N.S. introduces program that reduces down payment for first-time homebuyers to 2 per cent

Nova Scotia is introducing a plan to help first-time homebuyers.

Nova Scotia’s Progressive Conservative government is fulfilling a campaign promise it made ahead of the 2024 election, aimed at making it easier for first-time homebuyers to get into the market.

Provincial Housing Minister John White announced the First-time Homebuyers Program Tuesday morning at the East Coast Credit Union office in Halifax.

Under the new pilot program, eligible first-time homebuyers can pay a down payment of just two per cent of the purchase price of a home – less than half the typical down payment of five per cent for a home up to $500,000.

“Nova Scotians told us that in today’s rental market, they are struggling to save the down payment to buy a new home,” said White. “This program is making it more affordable to come up with a down payment and easier to make the dream of homeownership a reality.”

The incentive applies to homes priced up to $570,000 in the municipalities of Halifax and East Hants and up to $500,000 for a home anywhere else in the province.

The province says borrowers must meet the following criteria:

• be a resident of Nova Scotia
• have a household income of less than $200,000
• pass the Canada and Mortgage and Housing Corp. stress test
• have a credit score of 630 or higher
• be a Canadian citizen, permanent resident, or an immigrant with a sponsorship letter from the Nova Scotia provincial immigration program

Household partners can apply together if they have lived together for at least 12 months or are newlyweds.

Previous homeowners who have not owned a home in the last four years may also be eligible.

Interest rates will be capped at prime plus two per cent.

The province is acting as a guarantor for mortgages through the program. If a buyer defaults and the lender resells the home at a price lower than the outstanding mortgage, the province will cover 90 per cent of the shortfall.

The Nova Scotia government is partnering with Atlantic Central and credit unions across the province to deliver the First-time Homebuyers Program.

Interested homebuyers looking for a mortgage through the program can contact their local participating Credit Union.

For more Nova Scotia news, visit our dedicated provincial page