Accessory dwelling units (ADUs), or second suites, are a relatively quick and easy way to create additional housing that doesn’t change the character of a neighbourhood with larger buildings. However, with costs for renovations increasing, the payoff for property-owners takes too long to be worth it.

Niagara’s extremely tight rental market drives rents up and decreases housing affordability. The lack of housing makes it difficult for the region to attract young workers and newcomers who will grow the workforce. Higher rents drive wages upwards as the cost of living increases. There is an urgent need for more affordable housing and more rental units in Niagara.

The rental vacancy rate in Niagara is 2.7%. In the last ten years, overall rates have fallen as low as 1.4%. A vacancy rate of 5-10% is considered optimal, 3% is considered the minimum for a healthy rental market, and 1-2% is a crisis.

Transforming a basement into a legal ADU in Ontario can cost between $90,000 and $160,000, depending on the work required and materials used, for example. The previous ADU grant in St. Catharines was $20,000, and was very underutilized, with only 8 applicants in the 2023 calendar year. Even with the grant, it would take decades for a homeowner to recoup the cost of renovations through rent.

The GNCC (successfully) lobbied for the City of St. Catharines to increase the ADU grant to $80,000. This increase has made the program much more successful, with high enough uptake that the City has had to turn away applications. The GNCC encourages other municipalities to explore this option to incentivize market-driven “gentle density” increases in housing stock.

2024 (concluded)