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 loan to build a secondary or backyard suite on the property of their primary 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 primary 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.
Affordable housing is housing where the rent is below the average market rent (AMR) for the location.
Funding amount
Funding is available for up to 50% of eligible project costs, to a maximum of $40,000. The applicant needs to fund the remaining balance of the project.
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 primary residence or property
- meet all municipal requirements (ensure that your municipality allows secondary or backyard suites - which may also be called accessory dwelling units)
- provides a safe environment for the homeowner and tenants
- is fully self contained – it has its own entrance, kitchen, bathroom, bedroom and living space
primary residence may be a detached house, a semi-detached house, a duplex, or a townhouse that meets health and safety standards.
If your home doesn’t meet health and safety standards, you can apply for help through other housing programs for additional assistance.
Eligible costs
Eligible costs include:
- Labour and materials
- Design fees
- Purchase and placement of a prefabricated backyard suite on the property
- Taxes, legal and other costs associated with the application for and building of the suite
- A portion of the costs of areas, such as laundry facilities, that are shared between the homeowner and tenant
Ineligible costs include:
- Work done prior to approval of your application
- Costs that exceed the loan maximum ($40,000)
- Work done to bring the house or property up to a minimum safety standard
- Homeowner, occupant of the home, or future tenant labour costs
- Extensions not related to the suite, conversions, or repairs to the primary residence
Rental requirements
When the suite is occupied, there needs to be a residential lease agreement between the homeowner (landlord) and the tenant. Once the lease agreement is signed, both the tenant and landlord have rights and responsibilities under the Residential Tenancies Act and regulations.
You need to have a year-to-year or month-to-month lease while there’s still a loan on the suite. Fixed-term leases and short-term rentals (28 days in a row or less) are not allowed while there’s still a loan on the suite.
Your tenant needs to be a resident of Nova Scotia (and a Canadian citizen or holds Permanent Resident status).
Accessing the funding
Once a project is approved, the program provides a Letter of Conditional Approval that outlines the conditions of the loan. The Secondary and Backyard Suite Incentive Program provides 100% of the funding after the work is completed and you get your occupancy permit from the municipality.
Eligibility
You can apply for the loan if you:
- are the registered owner(s) of the property
- live on the property as your primary home
- have up to date property taxes
- are a resident of Nova Scotia (and a Canadian Citizen or hold Permanent Resident status)
- have money available to pay for the construction of the suite up front
To have the loan forgiven, the tenant and the homeowner must meet one of the following situations where the tenant is:
- a family member and is 65 years of age or older OR is a person living with a disability (supportive housing)
- a family member and the homeowner is 65 years of age or older OR a person living with a disability (supportive housing)
- an individual or household whose income is below income limits and to whom the unit will be rented below average market rates (affordable housing)
A family member may be a mother, father, daughter, son, sibling, uncle, aunt, niece, nephew, or adult grandchild or similar related by marriage (i.e., stepmother etc).
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.
How to apply
- Review detailed program criteria in the Secondary and Backyard Suite Incentive Program Guide.
- Complete the application form.
- Check the application for details on all required supporting documents.
- Send your completed application and supporting documents by mail. Or visit a regional housing office.
How long it takes
It should take 3 to 4 weeks for the Secondary and Backyard Suite Incentive Program to review your application and let you know if your loan is 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 have been approved for debt financing to cover the total cost of the project less the loan amount.
Before you start
Make sure you:
- review program criteria and household income limits in the Secondary and Backyard Suite Incentive Program Guide