Everything “multigenerational” is trending it seems, and even politicians are jumping on the band wagon.

There’s a new tax benefit available for your 2023 tax return called the Multigenerational Home Renovation Tax Credit (MHRTC).

Adding a suite

If you are adding a “secondary unit” to your home so that a relative or caregiver can move in to help a senior, or a parent can move into in to your home to get assistance, you make it more affordable by claiming the MHRTC, according to the website, Everything Zoomer. 

To qualify for this credit, the secondary suite must have the following features:

If you did this kind of work in 2023, get your receipts ready to file because you can claim up to $50,000 of the renovation cost as a tax credit. In return you’ll get a tax credit of 15% even if you don’t owe any tax.  

Now $7,500 is not likely to encourage you to run out and hire a renovator.  Average renovations run in the range of $600 per square foot in Toronto. So even a modest 650-square-foot secondary suite could be $400,000ish.

Tax credits expand project

However, if a renovator is quoting on the secondary suite and you want to make the rest of your home more accessible with items such as:

then adding these into the project may get the additional work done at a more affordable additional cost.

These upgrades are made more attractive by a couple of tax credits that have been around for a while: the Home Accessibility Tax Credit (HATC) and the Disability Tax Credit (DTC).  Like the MHRTC, the amount involved seem relatively small at face value.

However, the tax expert quoted by Everything Zoomer had some interesting advice about these taxes that could make it worth pursuing them.

Double dipping

Tax tips for making multigenerational housing more affordable including claiming tax credits

Gerry Vittoratos, a Montreal-based expert for the tax preparation software company UFILE, told Everything Zoomer that the DTC can be retroactive if you undergo the eligibility assessment process, and you have suffered from the disability up to 10 years. So, if you’ve had tax owing at any point in the last decade, the government will pay you the DTC refund in one lump sum. Depending on your tax situation, the DTC could be worth $1,500 to $2,500 for each year of disability.

If you have qualified for the DTC you also can qualify for the HATC, and Vittoratos says the beauty of that credit is that you can “double dip” – your renovation expenses may also qualify as a medical expense, and you can claim for both on your tax return. 

As a new builder whose FlexPlex building is perfect for multigenerational living and creating up to three additional suites in a home, I am curious how these tax credits can be used in my next building.  If you know, let me know!

Picture of Doug Ford in a backyard surrounded by signs

Everyone is looking for solutions to housing affordability.

The federal government thought it had part of the solution. It asked the provinces to mandate fourplexes across the country.

But here in Ontario, Doug Ford is not a fan of four-unit multiplexes.

The Premier said he has no problem with putting four units on a residential lot. But he said – incorrectly – that a fourplex is a four-storey “tower.” Then he said “no” to the opportunity to build fourplexes everywhere in the province.

Seeing is believing
The FlexPlex looks like a single-family home from the exterior

If only Premier Ford had seen our three-storey FlexPlex® before he jumped to conclusions. We designed the FlexPlex – capable of quickly and easily transitioning between fourplex-triplex-duplex-single-family home layouts – to fit into existing residential neighborhoods. We think that the FlexPlex model strikes the right balance between the need for more density and concerns about density in single-family areas.

Even an independent observer, The Globe and Mail, reported that the FlexPlex “presents a handsome, single-family face to the street.” It said the only giveaways that it’s a fourplex-ready multi-unit building are the four doorbells at the front door.

Financial Feasibility

Ontario has mandated that triplexes can be built anywhere in the province. But the response has been low. To finance new housing, investors need more rental income than a triplex can provide.

 That’s why Toronto and Mississauga, among others across Canada, have allowed four multi-family units everywhere and have cut the development charges that stand in the way of building them.

There is no point in allowing something that’s financially infeasible.

Revitalizing neighbourhoods

However, in both cities, neighborhoods are protected from “towers”. Fourplexes are subject to height and setback restrictions just like single-family houses. There are new single-family homes in and around the FlexPlex, in the Mimico area in Toronto, that are similar in height to our three-storey building.

More families can live in single-family neighborhoods with more density

But instead of housing three or four people in a 4,000 square foot single-family home, the FlexPlex can have up to eight bedroom/private bathroom combinations and up to four kitchens or food prep areas in the same size residential building.

Carolyn Whitzman, author of Home Truths: Fixing Canada’s Housing Crisis, is quoted in the media saying the majority of single-family residential neighborhoods in Toronto house fewer people than they did 30 years ago. “That’s not a good thing,” she said.

Amber Shortt’s “Living Here” newsletter for the Toronto Star says providing multi-unit buildings can turn this around. Shortt reported that a New Jersey neighborhood revitalized flagging community by introducing multiplexes into single-family zones. “The population has since risen by 40% allowing the town to reduce its taxes all while seeing a revitalization of its main street.”

Housing Innovation

There’s a growing interest in fourplexes, particularly in suburban settings. We’ve received numerous inquiries from property owners across Ontario who want to explore this innovative approach to affordable housing.

By denying the fourplex model, we think the Ontario government is standing in the way of an important innovation in affordable housing.

Doug Ford has changed his mind before. Hopefully, when presented with additional information and alternative perspectives, he’ll say “yes” to fourplexes as part of the solution to our housing crisis.

There’s misinformation about electric air-source heat pumps out there that could separate you from your money.

We’ll do our best to debunk them.

Urban myth #1
Natural gas furnaces are cheaper than heat pumps.

Heat pumps are the lowest-cost option for heating and cooling most homes in Canada. This finding is based on two recent reports:

These findings are the result of low heat pump operating costs. Heat pumps are unbelievably efficient, typically producing 300%-400% as much energy as the electricity that powers them. In comparison, high-efficiency natural gas furnaces are just 90-99% efficient.

It’s difficult to compare the cost of a heat pump to just a natural gas furnace as the heat pump replaces two systems in your home – the furnace and also the air conditioner.

Using the FlexPlex® an example, the cold climate heat pump wins out over the air conditioner/high-efficiency natural gas furnace, according to the Canadian Climate Institute’s calculator:

Cold Climate Heat Pump Heating and Cooling:                         $1516

Air Conditioner & Gas Furnace:                                                  $1730

Visit www.heatpumpcalculator.ca to try it for yourself.[2]

Urban myth #2
It’s too cold for heat pumps in Ontario

Cold-climate air-source heat pumps work well in Southern Ontario. They work to at least -30 degrees C. The coldest Toronto temperature recorded since 1960 was -25 degrees C.  

Heat pumps provide high levels of indoor comfort and warmth.

Heat pump technology is improving by leaps and bounds so by the time you shop for a heat pump, they may very well work below -30 degrees C.  

If your house is highly insulated and air-tight, you won’t notice the difference in heat pump performance on cold days. In fact, the FlexPlex® heat pump system works so well that if the temperature is set above 18 C it can feel a tad too toasty.

Urban myth #3
You need natural gas backup if you have a heat pump
Air source heat pumps work well in Toronto's climatic conditions to provide high levels of indoor comfort in cold weather

Some heating and cooling companies push the idea you need natural gas as a backup for a heat pump (probably based on information from the gas company).  What they’re suggesting is effectively adding a heat pump to a natural gas furnace.

Instead, some back-up electric heat – like an electric coil in the ductwork, or a heat-throwing electric fireplace – can do the trick if you home is well-insulated.

It’s only in very cold climates like Edmonton or Saskatoon that a more substantial back-up heating system is advised. 

Urban myth #4
You’re worse off with heat pumps than natural gas during a blackout
We compare the performance of heat pumps and natural gas furnaces during a power blackout

In an electricity failure, neither natural gas furnaces nor heat pumps will work.

All gas furnaces rely on electrically driven components to work. They also have safety systems that also prevent them from operating in a blackout.

In the case of the Flexplex, this highly insulated building will retain heat for a very long time. We expect that the electricity will be back on long before the building is cold.   

*The information in this article is based on Greenbilt’s research and our operating experience with heat pumps in our Flexplex® showcase home.


References

[1] “Cold-Climate Air Source Heat Pumps: Assessing Cost Effectiveness, Energy Savings and Greenhouse Gas Emission Reductions in Canadian Homes

[2] We made some adjustments to the calculator to make the assumptions realistic for the FlexPlex.

Many Canadian housing markets look like they’re Climbing the Wall of Worry. Does this mean you should be worried?

Toward the end of long bull markets, stock prices follow a pattern called “Climbing the Wall of Worry”. The worry shows up as periods of falling prices following negative events like the pandemic. But it ends up as a blip in a long up-market, and the bull run eventually returns.

This stage of a bull market isn’t peaceful for an investor.

You may agonize over whether to lock in your profits during market gyrations. Nothing lasts forever, including bull markets. 

Housing prices are climbing a wall of worry after a long bull market in Toronto

However, there’s a difference between your real estate and your stock portfolio. Your property is probably your biggest asset, but it’s also the roof over your head. You don’t sell it in one mouse click.

Toronto market outlook

So, you probably would like a crystal ball into the future. Let’s focus on Toronto because we have the most data about that market.

There is a lot of debate about what caused this long bull market in Toronto real estate. In our opinion, there are three key reasons. Toronto is:

To end the housing crisis, Toronto’s finally on a path to allow a lot more apartments in the housing mix.

But, to build enough apartments to ease the housing crisis, more things have to change. There is no short-term fix.

Until then, we expect continued tight Toronto housing markets will cause:

For the real estate junkies in the crowd, we are presenting 2023 Canadian property returns. It shows that residential was the top-performing property type in Toronto in the last year.

The top-performing property type in Toronto in 2023 was residential real estate
The top-performing property type in Toronto in 2023 was residential real estate

Protecting the value of your property

If you own Toronto real estate, it looks like prices will continue on their long-term climb with some worry from time to time. But you’ll minimize any risk of loss if:

In the end, flexibility protects values and is part of a future-proof building.

Stairs can add to the sustainability and flexibility of a home

I’m twice over the moon.” 

Two heads are better than one.

Twins are double the fun.

Our language suggests that two are better than one.

We agreed, and that’s why we put double staircases in different model homes that Greenbilt Homes designed and built.

“Double, double, toil, and trouble,” you say! Is the extra cost and effort of a second staircase worth it?

FlexPlex® stairs

Toronto Star photo of exterior staircase of the FlexPlex

A photo of the FlexPlex exterior staircase was published in the Toronto Star in December, 2023

The answer is a resounding YES. A second staircase offered a huge improvement in functionality.

The most recent double staircase design is in the FlexPlex® home that Greenbilt designed and constructed at 19 Burlington Street, Toronto.  We knew that residents of a 55-foot-long building would appreciate having a rear external staircase.

But we thought the tenants would prefer the interior front staircase because it’s a climate-controlled, bright, and appealing.

We were wrong.  The rear staircase is used the most. It’s very handy as it’s adjacent to the kitchen and living areas.

In future, the addition of an exterior elevator down the centre of the stairscase can add to the home’s flexibility for tenants with mobility issues.

Greenbilt House stairs

Second staircase in a sustainable house

The green-certified Greenbilt House in Bronte Habour, Oakville also featured a flexible second staircase.

Greenbilt House was modelled on a mid-1800s farmhouse and featured a grand staircase in a front foyer with two-storey vaulted ceiling.  

In traditional homes, the rear staircase was a servants’ staircase.  In the case of Greenbilt House, the second staircase was located in a large mudroom/laundry with the garage entrance. It’s how goods came and went from house to garage.  It’s how clothes moved to the laundry room, and how people entered the backyard.

As you can imagine, that rear staircase was heavily used.

In future, if a secondary suite were added to the building, it would create a direct exterior entrance for the tenant.

Low-cost sustainability

The cost of adding a second, utilitarian staircase is fairly low.

The second stair represents flexibility. We believe it’s an important element of sustainability.

In the event of a fire, it provides safety.

Ying and yang

But, like most things, there’s ying and yang.

I can bet that at least one teenager has said: “OMG they’re home early. Quickly, out the back stairs.”

Meet the family behind Greenbilt Homes

Dad and Mike talk about Greenbilt Homes

Mike Manning’s father is an engineer who built things.  Mike says the apple doesn’t fall too far from the tree.

Mike turned his fascination with building into a profession that’s also a family business.

He completed a 3-year diploma in architectural technology at Algonquin College and began working in condo development in Calgary.  Soon he was working on the development site more than at the drafting table.

Mike eventually repositioned his career to work in commercial construction. The pinnacle was joining the team that built Toronto’s Scotia Plaza.

In the 1990s, Mike formed his Toronto residential construction company and that’s when he started a long professional association with his brother Stephen Manning, who today has his own homebuilding company in Ottawa. 

Stephen and his son Tyler pinch-hit for Mike on his biggest and most important jobs, including the FlexPlex.

We value their great contributions to the company.

Greenbilt Homes

Mike’s son Riley supported his dad’s vision to focus on sustainable construction. Riley told his friends’ parents that his dad was a green builder and eventually a parent called Mike up to ask about his services.  That was the nudge behind renaming the company Greenbilt Homes in the mid-2000s,

Mike’s wife Catherine joined the company to do R&D on green buildings. They still talk business strategy over breakfast after all these years. 

Back in the day, the kids chipped in by delivering flyers. As Eric, Riley and Alana got older they also helped with digital media. They continue to be involved in important ways even as they pursue their own careers today.

Even the extended family is involved. Mike’s cousin Heather Manning of Firefly Designs is our interior designer.

As you’d expect, Mom and Dad are always a listening ear on business matters. Dad weighs in using the practical experience of an engineer.

In some ways, running the business can be tough on the family. But when it comes to building a business based on passion, nothing beats our family affair.

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