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.

Nestled in one of the Greater Toronto Area’s leafy neighborhoods is the FlexPlex home. This innovative model home is designed to inspire multigenerational living, accommodating the growing trend of extended families living under one roof.

The Rise of Multi-Generational Living

Recent research has uncovered a noteworthy trend that’s gaining momentum in Toronto – multigenerational living. This phenomenon, which has seen substantial growth in the United States over the last five decades, is driven by the shared challenges of housing affordability. As Toronto grapples with housing costs, this trend is likely to persist, thanks to the financial benefits it offers.

The research also highlighted that, in addition to financial considerations, family caregiving plays a pivotal role in the choice of multigenerational living. Contrary to the assumption that multigenerational living might be stressful, the research reveals that more than half of adults find it to be a mostly or always rewarding experience. As someone who recently shared their household with their daughter’s family for a month, I’d bet that nearly 100% of children would support living with doting grandparents.

Embracing best practices in “multigen” living is increasingly crucial in Toronto, as it offers a promising solution to housing affordability, as well as addressing the needs of both elders and childcare.

Financial Benefits of Owning a FlexPlex Home

When the financial burden of securing a down payment or qualifying for a mortgage becomes too heavy to bear independently, it’s time to join forces with your family. A significant aspect of the affordability of owning a FlexPlex home comes from the idea of it being your “forever home.” This concept helps you avoid costly realtor fees, high property purchase taxes, and the potential HST for each move you didn’t make.

What’s more, the City of Toronto is making it easier for multigenerational living by eliminating development charges on the construction of duplexes, triplexes, and fourplexes while increasing them for condos. These development charge savings make the triplex an appealing alternative for today’s homebuyers.

Don’ts of Successful Multigenerational Living
#1 DON’T – Try to Accommodate Every Family Member in Every Meal

Provide families with the opportunity to have as many kitchens as they desire. In a FlexPlex home, you can strike a balance between interaction and privacy, making multigenerational living comfortable for everyone. Whether you prefer a traditional, interactive single-family home with up to four kitchens or separate units for each family group, FlexPlex offers the flexibility to adapt your space to your needs.

Consider the future – as family dynamics evolve, you can downsize within the FlexPlex by easily converting part of your space into rental accommodation. And when the grandkids arrive, you can “flex” back into a multigenerational home. With private bathrooms for every bedroom, independent heating, cooling, and soundproofing on each floor, reconfiguring the home is a breeze.

#2 DON’T – Give Your Adult Kids Unsolicited Child Rearing Advice

The last thing you want to hear as a parent is, “I don’t want to hear it!” Offering unsolicited parenting advice is a definite DON’T in the realm of multigenerational living. My recent experience with my Vancouver-based daughter and her family living with us for a month emphasized the importance of respecting boundaries.

The Benefits of Multi-Generational Living – A Real-Life Story

Let’s take a moment to delve into the benefits of multigenerational living through a heartwarming story. Meet Zack and Jesse, a young couple with an aging bungalow. They decided it was time to upgrade their living conditions to accommodate their growing family. Simultaneously, Jesse’s parents, who lived in the original family home, were looking to downsize.

Their solution? A multigenerational legal duplex, where each family has an individual unit, allowing three generations to coexist harmoniously. Greenbilt Homes had the honour of building their home. The result? Seven years into it, they have a happier and more spacious living arrangement, while also saving on purchase taxes and realtor fees.

Are you ready to unlock the potential of multigenerational living? Reach out to us to learn more about how a FlexPlex – either a three-storey fourplex version or a two-story triplex or duplex – can shape your family’s future. Your dream of a more affordable and connected living space is just an email away!

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