After a number of recent civil suits pertaining to the legality of homes sold with basement suites – including one where an agent advertised a suite as being legal, when in fact it wasn’t – the Real Estate Council of Alberta has recommended agents remove that wording from their listings and ads unless legality has been verified.
There’s always been a grey area between legal and illegal suites when listing these types of houses, but now with many real estate agents are erring on the side of caution, the relative values of illegal and legal suites is going to be affected, as are the strategies of investors, according to James Knull, a Edmonton-area real estate agent specializing in investment properties.
“If you’re looking to buy an illegal suite, it’s going to get much harder to find them,” he says. “And the result is that the value of having that legal permit is going to continue to increase.”
Knull says that for investors to stay ahead of the curve, they should work towards legalizing illegal suites if they have any intention of selling them. And for investors looking for turnkey properties, they should be focused on purchasing legal suites.
“Finally, if you’re the type of investor who likes to add value, then finding an illegal suite and legalizing it could add a lot of value to a property.”
While finding those “diamonds in the rough” might be a little harder now with the changes to how they are listed on MLS, Knull says, “if willing to do the work the find them, you can profit from your efforts.”
Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage. Click here to get help choosing the best mortgage rate
Investment Hot Spots:
Cox's Cove, Grand Falls-Windsor, Truro Heights, Beach Meadows, Ripples
The market for homes with secondary suites in Alberta just got a little more complicated for investors with recent changes to the way real estate agents are going to advertise these properties.