Apply for funding to build a secondary or backyard suite on your property: Secondary and Backyard Suite Incentive Program

The Secondary and Backyard Suite Incentive Program helps homeowners create supportive housing for family members or affordable housing for tenants on their property. Homeowners can apply for a forgivable loan to build a secondary or backyard suite on the property of their principal residence. You can apply anytime.

Use the Secondary and Backyard Suite Incentive Program Application Form to apply for a loan to help build a secondary or backyard suite on the property of your principal residence.

You need to use the funding to build a secondary or backyard suite for family members or to provide affordable housing. A basement apartment and an apartment detached from your primary residence are examples of a secondary suite.

Funding amount

Funding is available for up to 50% of eligible project costs, to a maximum of $40,000. The applicant needs to have equity or be approved for financing to cover the total cost of the project (applicant covers all project costs in advance).

The funding provides a forgivable loan. Terms of up to 5 years are available. Funding for more than 1 secondary or backyard suite may be available if allowed by the municipality.

Eligible projects

Eligible projects need to provide secondary or backyard suites that:

are on the homeowner’s principal residence or property
meet all municipal requirements (make sure that your municipality allows secondary or backyard suites; they may also be called accessory dwelling units or another name)
are fully self contained (it has its own entrance, kitchen, bathroom, bedroom and living space)
can be completed within 9 months of receiving approval under this program

Eligible costs

Eligible costs include:

labour and materials
design fees
purchase and placement of a prefabricated backyard suite on the property
related taxes, legal fees and other costs associated with applying for the funding and building the suite
a portion of the costs of areas (like laundry facilities that are shared between the homeowner and tenant)
refrigerator and stove

Ineligible costs include:

work completed before you’re approved for the funding
costs that are more than the loan maximum ($40,000)
work done to bring the house or property up to a minimum safety standard (electrical, plumbing, heating or structural repairs not associated with the construction of the suite)
labour performed by the homeowner, occupant of the home or future tenant
extensions not related to the suite, renovations or repairs to the principal residence
secondary or backyard suite that’s being added to a home currently under construction

Eligibility

You can apply for the loan if:

you’re the registered owner of the property
you live at the property as your principal residence (for at least 6 months of the year)
your municipal residential property taxes are paid in full
you’re a resident of Nova Scotia (and a Canadian Citizen or hold Permanent Resident status)
you have money available to pay for the construction of the suite up front

You also need to meet any additional eligibility criteria (like suite and property eligibility and tenant eligibility) and rental requirements outlined in the Secondary and Backyard Suite Incentive Program Guide.

If you received a loan through the Down Payment Assistance Program, you can apply to the Secondary and Backyard Suite Incentive Program after you own and live in your home for 1 year (12 months in a row). You also need to meet all other eligibility criteria for the Secondary and Backyard Suite Incentive Program.

To have the loan forgiven, the tenant and the homeowner must meet 1 of the following situations where the tenant is:

a family member who is 65 or older or a person living with a disability (supportive housing stream)
a family member and the homeowner is 65 or older or a person living with a disability (supportive housing stream)
an individual or household whose income is below income limits and to whom the unit will be rented below average market rates (affordable housing stream)

A family member may be a mother, father, daughter, son, sibling, uncle, aunt, niece, nephew or adult grandchild or similar related by marriage (like a stepmother).

How to apply

Review detailed eligibility and program criteria in the Secondary and Backyard Suite Incentive Program Guide.
Apply online for the funding.
Check the application for details on all required supporting documents.
Submit your completed application and supporting documents.

How long it takes

It should take 6 to 8 weeks for the Secondary and Backyard Suite Incentive Program to review your application and let you know if your loan is conditionally approved. It can take longer if more information is needed or if your application doesn’t include all the required information.

Cost

There is no cost to apply for the funding, but you need show that you have equity or are approved for financing to cover the total cost of the project.

Before you start

Make sure you:

check with your municipality to confirm the building permit process
review eligibility, program criteria and household income limits in the Secondary and Backyard Suite Incentive Program Guide
know if your tenant and the homeowner situation is part of the supportive housing stream or affordable housing stream (see the Secondary and Backyard Suite Incentive Program Guide)
have ID (like a driver’s licence) for all homeowners on the deed
have confirmation that you have financing to fund the construction of the suite (like a bank statement, loan agreement or investment statement)
have your tenant’s ID (like a driver’s licence), if you’re applying as part of the supportive housing stream and your tenant is a family member
have your Permanent Residence card, if applicable

Apply online

When you apply online you need an email address. The Secondary and Backyard Suite Incentive Program emails you if it needs more information to process your application. You need to upload any supporting documents in PDF, DOC, DOCX, JPG, JPEG, PNG, XLS or XLSX format. You can upload up to 10 documents during the application process (you may need to upload additional supporting documents after you complete the application).

Start now

Other ways to apply

You can use the Secondary and Backyard Suite Incentive Program Application (PDF 208 kB) if you’re unable to apply online. Send your completed application and supporting documents by mail. Or visit a regional housing office.