to get the tenant to leave and possibly if you have a very abusive and knowledgable tenant they will find a way to get you to pay for any cost of relocation and cost of increase in their lease. Most cities can enforce hefty fines for lazy, incompetent, or "just do it my way" fly-by-night developments.

Why own a suite illegally? Why not buy a house with a legal suite? Develop it yourself? It is a little more cash up front, yes but if you are in this for the long haul you need to buy an asset, not an unfunded liability in a suite that is going to get you flagged and shut down. Or, if you think the real estate prices in the area is going to go bananas and you can carry a negative cash flow asset, why not just buy land?

Probably not really smart practice to take advice from people on how to skirt the rules. Not the sort of folk worth hanging out with.

 

[darkness05]

Yes that is what I have decided to do ... I found a bi-level home that fit my criteria that I firmed up yesterday.

I am still curious as to what the truth of the matter was. The duplex was clearing 1K a month with a minimal upfront investment, so it was lucrative enough to look into.

 

[Thomas Beyer]

Many cities do not strongly enforce illegal suites as most BC cities have rental shortages. But they do carry a very big stick and some cities use it but many do not.

 

[Cory Sperle]

Kelowna has a huge rental shortage, and yes the city carries a big stick and uses it often. Avoid non conforming suites here period.

 

[adriano]

Like Corey said, Kelowna is very diligent in enforcing non conforming suites. My Aunt had a place and they made her get rid of the tenant and pay a fine. Not to mention she had to pay to get the tenants to move. Avoid it !

 

[Thomas Beyer]

You only hear about the cases where folks are asked to shut the suites down. You never hear the cases where people are renting for years. That ratio is likely 1:50 or 1:100+ in my estimate. Illegal basement suites are a risk, of course, but enforcement probability is very low if there are no issues with cars, noise, drugs or illegal activity.

If you have a noisy, smoking and partying tenants, with visitors all hours and two rusty cars, OF COURSE neighbors will complain. What do you expect ?

As such, ideally get a single non-smoking, clean tenant with no car ! No one would even notice.

You decide what risk level you wish to take.

 

[darkness05]

Yes I agree with you Thomas. I know many many people here in Kelowna who rent out non conforming suites and have never had an issue. Just like the hotel review sites ... you only hear about the ones who had problems. The other 95% of people are perfectly fine.

Just not a good overall feeling about a suited duplex. Too many things could go wrong here to get involved. Bi-levels are another story as they can be legalized quite easily if it came to that.

Good to know about Kelowna though thanks @Cory and @adriano for the info. I do know that Kelowna has recently stepped up their efforts on legalizing suites to deal with the 1% vacancy rate, so I am curious as to how long ago your experiences were?

Thanks all

 

[Owenb]

My understanding from talking with someone who works with the City of Kelowna is they are also looking to legalize suites in duplexes due to the shortage of rental housing. Now that could either take place soon, never, or somewhere in between! If it does happen it will make for some excellent rental opportunities.

 

[darkness05]

@owen - I have actually heard the exact same thing ... not sure if there is any truth to it but may be worth a call into the City!

 

[Tina Myrvang]

I looked this up on the City of Kelowna's website on Carriage Houses and Secondary Suites:
http://apps.kelowna.ca/CityPage/Docs/PDFs/Development%20Services/Land%20Use/Carriage%20House%20Requirements.pdf Legalized Suites:

 

[darkness05]

Thanks Tina ... the link above is broken but I was able to figure it out. Could you post the link for the legalized suites as well?