Affordable Housing Development Toolkit: Additional Residential Units

1.1 Understanding ARU Permissions

Local municipalities in Bruce County set rules and requirements for ARUs through their Zoning By-laws and Official Plans. Zoning By-laws typically regulate items such as:  

• Where on a property a detached accessory building can be built (e.g. yard setbacks)
• How many structures are permitted on a property, and how big those structures can be (e.g. lot coverage)
• How ARUs can be used (e.g. not permitted for home occupations)
• General provisions that may apply to all zones and structures (e.g. parking requirements, landscaping) 

Properties that do not have full services, or are located outside of settlement areas, may continue to have separate rules and permissions regarding ARUs. 

Understanding what you can build, where, and how you can use the construction will help you design an accessory residential unit that is compatible with the land it is built on and the surrounding uses. Designing an ARU that fits the zoning will help reduce costs and speed up construction time.

The first step is to find out what the zoning is on a property. Use Bruce County’s Interactive Mapping Tool to help identify the zone of any property in Bruce County. The User Guide will help you learn how to navigate the maps, use the tools, and filter information.

Each municipality has its own Zoning By-law that outlines permitted uses, provisions, and definitions that will aid in designing a compatible accessory residential unit. Find your municipality’s Zoning By-law here.

The table below contains a high-level summary of existing policies for ARUs by municipality.

Please note that there are municipalities in the process of updating their Zoning By-laws to align with established provincial requirements permitting ARUs. Visit your local building department for the most up-to-date information and further details to help you assess your options. Contact information for local municipalities is in Section 4: The Municipal Approvals Process.

For municipalities that have not yet updated their policies, you can also reach out to Bruce County Planning for more information.

Note on garden suites:
Typically defined as portable, detached units, garden suites are intended for use as temporary housing by members or relatives of the household (e.g., an elderly parent requiring care). The intention of policies for garden suites is to fill a housing gap, but with the advancement of policies for ARUs, they have become less relevant.  

1.2 Understanding the ARU Options

There are different pathways you can take to hosting ARUs on your property. For example, you could: 

• Buy a home with an existing ARU – There are builders and developers already creating new homes with ARUs built in.
• Build an ARU into your new home – Look for homes with the intent of putting in an ARU or where the builders and developers have “roughed” in ARU possibility to make modifications easier for homebuyers.
• Build an ARU into your existing home or garage – This could be a conversion of an existing space (e.g., converting a basement into a separate suite) or constructing an addition to an existing structure.
• Build an ARU as an additional structure on your property – This involves creating a new detached structure that is ancillary to the main home. You can build these ARUs on site or bring in a prefabricated unit.  

Creating additional residential units is a big undertaking, but one that has significant benefits for the homeowner and the overall community. To help determine if this option is right for you, consider these questions: 

Here’s how adding an ARU could benefit your family and community:

1.3 Who You Will Work With

You may work with these key professionals to bring your ARU project to life. 

2.1 Design Requirements

When designing your ARU, it’s important to know the specific requirements you must meet, which can differ depending on where your property is located and the type of ARU you’re looking to add. This section contains an overview of design requirements that apply to additional residential units. Make sure you reach out to your local municipality early in the planning stage and engage qualified professionals to understand the specific requirements, constraints, and considerations for adding an ARU to your particular property.

Visual of typical setbacks for an urban residential property

Note: If you cannot meet one or more requirements set out by the municipality, you may be able to apply for relief through a minor variance process. County Planners will work with you and your local municipality to find solutions.

2.2 Design Principals

When designing housing of any kind, it’s important to think about the needs of future residents, the neighbourhood context, and how the unit will last over time. Applying these principles helps to ensure that you get a well-designed product that is a good investment of resources.  

Here are some of the key principles to incorporate into your ARU design. 

Design with People in Mind
Design to fit the needs of residents. Who do you plan to host in your ARU and how might that influence the design? It’s important to think about the everyday needs and experiences from the point of view of future residents and visitors. This applies to the indoor space of the unit, as well as outdoor areas and any shared amenities, like laundry, parking, and storage. Design for accessibility. Thinking about accessible and age-friendly design is critical if you plan to use your ARU for a family member with disabilities or for aging in place. Applying universal design can make your unit accessible and appealing to people of all abilities and save you from making changes later. In some cases, you might want to design your ARU with the intention of making accessibility modifications in the future.   Design for affordability. ARUs can help fill the gap for housing that is affordable to low- and moderate-income households in Bruce County. You could make your ARU more cost-efficient by choosing a modest, yet robust design.
Design with Community in Mind
Ensure that your ARU does not negatively impact surrounding neighbours. This means thinking about shadowing, noise, garbage, lighting, privacy, grading, and anything else that might affect those living on the property or nearby in the neighbourhood. Some of the building requirements, like setbacks and maximum height, help with this. In addition, you could consider adding in features like privacy fences, soundproof walls, and greenery for extra buffering that will benefit both residents of the ARU and their neighbours.   Design to fit with neighbourhood character. It is important to consider how your design will fit in with the look of existing buildings and features in the neighbourhood. Make sure your ARU is compatible in style by paying attention to architectural design and how your ARU looks from the street.
Design for Longevity
Design for flexibility. To give you more options with your ARU as circumstances change over time, design it with the potential of making modifications later, like changing the layout. Design for durability. Use appropriate materials and design features to help your ARU withstand weather conditions (e.g., rain, wind, snow) and to be resilient towards climate change. It is also important to think about how you will upkeep and maintain the unit over time.   Design with sustainability in mind. You could design your ARU to be more energy and resource efficient to reduce its environmental impact. Some sustainability features, like solar panels have a higher initial cost, but may provide savings over time. There are also less costly features you can integrate, like high-quality windows, insulation, and energy-efficient appliances.

3.1 Costing

The table below lists some of the potential costs you may need to budget for.

Choices made in the project planning stages can impact the overall cost of building an ARU. Every property is unique and can present a distinctive set of opportunities and challenges. Work with what you've got: consider the existing primary structure and lot size/shape to help decide if renovating or building new is the more efficient choice. If building a new detached ARU, consider pre-fabricated home builders or pre-approved building plans to take advantage of reduced design costs.  

Applications made under the Planning Act may trigger additional studies required to support Planning Applications (e.g. archaeology assessment, servicing studies, etc.). Know your zone and design within the requirements of the Zoning By-law to avoid additional costs and project delays associated with Planning Applications.  

Making choices to improve energy efficiency at the design and build phase may have higher upfront costs, but lower utility costs over the long term. You may also be eligible for rebates or low-cost loans to help with energy efficiency upgrades. The savings seen in maintenance and operating costs may be worth the investment.  

Designing an accessible ARU creates flexibility, including homeowners looking for long term age-in-place options. Retrofitting an existing space with accessibility features can be more costly than using universal design principles from the beginning. Think about who will be using the space and their long-term needs. Qualifying expenses associated with building an ARU specifically for a senior or person with a disability may be eligible for certain tax credits. 

3.2 Funding Programs and Incentives

Affordable Additional Residential Unit (ARU) Funding Program

The Bruce County Affordable Additional Residential Unit (ARU) Funding Program provides funding in the form of a forgivable loan to homeowners to renovate their primary residence to add a new residential unit that meets affordability thresholds. There are funding limitations. Please check with the Bruce County Housing Concierge to see if you are eligible for this grant as there are specific criteria your project will need to fit, and limited funding windows accepting new applications.

Build in Bruce

Spruce the Bruce – Residential Improvement Grant

The Residential Improvement grant provides funding for business and property owners to upgrade or renovate their mixed-use (commercial-residential) building to add new residential units or increase occupancy in existing units for long-term rental use. Please check with your local municipality to see if you are eligible for this grant as there are specific criteria your project would need to fit.

Spruce the Bruce - Residential Improvement Grant Application

Natural Resources Canada
There are several grants and interest-free loans available as part of the Canada Greener Homes Initiative. The Canada Greener Homes Initiative helps homeowners make modifications to their homes to lower energy costs, improve comfort, and reduce greenhouse gas emissions. This program offers grants from $125 to $5,000 to recoup costs back for eligible home retrofits, up to $600 as a maximum contribution toward the total costs of your pre- and post-retrofit EnerGuide evaluations, and interest-free loans of up to $40,000, with a repayment term of 10 years to help you undertake major home retrofits.

Development Charges Exemptions

Development Charges (DCs) assist in financing capital projects required to meet the increased need for services resulting from growth and development. Bruce County and Municipalities that collect Development Charges have made exemptions for most Additional Residential Units (ARUs), housing that meets affordability criteria, and purpose-built rental units. Development Charges may apply to other renovations to your property, or where there is permission for more than three ARUs on a single lot.

The application of Development Charges is at the Building Permit stage. Automatic removal of DCs will from the calculations where exemptions apply will require no additional applications or supporting documentation from the homeowner. It may not be obvious that these exemptions even exist, but they can save thousands of dollars on permitting costs.

Check with your local Municipality to find out more about applicable Development Charges.

Insured Mortgage Lending Rules

The Federal government recently announced mortgage reforms, making it easier for homeowners to finance ARU construction. Homeowners can access insured mortgages to borrow up to 90% of the property value, including the value added by the ARU.

Speak to a mortgage specialist about how to access insured mortgage products.

Multigenerational Home Renovation Tax Credit

This Federal refundable tax credit for certain renovation expenses related to creating a self-contained secondary unit. The secondary unit must allow a senior or an adult who is eligible for the disability tax credit to live with a qualifying relative. You can claim up to $50,000 in qualifying expenses for each complete and qualifying renovation. The tax credit is 15% of your costs, up to a maximum of $7,500, for each claim you are eligible to make.

Multigenerational home renovation tax credit (MHRTC) : Personal income tax

GST/HST New Housing Rebate

These Federal and Provincial tax credits apply to new housing purchases, including the purchase of a new pre-fabricated detached ARU.

GST/HST New Housing Rebate

Ontario Home Renovation Savings Program

The Ontario Home Renovation Savings Program offers rebates on eligible energy efficiency upgrades made to existing homes.

Home Renovation Savings Program

Municipal Property Assessment Corporation (MPAC)

Connect with MPAC about the property tax implications of adding an ARU. Some ARUs may have an exemption from the portion of a property’s re-assessment value if built to accommodate a senior or a person with a disability.

Exemption for Seniors and Persons with a Disability

4.1 Municipal Information Sheets

This section breaks down the process for planning and approvals, including key contacts and resources.  

Local building departments work with builders and owners to ensure that the Ontario Building Code is met and that every structure is built safely. The building department will have a representative who acts as the Zoning Administrator to ensure that development meets zoning requirements. The municipality will provide guidance on applications, issue building permits, complete inspections, and issue occupancy permits.  

Step 1: Pre-Consultation

The recommendation is to begin all development projects with a pre-consultation. The pre-consultation phase is an opportunity for the Chief Building Official (CBO), or their representative, to review plans for compliance with Building Code and Zoning, answer questions, and provide feedback. The CBO will help identify any deficiencies with plans and may be able to offer alternative solutions.

Be sure to review the building department’s website for helpful resources, FAQ, and guides before the pre-consultation meeting. Preparing sketches of proposed building plans and a site plan prior to the pre-consultation meeting will help to clearly communicate ideas to the Building Officials and Zoning Administrators. The pre-consultation meeting is an opportunity to understand required documentation needs and application of a Building Permit.

Step 2: Preparing an Application

A building permit is necessary when you wish to construct, renovate, demolish or change the use of a building. The pre-consultation meeting should identify the necessary documents for an application, and may include:

• An application and fees,
• A site plan,
• Construction drawings, including details pertaining to footing, framing, posts, beams, rafters, floor joists and guards (for decks) and building height,
• Lot grading and drainage plans,
• Servicing details, including detailed drawings, applications, or permits as required,
• Energy Efficiency Design Summary,
• HVAC calculations (showing heat loss/gain.)

Note: In some cases, the Conservation Authority may require permits to build inside of a regulated area.

Step 3: Apply for a Building Permit

Submit your application through Cloudpermit using the online kiosk at your local building department or from your home.

You can also submit your completed paper application to the Municipal Office. 
Note: Your builder or contractor may be able to apply for any permits on your behalf and guide you through the inspections required.

Step 4: Building Inspections

It is a requirement to have building inspections during construction to ensure that all work completed according to the approved plans and the Ontario Building Code.

Refer to the issued permit for a detailed list of inspections required for your project.

Please notify the building department at least 48 hours in advance to arrange for a building inspection.

You may need a building inspection for the following milestones:

• Before pouring footings
• Before pouring foundation
• Before backfilling foundation
• Completion of plumbing rough in
• Completion of framing
• Completion of insulation
• Final inspection of plumbing
• Occupancy

Note: The Occupancy Permit is what makes an Additional Residential Unit a legal dwelling unit. There may be a requirement for the Occupancy Permit as a qualification for funding and incentive programs.

Contact the Building Department in your local Municipality for more information:

Town of Saugeen Shores
Town of Saugeen Shores Website
Town of Saugeen Shores, Box 820, 600 Tomlinson Drive, Port Elgin ON N0H 2C0
Phone 519-832-2008

Municipality of Kincardine
Municipality of Kincardine Website
Email: buildings@kincardine.ca
Phone: 519-396-3468 ext. 2

Municipality of Brockton
Municipality of Brockton Website
100 Scott Street, P.O. Box 68, Walkerton, Ontario N0G 2V0, Canada
Phone: 519-881-2223

Municipality of South Bruce
Municipality of South Bruce Website
PO Box 540, 21 Gordon St. E, Teeswater ON, N0G 2S0
Email: cbo@southbruce.ca
Phone: 519-392-6623

Township of Huron-Kinloss
Township of Huron-Kinloss Website
21 Queen St. P.O. Box 130, Ripley ON N0G 2R0
Email: info@huronkinloss.com
Phone: 519-395-3735

Municipality of Arran-Elderslie
Municipality of Arran-Elderslie Website
1925 Bruce Road 10 Chesley, ON N0G 1L0
E-Mail: build@arran-elderslie.ca
Phone: 519-363-3039, Ext. 3

Town of South Bruce Peninsula
Town of South Bruce Peninsula Website
315 George Street PO Box 310, Wiarton ON N0H 2T0
Phone: 519-534-1400

Municipality of Northern Bruce Peninsula
Municipality of Northern Bruce Peninsula Website
56 Lindsay Road 5, Lion’s Head ON N0H 1W0
Phone: 1-833-793-3537

4.2 Bruce County Planning

Bruce County's Planning team is available to help bring your ARU project to life:

Selecting Tenants

• When you list your unit for rent, make sure you include all the appropriate information, including an accurate description of the unit and the rental price. Ensure that your rental housing ad is fair and is not discriminatory. See the Ontario Human Rights Commission’s guide on writing a fair rental housing ad. A realtor may also be able to assist you.
• A Residential Rental Application is a form used by landlords to evaluate prospective tenants (there are various templates and tools available online or you can get help from a lawyer). Generally, rental applications should include:
  • Name and contact information of the applicant
  • Consent from applicant to conduct credit checks
  • Addresses of previous lived at locations and time periods
  • Confirmation of employment and income verification
  • References for past landlords
• Ontario provides a standard lease that serves as a contract between the landlord and tenant, also called a residential tenancy agreement. See the Guide to Ontario's Standard Lease for more information and download the template.