Trying to break into Canada's red-hot housing market is not for the weak of stomach or the light of bank account.

For millennials, that's meant shifting ideas and values about what home looks like.

"You look at the typical suburban home. There's so much redundant space. And then it's like, what do you put in there? You've gotta go find junk to put in there or it just feels empty," says Mark Erickson, co-creative director at Studio North, a Calgary architecture firm.

Rendering of Calgary laneway house by Studio North Architects

This is a rendering of the Calgary laneway house Studio North architects Mark Erickson and Matthew Kennedy will build and move into as roommates. (Studio North )

The 31-year-old and his team are toying with some big ideas about smarter, smaller ways to live. That means eyeing the city's network of alleyways as an untapped housing source.

"I think laneway housing really opens up possibilities for our generation to actually afford to live inner city with all the amenities and have your own, sort of a little house that's really about compact living and simple living."

Dwellings that face into alleys and typically sit behind a main house are known by several names: laneway houses, granny or garden suites, garage apartments and coach houses.

In large Canadian cities where the urban landscape has become increasingly dominated by tiny condos and pricey, single-family homes, an alternative choice sounds like a no-brainer.

But laneway houses are not universally embraced by civic governments and neighbourhoods across Canada due to fears of increased density, lack of parking, and general distrust of the concept. Not to mention more practical concerns about a municipality's ability to properly service the dwellings with water and sewer lines, remove trash or fit emergency vehicles down narrow alleys.

As such, there's a patchwork of regulations across the country that reflect the relative dearth of laneway houses in Canada.

Vancouver, however, stands out as an aspirational example.

Ditching the garage for grandma

Vancouver's Smallworks is one of the design-build firms benefiting from the popularity of laneway housing, which has been legal in the city since 2009.  

Founder Jake Fry and his team specialize in custom, in-fill properties in the 400- to 1,200-square-feet range.

Smallworks laneway house in Greater Vancouver

This is another laneway development by Smallworks in Greater Vancouver. (Smallworks)

"What we've created with the laneway house is somewhat of a de facto starter home."

Eighty per cent of Smallworks customers have a family relationship with the principal homeowner, says Fry. Typically they're adult children who can't afford a single family home in Greater Vancouver, where the average price of a detached home is more than $1.4 million.

But the possibilities extend beyond helping young people get into the housing market.

Accessible, single-storey homes in the backyard, just steps from family, could serve as the perfect space for aging family members, according to Smallworks.

"If five people got together and built laneway homes for their parents, basically you could hire a full-time nursing service," says Fry, picturing a neighbourhood network where 24-hour nurses could shuttle between homes.

"You could have one or two people on staff between five homes and it would be less expensive per person than a medium-range housing facility."

Small footprint, big hurdles

In Toronto, the city's zoning bylaw officially refers to a laneway home as "a house behind a house."

Unofficially, though, "The policy framework around laneway houses says that the city doesn't want them, " says Meg Graham, one of the principals at the award-winning Toronto architecture firm Superkul.

Where laneway houses do exist in Toronto, Graham says they are typically "grandfathered" in as structures that essentially pre-existed current regulations.

"They can't say you have no right to exist, so you can redevelop them."

That's what Superkul did with the one laneway house it completed, basically rebuilding the former blacksmith's shop in its place. 

Superkul principal architects, Meg Graham and Andre D'Elia

Meg Graham, left, and Andre D'Elia are the principal architects at Toronto firm Superkul. (Ruth Maria Murphy)

Graham, who also sits on the City of Toronto's design review council, says the city was extremely helpful and excited about her firm's project. It didn't hurt that electrical and water service were already running to the house.

She admits the city can be less supportive, faced with the prospect of paying to extend water and sewer lines to the back of established properties. So homeowners foot the bill themselves. 

Graham concedes that just because laneway houses are compact doesn't mean they're low-cost. Still, she says she would focus on the time it takes to complete one, rather than the dollar figure.

Toronto laneway house by Superkul; credit; Tom Arban Photography

In previous lives, this Toronto laneway house by Superkul was a blacksmith's shop and an art studio. (Tom Arban Photography)

"I certainly don't want to discourage anybody, but you have to be realistic, and by realistic I mean there are a lot of folks involved in getting these things done and they certainly aren't things that can happen under the radar."

There comes a time when living in the basement of your parents' house is no longer befitting two up-and-coming architects.

"We have our own laneway house that we're developing ourselves," says Studio North's Erickson.

He and Matthew Kennedy, his business partner, have purchased a small Calgary heritage home that they'll restore and rent to tenants.

Behind that house, they'll build and move into a laneway dwelling of their own design, as roommates. It will serve as a bit of a show home for Studio North and a test case for Calgary.

A pilot project gauging the viability of laneway dwellings in Calgary is still in the early stages, and the city is documenting the architects' entire project, from navigating the permit process to dealing with the neighbours.

Erickson hopes the idea of living more sustainably and a little off the beaten path will catch on.

In Toronto, Graham is hoping for the same, 

"I would love to think that down the road it would become something that's more acceptable...but, God knows."

Studio North architects Mark Erickson and Matthew Kennedy; Calgary

Mark Erickson (L) and Matthew Kennedy (R) stand in front of the Calgary home they're renovating. The Studio North architects will build a laneway house behind the main structure where the business partners will live. (Studio North )