Programs vary slightly by province

The Nova Scotia Down Payment Assistance Program launched on May 1, 2017, already distinguishes between urban and rural home prices. Under the program, which runs until March 31, 2019, the maximum purchase price for a home in the Halifax Regional Municipality is $280,000, and elsewhere in Nova Scotia is $150,000. This translates into loans to cover the five-per-cent down payment at $14,000 for the HRM and $7,500 elsewhere. Since launching, the program has helped 153 firsttime home buyers.

Many of the program features are similar to P.E.I. The differences are a lower total household income requirement of less than $75,000 and applicants are required to be Nova Scotia residents for 12 months. The P.E.I. program only requires applicants to be Canadian citizens, but the property must be located on P.E.I.

According to a spokesperson with the Department of Community Services, the Nova Scotia home price benchmarks are based on 2016 MLS data for average home prices in the province.

But an important similarity between the P.E.I. and Nova Scotia programs is the finer details with respect to the interest-free aspect of the loans.

Under the P.E.I. program, the loan is interest free so long as the borrower doesn’t default on a payment. Over the course of the loan, five-percent annual interest is applied to the principal of each monthly payment. If the borrower makes all the payments in full and doesn’t default, the interest is forgiven. If a default occurs, the principal and interest are due in full.

Nova Scotia will also apply interest on the interest-free loan if the terms of the loan are breached during repayment.

As well, both programs allow participants to waive their payments in the first year of the loan to accommodate for any unforeseen costs with home ownership.

Newfoundland and Labrador replaced its Down Payment Assistance Program in 2018 with a new home purchase program and a similar First-time Homebuyers Program. The new home purchase program offers grants of $3,000 to go toward a down payment on new homes valued under $400,000 (including HST) while the First-time Homebuyers Program provides participants with five-per-cent of a home with a maximum purchase price of $250,000. The five per cent is comprised of a $2,000 grant and the remainder is a repayable loan.