Quick Answer
Ontario municipalities offering ARU grants in 2026 include Barrie (Barrie Bonus $15,000 + 50% permit fee reduction), Simcoe County (up to $50,000 forgivable loan), and Waterloo (up to $30,000). Know of a program we missed? Scroll to the bottom of this page to submit a correction or new listing.
> 📬 Know something we don't? If a program is outdated or you know of a new grant, [scroll to the bottom of this page](#submit) to submit a correction — we update the directory within 2 business days.
Why This Page Exists
Ontario has over 400 municipalities — and dozens of them now offer direct financial incentives for homeowners who add Additional Residential Units (ARUs), secondary suites, garden suites, or laneway suites to their properties.
No single provincial directory tracks all of these programs. This page consolidates what we know as of early 2026, with direct links to each program. Programs change, close, and renew frequently — always confirm with the municipality before making investment decisions.
What Is an ARU Grant?
Municipal ARU grants are direct financial incentives — typically structured as forgivable loans, cash grants, or permit fee waivers — offered to homeowners who create new rental units on their existing property. They exist because:
- Municipalities face provincial housing targets under the More Homes Built Faster Act
- Adding an ARU to existing residential land is the fastest, cheapest way to add rental supply
- It costs a municipality far less to subsidize private construction than to fund public housing
In return for the incentive, homeowners typically agree to rent the unit at affordable rates for a set period (commonly 15 years).
Known Ontario ARU Grant Programs — 2026
Barrie (City of Barrie + County of Simcoe Combined)
Barrie offers one of the most layered ARU incentive stacks in Ontario:
City of Barrie — Building Permit Fee Incentives (2026):
- 50% off building permit application fees for all ARUs
- Full rebate on permit fees if occupancy is achieved within 12 months of permit issuance
- Standardized ARU design catalogue available (reduces design costs significantly)
- $15,000 one-time top-up for homeowners already approved for Simcoe County Secondary Suites funding
- Effectively adds $15,000 on top of the County program for Barrie residents
- Contact: HousingCIP@barrie.ca | 705-739-4220 x4416
- Up to $50,000 as a 15-year forgivable loan
- Must rent at affordable market rates (1-bed: $1,426/month including utilities for qualifying programs)
- Year-round intake, first-come-first-served
- Owner-occupied principal residence required for some funding streams
- Can apply for up to 6 secondary suites per property (County-funded stream)
- Contact: iah@simcoe.ca | 705-725-7215 x1119
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Waterloo (City of Waterloo)
Detached ARU Grant:
- Up to 50% of project costs, maximum $30,000
- For coach houses, garden suites, and other detached secondary units
- Funding is limited — first-come-first-served with waitlist when full
- Applications open; confirm current status at Waterloo housing programs page
- Separate stream for market-rate (non-affordable) ARUs
- Smaller amounts; confirm current program details with City of Waterloo
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Hamilton (City of Hamilton)
Ontario Renovates Secondary Suites Forgivable Loan Program:
- Delivered through Ontario Priorities Housing Initiative (OPHI)
- Forgivable loan for renovation/creation of secondary suites
- Focus on increasing affordable rental supply
- Confirm current availability and amounts with City of Hamilton Housing team
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Burlington (City of Burlington)
ARU Grant Program — NOTE: Ended October 1, 2025
- Was offering up to $95,000 for affordable ARUs
- Program closed — watch for renewal under Housing Accelerator Fund replenishment
- Habitat28 modular units were specifically approved under this program
- Monitor: burlington.ca for any new program announcements
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CMHC — Canada Secondary Suite Loan Program (Federal)
The federal government has committed to a national secondary suite loan program:
- Low-interest loans of up to $80,000 for homeowners adding a secondary suite
- Status as of early 2026: program design underway following BC provincial program wind-down
- Expected to be delivered through CMHC
- Monitor: cmhc-schl.gc.ca for launch details
This federal program, when launched, will stack on top of municipal programs for eligible homeowners.
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How Municipal ARU Programs Work
Most Ontario municipal ARU programs share these structural features:
| Feature | Typical Terms |
|---|---|
| Funding structure | 15-year forgivable loan (becomes a grant if conditions met) |
| Rent requirement | At or below CMHC average market rent for 15 years |
| Occupancy requirement | Owner must occupy main dwelling (most programs) |
| Eligible unit types | Secondary suites, garden suites, coach houses, basement apartments |
| DC exemption | Garden suites exempt from development charges province-wide |
| Clawback condition | Must repay if unit sold, re-rented above ceiling, or conditions violated |
The Modular ARU Advantage
For all of these programs, modular construction offers distinct advantages:
- Speed: Factory-built modular ARU in 4–6 months vs. 12–18 months site-built
- Fixed price: No cost overruns — you know your total project cost at contract signing
- CSA A277 certification: Accepted by all Ontario municipalities for permits
- Approval precedent: Habitat28 modular units have specific municipal approvals in Ontario
Important Warnings
Do not make financial commitments based on grant program listings alone:
- Grant programs open and close based on municipal budgets and Housing Accelerator Fund allocations
- Amounts and conditions change; the Burlington $95,000 program closed with little warning
- Always confirm directly with the municipality before starting a project
- Forgivable loan conditions (15-year rent requirements) are legally binding
This Directory is a Living Resource
ModularHomes400.com updates this directory as programs change. If you know of a municipal ARU program not listed here, contact us.
To explore the ROI on a modular ARU in your municipality — with or without grants — see our ARU investment analysis page.
Frequently Asked Questions
Which Ontario municipality has the best ARU grant in 2026?
Barrie currently offers one of the strongest combined incentive stacks: Simcoe County Secondary Suites (up to $50,000 forgivable loan) + Barrie Bonus ($15,000 top-up) + 50% building permit fee reduction. This can total $65,000+ in value for qualifying Barrie homeowners.
Are ARU grants taxable income in Ontario?
Forgivable loans are generally not treated as taxable income when first received, as they are conditional on future performance. However, the tax treatment can vary — consult an accountant before applying for any ARU grant program.
Can I use a modular home for an ARU grant program?
Yes — CSA A277-certified modular homes are treated identically to site-built construction by Ontario municipalities and qualify for ARU grant programs. Habitat28 modular units have been specifically approved for Burlington program requirements.
What happens to the ARU grant if I sell my house?
Most forgivable loan programs require repayment if the property is sold before the end of the commitment period (typically 15 years). The loan is secured by a mortgage on the property title. Read the grant agreement carefully before applying.
Do I need to live in the house to get an ARU grant?
Most Ontario municipal ARU grant programs require the homeowner to be the owner-occupant of the main dwelling. Investment properties where the owner does not live generally do not qualify for affordable ARU grant programs.