N.S. Pilot Cuts Down Payment for First-Time Homebuyers to 2%
The Nova Scotia government has introduced a groundbreaking initiative aimed at assisting first-time homebuyers. Following the announcement made by Housing Minister John White, the province will reduce the minimum down payment required for these buyers from five percent to just two percent.
N.S. Pilot for First-Time Homebuyers
The new First-Time Homebuyers Program is a four-year pilot designed to alleviate barriers for individuals looking to enter the housing market. Under this initiative, the provincial government will guarantee mortgages facilitated by participating credit unions.
Key Program Details
- Down Payment: Reduced to 2% for qualifying first-time buyers.
- Income Cap: Households must earn $200,000 or less.
- Credit Score Requirement: A minimum score of 630 is needed.
- Property Value Limits: Up to $570,000 in Halifax and East Hants; $500,000 in the rest of Nova Scotia.
- Interest Rates: Capped at prime plus two percent.
In case of default, the province will cover 90 percent of the lender’s shortfall if the home sells for less than the mortgage balance. This step aims to counteract the decreasing trend in home ownership among younger demographics, as highlighted by Minister White.
Housing Market Context
Statistics Canada reports that new home prices have declined nationwide since peaking in 2022. Between January and October 2025, Toronto saw a 2.8 percent decrease while Vancouver dropped by 1.6 percent. In contrast, Halifax experienced a 4.9 percent increase in new housing prices, amid a growing population. The city’s population reached nearly 545,000 in 2025, marking a 15 percent growth since 2020.
This population surge, however, has led to a housing crisis in Nova Scotia, with insufficient new construction to meet demand. In Halifax, only 190 new dwellings have emerged per 1,000 residents added. The increasing demand has also driven average rents up; as of the third quarter of 2025, renting a two-bedroom apartment in Halifax averaged $1,840.
Addressing the Housing Crunch
Dan Roberts of East Coast Credit Union noted the pressing need for affordable housing solutions. Many renters struggle to save for the traditional five percent down payment. The new program aims to address this challenge, offering hope to potential homeowners.
The provincial strategy aligns with various other initiatives across Canada to support first-time buyers. At the federal level, there are tax-free savings accounts and programs allowing the use of registered retirement savings for home purchases. Additionally, Ottawa is moving forward with legislation to rebate GST on first-time home purchases up to $1 million.
As municipalities across the country adopt their own measures, the spotlight remains on Nova Scotia’s proactive approach. With innovative solutions, the government hopes to reinvigorate homeownership opportunities and alleviate the pressures faced by first-time buyers.
