Sunday, January 26, 2014

Bank of Canada rate decision

Bank of Canada kept it’s overnight rate at 1% as expected. Inflation forecasts are lower than previously anticipated so rates will be “lower for longer”. Bank of Canada will not likely begin to raise rates until the later part of 2015. As a result of this dovish stance both the Canadian dollar and bond yields were down yesterday. A lower Canadian dollar will help with exports and the growth of the Canadian economy as a whole. Lower bond yields results in a drop of fixed mortgage rates. This benefits in qualifying clients as the 5 yr fixed rate is used as the qualifying benchmark in many instances.

Saturday, January 11, 2014

Why Basements Leak?

Leaking basements are a big problem. When water gets into a basement it can affect your whole house. Understanding why basements leak is the first step in preventing leaking in your basement. It can cause foundation damage and even introduce harmful mold. If you spot mold, chalky white powder, or brown stains on your concrete walls this may be an indication you have a problem. Some of the problems are due to the following:

Cracks or Holes in the Walls or Foundation

One of the most common is simply water running into the basement through the wall joints, seeping through the floor and coming in through cracks. Problems like this can be solved by a variety of waterproofing techniques.

Plugged Weeping Tiles

Sometimes basements leak because the drainage system around the house is clogged and that causes water to back up and flow into the basement. This can be solved by replacing an old weeping tile system.

Leaky Windows or Blocked Drainage Tiles in Window Wells Hydrostatic Pressure

Another common leak is through basement windows. When there is a lot of rain or snow drainage, windows can leak since they are at ground level. Installing new window wells (with proper drainage), can help to solve this problem

Hydrostatic Pressure

Ground water moves upward when the soil becomes saturated during heavy rains; pushes up from under the floor and makes its way in at the footer joint. The solution! Install an interior Pressure Relief System - connected to a sump system. Basements by nature are generally damp. Most basements require the use of a dehumidifier to rid excess moisture form the air. Moisture can be just as damaging as a leak if left untreated. Basements will leak because it is just natural. Basements are located below ground and if they are not properly waterproofed, then leaking will occur. They are more susceptible to water leaking because they are closer to water sources and at the perfect level for drainage issues. By understanding the common causes of basement leaks you can help to prevent leaks in your basement.

Wednesday, January 1, 2014

Basement Apartments - What's Legal?

Is it 'legal'?
'Legal' involves five separate issues including -
  • Do the local bylaws permit you to have a basement apartment?
  • Does the apartment comply with the fire code?
  • Does the apartment comply with basic building code requirements?
  • Does the apartment comply with basic electrical safety requirements?
  • Has the apartment been 'registered'?
**We will look at these issues more closely.  
Building code vs. fire code
The Building Code prescribes minimum requirements for the construction of buildings.
For the most part, the Building Code is a code that applies only the day the house was built. The code changes over the years, but we don't have to keep changing our houses to comply with the code. The code does not apply 'retroactively'.
The Fire Code is a subset of the Building Code. It prescribes construction and safety  issues as they relate to how the building is required to perform should it catch fire. A significant distinction with the fire code is that it can apply retroactively.

Basement retrofit
Now that we know that the Fire Code applies retroactively, we can see where the phrase " basement retrofit" comes from. A new Fire Code was developed that applies to basement apartments. The code applies retroactively, so all basement apartments whether existing or new must comply with the new Fire Code. All owners of homes with basement apartments were given a period of time to upgrade their homes to comply with the new Fire Code. This 'grace period' has long since passed.
Certificate of compliance
All basement apartments have to be inspected to verify that they are in compliance. Once this has been verified and any improvements completed, the apartment is given a 'certificate of compliance'.

We mention this term here to make sure that we don't confuse bylaws with building codes. Bylaw in the context of basement apartments refers to whether you are permitted to have a basement apartment in your area and any special conditions involved. Bylaws are set by municipalities to keep people from being a nuisance to their neighbours. Codes are health and safety rules to protect occupants.

Basement Apartments - The History
Prior to 1993, there was little to worry about. After 1993, a permit was required to change a home from single family to multi-family. 
In 1994, the NDP government in Ontario said that we could ignore local bylaws that prohibited second dwelling units in houses if certain conditions were met. In 1994, the province set new Fire Code rules for basement apartments. A deadline was established for all existing basement apartments to upgrade to the new fire code. Upgrading to comply with the new fire code is called a "retrofit". The owners were allowed to apply for an extension for up to two years past the deadline if they had financial or logistical obstacles. Even with the extension, the deadlines have long since passed.
In 1995, the provincial Conservative government told municipalities that they could enforce their bylaws regarding basement apartments. A grand-fathering clause says that apartments existing before November 1995 do not have to meet local bylaws.

The Evaluation Process


If you are thinking of adding a basement apartment here is the procedure -
Check the Zoning Bylaw at City Hall Buildings Division to find out if basement apartments are allowed. 

  • Check the Zoning Bylaw at City Hall Buildings Division to find out if basement apartments are allowed.
  • You would then apply for a building permit. Keep in mind that you will have to comply with today's building codes.


This report will focus on existing homes with a single basement apartment.

  • The first step is to check with Municipal Property Standards or the Fire Department for a Certificate of Compliance. If there is one, you are done!
  • If the unit is not registered, you need to do some more work
  • Verify that zoning bylaws permit a basement apartment. In most cases they do.
  • The next step is to have the fire department inspect the home. They will verify compliance with the fire code. This is the most daunting part of the process because any deficiencies will have to be corrected by order of the fire marshal.
  • The next step is to have the Electrical Safety Authority (which used to be called Ontario Hydro Inspection Department) inspect the electrical system. Once again, you will be required to make any improvements that are prescribed.
  • If the apartment unit passes the inspections, the unit can be registered with Municipal (Property) Standards (If not, improvements may cost $15,000 or more).

Four Key Elements
  • Fire containment.
  • Mean of egress.
  • Fire detection and alarms.
  • Electrical safety.

Let's look at each of these.
1. Fire Containment
The goal is to contain the fire in the unit that the fire started, long enough to get all of the occupants out of the house. This means that any walls, floors, ceilings and doors between units should control the fire for at least a few minutes. These components are given ' ratings' of how long they will survive a direct fire before burning through. A 30 minute
rating means that the component will control the fire for at least 30 minutes.
The typical requirement is a 30 minute separation between the units.
  • Drywall and plaster are acceptable. but suspended (T-bar type) ceilings are not.
  • The ceiling must be continuous. For example, this means that you can't have exposed joists in the furnace room - this area has to be drywalled or plastered as well.
  • Doors should be solid wood or metal - at least 1¾ inch thick.

2. Means of Egress - Escaping the home
The goal is to allow the occupants to get out of the house if there is a fire. There are two common situations; either each unit has its own exit, or there is a common exit. If each unit has its own exit, you are all set. If the units share an exit, it is more complicated.  A common exit is allowed if it is 'fire separated' from both of the units with a 30 minute
rating. If the common exit is not appropriately fire separated, you can still use this common exit as long as there is a second exit from each dwelling unit and the fire alarms are interconnected (if one alarms, the others will alarm as well).
Here is an example:
There is a common exit area but the common area does not have a 30 minute fire
separation between both of the units. If there is an 'acceptable' window for an escape
route and the smoke alarms are interconnected, we are all set.
What is an acceptable window?
  • The windowsill must be within 3 feet of grade. We don't want people jumping and breaking a leg.
  • The smallest dimension is 18 inches.
  • The opening is at least 600 square inches (30 inches by 20 inches for example)
  • If there is a window well on a basement window, it must extend 3 feet out from the house wall, to allow room to crawl out.

3. Fire detection
All units must have smoke alarms. The owner of the property is responsible for ensuring that there are smoke alarms and that they are maintained. The smoke alarms do not have to be interconnected unless the fire separation to the common exit area does not have a 30 minute rating (Note: It must have at least a 15 minute rating). A carbon monoxide detector (CO detector) may be required by the city.
4. Electrical Safety
An electrical inspection by the Electrical Safety Authority is required. The Electrical Safety Authority used to be called Ontario Hydro Inspection Department. All deficiencies must be addressed. 
General Rules
Here are a few rules that your apartment must meet.
  • All bathrooms need either a window or an exhaust fan
  • If there is a parking spot for one of the units, there must also be a parking spot for the other unit (yes, you read it correctly!)
  • The minimum ceiling height is 6 feet 5 inches
  • The entrance door size must be at least 32 inches by 78 inches

Inspections and their costs
As we already pointed out, two inspections are required, fire code inspection and electrical safety inspection.
Once the inspections are done, you will be required to make the prescribed improvements. Improvements may be minor, but can cost $15,000 or more.
There is lots of room for the inspectors to be more or less 'strict'. In municipalities that encourage basement apartments, the inspection may be lest strict. In municipalities that discourage basement apartments, the inspection may be more strict.
Inspections for fire code compliance cost between $120 and $300. Inspections for electrical safety cost $72.

The consequences

If you are going to represent the property as two family, verify that it is registered with Municipal Property Standards. Failure to comply can result in a $25,000 fine and one year jail term.


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