Nova Scotia lowers required down payment for first-time homeowners

CITYnews halifax / By Mark Hodgins

The provincial government says a newly-announced program is addressing one of the barriers to home ownership: saving for a down payment.

The First-time Homebuyers Program, unveiled on Tuesday by Housing Minister John White, allows eligible homeowners to make a down payment of 2 per cent on their first home. Eligible house prices for the program are $570,000 or less in the Halifax Regional Municipality and East Hants, and $500,000 or less elsewhere in Nova Scotia.

Typically, down payments are 5 per cent on houses of half a million dollars and 10 per cent on the remaining.

“Nova Scotians told us that in today’s rental market, they are struggling to save the down payment to buy a new home,” White said. “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 minister says the program is being delivered as a partnership with Atlantic Central and credit unions across Nova Scotia.

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To be eligible, borrowers need to meet certain criteria, including having a household income of $200,000 or less, pass the CMHC mortgage stress test, have a credit score above 630, and be a Canadian citizen, permanent resident or an immigrant with a sponsorship letter from the Nova Scotia provincial immigration program.

The program sees the province act as a “guarantor” for mortgages, so if a buyer defaults and the lender resells the home, the government will cover 90 per cent of the shortfall.

“This partnership with the Province of Nova Scotia reflects a shared recognition across the credit union system that there is a growing group of people who are capable, responsible and ready for homeownership, but who need the right support to take that next step,” Paul Masterson, President and CEO, Atlantic Central and League Savings and Mortgage, said in the release.

The official opposition New Democrats say the program is “better late than never” and is something Nova Scotians could have used five years ago.

“The reality is that after five years of this PC government, it’s harder than ever for families to buy a first home,” NDP leader Claudia Chender said in a statement. “The Houston government needs to get serious about keeping young people here by building many more homes that people and families can actually afford and protecting renters so they can stay in their homes. Our focus remains on putting home ownership within reach again for more Nova Scotians.”

Halifax home prices expected to tick higher in 2026

Royal LePage is forecasting an uptick in home prices for 2026 as it says the Canadian housing market is primed for a “reset” with more buyers making their move.

Halifax home prices are expected to rise no more than two per cent in 2026. Prices are forecast to rise to 538,968 year over year, according to the report. The median price of a detached property will see the largest increase, at 4 per cent to $628,056.

Royal LePage president and CEO Phil Soper said the combination of lower borrowing costs, increased supply and reduced competition has created a more favourable environment for buyers.

Under the First-time Homebuyers Program, the required down payment is two per cent of the purchase price, less than half the usual minimum. (Province of Nova Scotia / File)

“Employment was high, interest rates were expected to continue falling, savings were high. So we had predicted a robust recovery, and then Trump 2.0 came along,” said Soper, adding the firm didn’t anticipate the “scale and scope” of the U.S. president’s rhetoric, nor how “aggressive” his trade policy would be.

Ultimately, buyers were spooked.

“First-time homebuyers in particular were set back,” he said.

“People were freaked out by the rhetoric coming out of the American president’s mouth and official American policy. It just set them back on their heels. Confidence plummeted.”