Most of the news from Canada involving home purchases these past couple of years has involved stories dealing with the skyrocketing prices in major cities which seem to be rising month after month.
For most low and middle income earners, coming up with the required down payment of tens of thousands of dollars and the bank loan costs, put the possibility of home ownership out of reach.
The eastern maritime province of Nova Scotia has just announced a plan called the Down Payment Assistance Programme. (DPAP), It’s designed to help “modest” income earners with access to funds for that all important down payment.
With $1.3 million from the provincial and federal governments, the programme provides interest-free loans of up to five percent of purchase cost to home buyers towards the down payment.
Applicants will have to meet certain conditions;
- -the home must be in the province, and the price must not exceed $280,000 in the Halifax Regional Municipality (HRM), or $150,000 in the rest of the province. That translates roughly into a $14,000 loan in the HRM, or up to $7,500 elsewhere in the province.
- – Participants must have good credit and be pre-approved for an insured mortgage by a recognized financial institution.
- – The applicant is a first-time home buyer
- -The applicant’s total household income is less than $75,000
- -The applicant has resided in Nova Scotia for at least 12 months
- -The purchased property must be the applicant’s principal residence; rental properties, seasonal and recreational properties are not eligible.
Applicants will have ten years to repay the loan and first year payment can be waived to allow buyers to adjust to unforeseen costs.
Jonethan Brigley is the Chair of the Association of Community Organizations for Reform Now (ACORN). He says the programme is a step in the right direction but it may not get many takers.
Quoted by the CBC he said, “”The biggest thing right now is the lack of low-income, affordable houses in general”.
He added that it’s tough for low-income people to find an apartment let buy a house, adding that any home in the price range of those eligible for this programme would be found “in a rural area, off the beaten path, not where Metro Transit (public transit) goes.” That would require purchasing a vehicle and being able to afford gas, not in the budget of many low-income families”.
A quick look at detached homes for sale in Halifax shows few available within the range provided in the DPA Programme.
The pilot programme began this month and provincial officials said it should help between 100 and 125 households.
Additional information- sources
For reasons beyond our control, and for an undetermined period of time, our comment section is now closed. However, our social networks remain open to your contributions.