London Expands Secondary-Suite Grants to $45,000 and Waives Building Permit Fees Until September 7

London's revised ARU framework replaces what was previously the Additional Residential Unit Construction Grant Program with a broader, three-tier structure. Eligibility has been expanded from certain detached ARU forms to all types of secondary units, including interior conversions, garden suites, laneway suites, and basement apartments — all now qualify on eligible residential properties.

That is the most consequential change for ordinary homeowners. The program is no longer a niche tool for detached backyard suites; it now reaches the much larger pool of basement and interior conversions where most owner-led ARU projects actually happen.

The three grant streams are:

A separate new stream — the Additional Residential Unit Construction Grant for New Homes — provides up to $20,000 to builders who include an ARU within a newly constructed, unoccupied single-detached home. That grant is aimed at embedding rental capacity at the time of construction rather than waiting for retrofit demand to materialize.

That distinction is where program structure starts to determine project feasibility. A homeowner planning to rent at market rate for a decade can take the $20,000 with no rent ceiling. A homeowner willing to accept rent capped at average market levels can roughly double the grant to $45,000. A homeowner who wants to keep the suite available for a family member, an aging parent, or short-term flexibility cannot use any of the streams — none of the three accommodates non-rental use.

The second piece of the package is a temporary building permit fee waiver, capped at $2.5 million in total municipal cost and active for projects that pull permits between April 29 and September 7, 2026, or until the cap is reached. City staff estimate the waiver will support roughly 1,900 housing units — a figure that is not coincidental, as the next section will show.

Permit fees are a small share of total project cost on a large multi-residential development but a meaningful share on a single ARU. Removing that fixed cost shifts the math on smaller, owner-led projects more than it does on subdivisions or mid-rise construction. The waiver is also targeted to areas already served by transit and is being paired with simplified application guidelines, standardized agreements, and expanded delegated authority for staff — process reform that reduces soft costs on the same projects most likely to benefit from the fee relief.

The window matters. Permits pulled on September 8 do not qualify, regardless of whether the project itself completes within the HAF reporting period. Combined with the 10-year ARU rental commitment, the structural ask on homeowners is real: act inside a four-month window, accept a decade of rental obligation, and the city will pay a meaningful share of the cost upfront.

As of April 1, 2026, London had created 9,902 of its 11,803 three-year Housing Accelerator Fund target units — about 84 percent — with 11 HAF action-plan initiatives reported as completed. That leaves roughly 1,900 units to find before the federal deadline closes the city's three-year HAF window in September 2026. Staff estimates of the permit-fee waiver's expected impact land at the same 1,900-unit figure, which is not a coincidence. The waiver is calibrated to the shortfall.

London's 2025 HAF Annual Update shows the city has already exceeded its Year 1 and Year 2 permit targets — 3,341 against a 3,184 goal in Year 1, and 4,284 against a 3,991 goal in Year 2. The Year 3 permit target is 4,178. The arithmetic of a city that has been outperforming its annual permit goals but still faces a unit-creation gap explains the pivot toward homeowner-scale incentives. Large developments take years from permit to occupancy. ARUs and gentle-density projects can move from approval to completion inside a single construction season, which is exactly the time horizon a federal deadline creates.

Mayor Josh Morgan framed the expansion to all ARU types as opening opportunities for more homeowners to participate while keeping the city on track for its targets. Deputy City Manager Scott Mathers, in the city's own news release, described the strategy as stacking new incentive programs and waiving building fees to help projects move forward quickly. That language matters: stacking is the explicit intent. Grants and fee waivers are designed to combine on the same project, not to substitute for one another.

Eight days before London's announcement, the City of Vaughan ratified a policy reducing residential development charges to zero for projects that begin construction between February 25, 2026 and October 31, 2027. Before earlier 2024 reductions, low-rise residential development charges in Vaughan ran around $94,466 per unit, with a subsequent step-down to $50,193. The Toronto Regional Real Estate Board estimated the temporary zero-DC policy could save up to $50,193 per low-rise home during the exemption window.

Vaughan and London are using different levers — one waiving development charges that hit builders, the other stacking grants and permit-fee waivers that hit homeowners — but the underlying logic is the same. Both cities are HAF participants facing federal deadline pressure. Both are using time-bound, structural fee changes to move projects from approval into construction. And both have moved in the same eight-day window after years of more incremental approaches.

Three other Ontario HAF cities have already laid out the architecture for similar moves. Burlington has reduced as-of-right zoning friction for up to three ARUs on urban lots and launched its own ARU Incentive Program. Mississauga, which has received more than $84 million in HAF funding to date, is operating a "gentle density incentive program" that grants relief on city fees and development charges for ARUs and fourplexes, and has already reduced or eliminated development charges on residential housing since January 2025. Hamilton's HAF action plan includes an Acceleration Program for Accessory Dwelling Units and Multi-Plex Conversions backed by an annual federal allocation of $23.5 million.

For homeowners in HAF-deadline cities, the practical takeaway is that municipal incentive math is changing fast and the windows are short. London's package is the second concrete data point in a pattern that is now visible in real time. For Londoners specifically, projects that previously sat just below the line of financial feasibility — modest basement conversions, garden suites, or built-in ARUs in new construction — may now pencil with the combination of stacked grants and waived permit fees, provided the homeowner can accept the 10-year rental commitment and pull the permit before September 7.

The broader signal is harder to miss. Cities are no longer waiting for federal program design to deliver the units the Housing Accelerator Fund was supposed to fund. They are building the math themselves, calibrated to their own shortfalls, and they are doing it in compressed windows that reward homeowners who can move quickly. London is the second Ontario city in eight days to confirm that direction. It is unlikely to be the last.