Struggling with space or housing costs? Calgary will pay homeowners up to $35K to build backyard suites

The City of Calgary has launched a Backyard Suites Incentive Program, backed by funding from the federal Canada’s Housing Accelerator Fund. The program begins March 2, 2026 and offers up to $15,000 toward construction costs, plus 40% of underground servicing costs to a maximum of $20,000.

There is additional support for heritage homes, projects that require accessibility features and buildings that comply with existing land use bylaws.

For homeowners who have run the numbers and felt the math did not quite work, this could shift the equation.

Why backyard suites are getting attention

In Calgary’s Brentwood neighbourhood, homeowner Jia Cheng recently completed a 900 square foot, two-bedroom garage suite behind her home.

“Think of it not as adding units,” Cheng told Global News (1). “You’re actually changing people’s lives here.”

Her family first considered the idea during the COVID-19 pandemic when her parents were visiting from China.

“There were some frictions,” Cheng said. “Multi-generational living is tricky, but we do want to maintain them — to have them over, to have the ability to visit family, visit grandkids.”

The finished suite allows her parents to stay close while maintaining privacy for everyone. It is one example of what city officials say is a growing trend.

According to the city, there are roughly 400 backyard suites in Calgary. Officials believe that number could rise significantly in the coming years as awareness and financial support increase.

Josh Howes, manager of the city’s Backyard Suites Program, told Global News interest has grown steadily over the past five years.

“We see a lot of family composition, often with somebody in mind… taking an existing property they don’t want to leave… and they’re able to stay there because of the backyard suite,” Howes said.

For families trying to balance care, independence and rising housing costs, that flexibility is often the real value.

The money side: What homeowners should consider

Building a backyard suite is not cheap. Construction costs can run into the hundreds of thousands of dollars depending on size, design and servicing requirements. The city’s incentive will not cover the bulk of the build, but up to $35,000 in potential support can narrow the gap.

Jason Battershill, whose company Garage Suites Calgary built the Cheng family’s suite, told Global News cost is often the biggest barrier.

“We have a lot of people who approach us, but just don’t have enough money to do them. I think the incentive program is really going to help in a lot of cases,” Battershill said.

He expects recent policy changes and financial incentives could lead to thousands more backyard suites over the next several years.

“Once the city gets it out there… people start learning it’s actually available to them, I think it’s just going to be widespread,” he said.

If you’re considering building a backyard suite, there are three main considerations to weigh:

1. Multigenerational living
   A backyard suite can reduce or eliminate the cost of renting separate accommodation for parents or adult children. That can mean shared expenses, lower overall housing costs and potential savings on childcare or elder care.
2. Rental income
   If used as a rental, the suite can generate monthly income that helps offset mortgage payments or fund retirement. However, rental income is taxable and financing terms may differ if the property includes a secondary suite. It is worth speaking with your lender and a tax professional before committing.
3. Long term property value
   Adding a legal secondary suite may increase resale value, but that depends on location, market conditions and buyer demand. It is not guaranteed. Homeowners should review comparable sales and talk to a local real estate professional.

How to learn more

If you are considering a build, start with the city’s official program page, which outlines eligibility and application details.

You can also review information about the federal funding stream behind the initiative through the Canada Mortgage and Housing Corporation, which administers the Housing Accelerator Fund.