First-Time Home Buyers Incentives in Nova Scotia
Table of contents
Nova Scotia offers a few incentives to help first-time buyers achieve their homeownership goals. From down payment assistance programs to rebates that can be used with their federal counterpart to reduce taxes on newly built homes, these programs can help with the upfront costs of homeownership.
Key Takeaways
- Nova Scotia’s Down Payment Assistance Program provides an interest-free loan to eligible first-time buyers.
- The First-Time Home Buyers’ Rebate Program offers up to $3,000 back on the provincial portion of the HST paid on newly constructed homes.
- Federal programs like the RRSP Home Buyers’ Plan and the Home Buyers’ Amount can provide further financial assistance to first-time buyers.
Nova Scotia First-Time Home Buyer Incentives
First-time home buyer incentives in Nova Scotia assist with upfront home purchase costs. The Down Payment Assistance Program provides a loan to first-time buyers to help cover the cost of a down payment. Meanwhile, the First-Time Home Buyers Rebate Program provides a rebate on the provincial portion of HST on newly constructed homes.
Down Payment Assistance Program
The Down Payment Assistance Program assists qualifying first-time buyers with an interest-free loan of up to 5% of the home’s purchase price. The loan can only be used for a down payment and must be repaid over 10 years. Properties must be located in Nova Scotia and will be your primary residence when you move in.
To qualify, you must be a Canadian citizen or permanent resident and live in Nova Scotia (defined as at least 183 days each year), be pre-approved for an insured mortgage by an approved lender, have a credit rating of 650 or more and have a total household income of less than $145,000.
First-Time Home Buyers’ Rebate Program
The First-Time Home Buyers’ Rebate Program provides a rebate of up to $3,000 on the provincial portion of the HST paid to buy or build a new home. Unlike the federal GST/HST rebate, the provincial program does not apply to substantially renovated homes.
To be eligible for the rebate, the newly built home must be your primary residence and meet one of the following criteria: either the newly built home will be the first home you’ve owned and occupied in Canada in the last 5 years or will replace a previous home that was involuntarily destroyed in the last 5 years.
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Federal First-Time Home Buyer Programs
In addition to Nova Scotia’s provincial programs, there are several other incentives available at the federal level to help first-time home buyers.
RRSP Home Buyers’ Plan
The Home Buyers’ Plan allows first-time buyers to withdraw up to $60,000 (or $120,000 jointly as a couple) from their Registered Retirement Savings Plan (RRSP) on a tax-free basis to use toward the purchase of a home. The withdrawal acts like a loan with a 2-year grace period where you do not have to repay any amount. However, after the 2-year grace period ends, the amount withdrawn under the plan remains tax-free if repaid in equal installments within 15 years.
Home Buyers’ Amount
The Home buyers’ amount allows you to claim up to $10,000 on your income taxes for a tax rebate of up to $1,500. To be eligible, you must acquire a qualifying home and be considered a first-time homebuyer unless you are a person with a disability.
GST/HST New Housing Rebate
The GST/HST New Housing Rebate provides a rebate on the federal portion of the Goods and Services Tax (GST) or Harmonized Sales Tax (HST) paid when buying a new or substantially renovated home. The rebate amount will depend on the province where the home is located and whether a rebate is available on the provincial and federal portions of taxes.
Frequently Asked Questions (FAQ) on First-Time Home Buyers Incentives in Nova Scotia
How much do first-time home buyers have to put down in Nova Scotia?
The down payment required depends on the home’s purchase price. First-time buyers should expect to put down a minimum of 5% on homes with a purchase price of $500,000 or less. For homes with a purchase price between $500,000 and $1,499,999, 5% is required on the first $500,000 and 10% on the remaining amount. For homes with a purchase price of $1.5 million or more, a 20% down payment is required.
Can any resident qualify as a first-time home buyer in Nova Scotia?
The Down Payment Assistance Program defines first-time buyers as those who have never purchased or had an interest in a home, have gone through a breakdown of marriage or common-law partnership, or have not occupied a home that they or their current spouse/common-law partner have owned in the last 4 years.
Eligibility as a first-time buyer for the First-Time Home Buyers’ Rebate Program is defined as not owning or occupying a home in Canada in the last 5 years or having a home involuntarily destroyed in the last 5 years.
Can any resident qualify for the Down Payment Assistance Program in Nova Scotia?
To qualify as a resident for the Down Payment Assistance Program, you must live in Nova Scotia, which is defined under the program as residing in the province for at least 183 days each year.
Final Thoughts
Buying your first home doesn’t have to come at a substantial financial cost, thanks to the various provincial and federal programs available to first-time buyers in Nova Scotia. From down payment assistance to tax credits, these programs can significantly reduce the financial hurdles that first-time buyers in the province face.
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