Would you buy someone’s backyard for $1 million? It may be one of the few spots in Toronto where you can ‘own’ a laneway house

A Kensington-area homeowner is selling his backyard for just under $1 million, billing the more than 1,000-square-foot lot with a garage as the perfect spot for a laneway home.

But unlike just about every other laneway house in the city, this proposed one on Croft Street, near Bathurst and College streets, could be bought without an accompanying house, as - after more than three years of applications and appeals - the owner managed to sever his property into two separate lots.

How? The lot sits on Croft Street, one, if not the only, laneway in Toronto to feature municipal amenities necessary for a stand-alone home, according to one city planner.

The garage's neighbours include two other laneway homes for sale at $3.25 million and $2 million - both sleek, modern homes jutting out between graffiti-covered garages in the alleyway.

The listing for the backyard comes with plans for a laneway house that features a yard, rooftop terrace and parking.

In 2016, owner Mark Teitelman, having noticed laneway houses across Croft, saw an opportunity. He wanted to bisect his property and sell the back half. But he didn't want the resulting laneway house to be a rental. In his view, that would offer him less flexibility and create more work for himself.

If I built a laneway rental, all the services would have had to come through the main house, so I'd have to dig through the whole backyard," he said. That didn't appeal to me."

Instead, he embarked on a more than three-year ordeal to try to get city approval for the severance - even though he lived in Toronto's property severance Goldilocks zone.

It was horrible," he said. It was torture. I almost gave up so many times. At first when I applied, the city said, No way, don't even think about it.' But there was another guy down the street, an architect, who managed to do it, so I went through him to the Committee of Adjustment. But that didn't fly, so I had to appeal it at the Ontario Municipal Board, and finally managed to get permission there.

A decision that should have taken three months took three-and-a-half years."

In 2019, Teitelman was finally found to meet all the conditions necessary to sever his property and have a laneway house built. He believes the city didn't want laneway housing to flourish."

For its part, when the city passed its bylaw allowing laneway house construction in 2018, it hoped to diversify downtown housing options by opening up more affordable space - envisioning these homes as rentals only. Since then, about 50 such houses have been built.

According to senior city planner Graig Uens, there are few laneways such as Croft Street that have all the necessary amenities to make property severance work. While all homeowners are free to apply for it, it's not a realistic goal for almost anyone.

The reason Teitelman's bid eventually succeeded is that Croft isn't like other laneways.

Croft is a peculiarity among laneways in the city," said Uens. It's one of the exceedingly rare public laneways that has its own services. So, it has water, sanitary, storm services, garbage removal, snow removal, mail delivery - just about every public laneway in the city doesn't have these things."

Without access to its own services, a laneway house needs to connect to the services of its parent house. This could create complex legal circumstances if the homes had different owners.

When you rely on the house for services, it becomes really complicated from a legal perspective," said Uens. If you're to sever off the back property, and all of a sudden your water and sanitary connection run underneath the property behind you, there has to be some kind of easement or common element condominium agreement in place that makes (the laneway) property basically subordinate to the other property in perpetuity."

Still, despite the trouble it could cause, some homeowners on other laneways have made it work.

The laneway house will always generally be subordinate to the main house, even if it's been severed - unless you're in a situation like Croft Street," Uens said. But people have severed off the backyard and gone through the whole process of creating separate ownership. It happened, they're built now and occupied, but from a technical point of view, it was very challenging to make it work."

One such example is a property near Dovercourt and Dundas, where the homeowner applied to sever the lot in order to build two laneway homes. The application for the construction of laneway houses was put forward in 2003 and approved in 2011.

Now, the owners have reciprocal easements in place to deal with service sharing. But Uens cautioned that if anything ever goes wrong with the service connection to any of the three houses, it could be difficult to deal with.

But Uens remains a proponent of increasing the number of rental laneway houses in Toronto, saying it would be positive for the city.

I've talked lots of people over the past couple years who have wanted to build them for themselves to downsize and retire in," he said.

It can be really challenging to age in place in the communities that they're in right now and downsize at the same time. It's also helpful for multi-generational families, I've heard of a number of examples of people who built a suite for their kids to live in, or they expect they'll move into the suite and their kids will move into the main house."

For Teitelman, the severance process was time consuming and costly as he had to hire lawyers, consultants and planners to help make his case.

It was a really concerted effort, which I guess paid off, but it was really expensive, and I wouldn't try to do it again," he said.

Ben Cohen is a Toronto-based staff reporter for the Star. Follow him on Twitter: @bcohenn