What Is a Laneway House?

A Laneway House (or Laneway Suite) is a self-contained home built on the same lot as a detached house, semi-detached house, townhouse, or another low-rise home. Typically, builders place it where a garage or carport once stood. As a result, it’s smaller than the main house on the lot.

Are Laneway Suites Legal?

Yes. Since 2018, property owners in Toronto can legally build a laneway house if their lot meets the city’s criteria. The city now encourages these projects to help ease the housing shortage through an initiative called Changing Lanes.

Before 2018, building a laneway house was complicated and time-consuming. However, the process has become more straightforward and accessible for homeowners who qualify.

How Much Does a Laneway House Cost to Build?

Building a 700 sq. ft. one-bedroom unit above a garage usually costs between $300,000 and $400,000. In terms of labor and materials, a laneway house costs about the same as building any other home in Toronto.

However, several factors influence the total price. For example, digging to add a basement will increase costs significantly. In addition, the unique size and location of the laneway property affect pricing.

How Much Can a Laneway House Earn in Rental Income?

Rental income for a laneway house follows Toronto’s general rental market. A 700 sq. ft. one-bedroom laneway suite can often rent for about $1,700 to $1,800 per month. As a result, many homeowners see laneway suites as an excellent way to add steady income.

What Are the Criteria to Build a Laneway House?

The criteria for building a laneway house are not one-size-fits-all. They depend on several lot-specific details.

First, your rear or side yard must back onto a public laneway for at least 3.5 m.

If the laneway house is taller than 4 m, it must stand at least 7.5 m away from the main home. If it’s under 4 m, the required distance decreases to 5 m.

Keep in mind that modern laneway suites often follow a condo-style, compact design. However, exact bylaws can vary, so it’s important to review them carefully.

Where Can I Learn More About Laneway Suites?

To explore Toronto’s laneway housing rules, check the city’s Changing Lanes program or speak with experts who understand these requirements.

How Do I Build a Laneway House?

If you want to build a laneway suite, contact LandLord Renovations. Our team can:

  • Assess your lot and confirm eligibility
  • Estimate a realistic budget
  • Project rental income and return on investment
  • Plan and manage the full construction process

By working with experienced professionals, you can move confidently from idea to finished home. Contact our team and get started today.