What it really costs to build a legal second suite in the GTA, and how much it can earn back
A finished basement is a nice upgrade. A legal basement apartment is an asset. Across Toronto and the GTA, homeowners are turning unused lower levels into fully permitted second suites that bring in steady monthly rent, help carry the mortgage, and add lasting value to the home. Done properly, it is one of the highest return renovations you can make to a house.
But “legal” is the word that matters. A basement apartment is only an asset if it meets the Ontario Building Code and the City of Toronto zoning rules. An unpermitted unit can be ordered closed, can void your home insurance, and turns into a problem the moment you try to sell or refinance. This guide covers what a legal basement apartment costs in 2026, the rules it has to meet, and the rental income you can realistically expect.
How Much a Legal Basement Apartment Costs in Toronto
Legal basement apartments in the GTA start at around $75 per square foot, so an 800 square foot suite begins near $60,000. Most legal suites land somewhere in the $60,000 to $110,000 range once you account for the work that makes them rentable and compliant.
The price moves with a few specific factors. Lowering a floor or underpinning to reach the required ceiling height adds cost. So does cutting in a separate entrance, enlarging windows to meet egress rules, and running full plumbing for a second kitchen and bathroom. Fire separation, soundproofing, and proper permits are part of the number too. We give you a fixed price after an in-home assessment, not a guess over the phone.
What Makes a Basement Apartment Legal in Toronto
Second suites are now permitted in most detached, semi-detached, and townhouse homes across Toronto. Permitted does not mean automatic, though. Every unit still needs a building permit, an inspection, and it has to meet these core requirements:
- A minimum ceiling height of 1.95 m (6 ft 5 in) over most of the floor area. Beams and ducts can dip lower, but they cannot cover more than 20% of the ceiling.
- A separate entrance that leads directly outside, without passing through the main home.
- An egress (escape) window in every bedroom, at least 0.35 square metres, with no dimension under 380 mm and the sill no higher than 1.5 m above the floor.
- Proper fire separation between the two units, including solid core fire-rated doors with a 45 minute rating.
- Hard-wired, interconnected smoke alarms and carbon monoxide detectors in both units.
- A building permit reviewed and approved by the City before any work starts.
All of this falls under the City of Toronto Zoning By-law 569-2013 and the Ontario Building Code. Skipping any of it is what turns a basement apartment from an asset into a liability.
When we build a legal basement apartment, we handle the whole project from drawings to a tenant-ready unit:
- Design and drawings prepared for the permit application
- Managing the building permit and City inspections for you
- Any structural work needed to reach code ceiling height, such as underpinning or benching where required
- A separate, code-compliant entrance
- Egress windows sized to code in every bedroom
- A full kitchen and a three-piece bathroom, with all plumbing and electrical
- Fire separation, insulation, and soundproofing between the two units
- Hard-wired smoke and carbon monoxide alarms
- Flooring, trim, lighting, and finishes ready for a renter
- An included heated floor option for added comfort in the lower level
How Much Rent Can a Basement Apartment Earn?
This is where a legal suite pays for itself. In today’s GTA market, a legal one-bedroom basement apartment in Toronto typically rents for roughly $1,500 to $2,200 a month, depending on location, size, and finish. A two-bedroom suite in a strong neighbourhood can earn more. Actual rent depends on your area and the condition of the unit, so treat these as market estimates rather than a promise.
At that range, a suite can bring in $18,000 to $26,000 or more per year. For many homeowners that covers a large share of the mortgage and pays back the renovation within a few years, while the legal, permitted status adds real value at resale. That combination of monthly income plus long term value is why basement suites are one of the most requested projects we do.
Is a Legal Basement Apartment Right for You?
If your basement has the height, or the potential to reach it, and you want an income-producing suite done to code, this is one of the smartest renovations available in the GTA. The best next step is to see finished work and get real numbers for your home.
Browse our completed projects in the portfolio, read more about our basement renovation service, and see where a suite fits in the full picture in our Toronto renovation cost guide. When you are ready, book a free in-home consultation and 3D design, and we will tell you exactly what a legal suite would cost in your home.
Frequently Asked Questions
Legal basement apartments start at about $75 per square foot, so most suites fall between $60,000 and $110,000. The final price depends on ceiling height work, a separate entrance, egress windows, and plumbing for a second kitchen and bathroom. You get a fixed price after an in-home assessment.
Yes, if the unit meets the rules. Second suites are permitted in most Toronto homes, but the basement must have a building permit, code ceiling height, a separate entrance, egress windows, and proper fire separation. An unpermitted unit can be ordered closed and may void your insurance.
The minimum ceiling height is 1.95 metres, about 6 feet 5 inches, over most of the floor area. Beams and ducts can drop below that, but they cannot cover more than 20% of the ceiling. If your basement is too low, underpinning or benching can create the needed height.
Most legal basement suites take about 8 to 12 weeks of construction, depending on the scope and whether structural work is needed. On top of that, allow time for the permit to be reviewed and approved before work begins. We manage the permit and inspection process for you.
Yes. Every legal basement apartment in Toronto needs a building permit that is reviewed and approved by the City before construction starts, plus inspections during the build. Skipping the permit is what makes a unit illegal and hard to insure, rent, or sell. We handle the permit for you.
