Find The Best Mortgage Rates In Nova Scotia

Your Guide To Getting The Best Mortgage Rates In Nova Scotia

At comparemortgages.ca, we understand that securing a mortgage can be a big task, so our goal is to make the process as stress-free and straightforward as possible. Our team of experienced financial professionals are available to assist you in any market condition and will guide you through the process from start to finish. With access to hundreds of financial institutions and banks across Canada, we guarantee that you can always access the best rates Nova Scotia has to offer – no hidden fees and no surprises! Plus, with our easy-to-navigate website, looking for mortgaging options has never been simpler!

About Nova Scotia

In the ranking, Nova Scotia comes in as Canada’s seventh-largest province in terms of population and also ranks as Canada’s seventh-largest industrial contributor to GDP. The city boasts a good number of affordable homes, aesthetically pleasing beaches, and a generally friendly culture that is characteristic of the East Coast. As a result, the province has one of the most notable secondary-home mortgage markets in the country. 

Key Facts About Nova Scotia:

• Nova Scotia is home to over 1 million people, with approximately half the population residing in the Halifax-Dartmouth region in terms of regional classification. The largest cities in the province are Halifax, Truro, and Sydney. A large majority of the province is still undeveloped and unpopulated. 
• Nova Scotia has a 61% participation rate in the labour market and a 6.1% unemployment rate, and its GDP comes in at in excess of $50 billion. 
• The average home price in Nova Scotia is only slightly above $360K, with the actual range going from $200K in specific Northern Nova Scotia communities to an excess of $450K in the region of Halifax. 
• The gross household income range in Nova Scotia is around $63K in Queens Regional Municipality and goes up to $87K in Halifax. 
• The average mortgage balance in Nova Scotia is about $213K.

Compare Mortgage Rates in Nova Scotia

Nova Scotia Mortgage Strategy

Fixed rates are typically priced at around 1% to 1.5% over the bond yield. Both long and short-term bond yields are showing any indications of relenting. Big banks have been factoring in risks causing increases in the pricing of shorter-term rates as a result of their popularity rising. We expect that shorter-term rates would remain above expectations and borrowers would move in the direction of shorter-term fixed rates to reduce risk in the event that a renewal or purchase is on the horizon. 

Forecasts by the Bank of Canada (BoC) indicate that at the end of 2024, inflationary pressures will be checked back in place, and at that point, rates will begin to decrease. Given the current situation of this market, it would be a good call to choose a fixed rate over a variable rate. Or opt for a shorter-term fixed rate to beat the market, and then once the inflationary pressures are off, you can renew into a variable rate

First-Time Home Buyer Programs In Nova Scotia

Nova Scotia has various first-time home buyer programs and incentives that have been specifically structured to reduce the financial load of first-time home buyers. These programs would take off some of the costs that homebuyers would incur and help fund a portion of their down payment which is usually a major part of buying a first home.

What Are The Different Types Of Mortgages?

Open vs. Closed Mortgage

An open mortgage allows for the possibility of prepaying any amount of your mortgage at any given time without having to deal with a prepayment penalty. The trade-off for this flexibility that an open mortgage provides is the higher interest rate that follows the mortgage. In essence, you would not get the lowest mortgage rates in Nova Scotia or the best mortgage rates in Nova Scotia.

On the flip side, a closed mortgage has a lower and more attractive interest rate, namely because the flexibility allowed in an open mortgage is missing here. Rather, there is a cap on the extra mortgage payment that you can make per year. So, here, there is a prepayment limit. 

Fixed Mortgages

With the 5-year fixed rate in Nova Scotia, homeowners can rest assured that their interest rate will remain secure throughout the course of the mortgage. This type of fixed-rate mortgage appears to be the go-to option for many Canadian homebuyers; however, this should not be taken as a surefire sign of its effectiveness. A five-year fixed-rate mortgage like the 5-year fixed rate Nova Scotia is an excellent choice for those who prefer comfort in knowing exactly how much their monthly payments are going to stay, as well as individuals who are on a budget and cannot leave room for fluctuating rates. In short, it all boils down to your own personal preferences when it comes to considering any kind of mortgage or borrowing options.

Variable Mortgages

A variable mortgage would see mortgage fluctuations based on the benchmark rate relative to a fixed rate, like the 5-year fixed mortgage rate in Nova Scotia that stays unchanged through the term of the mortgage. Exploring the variable mortgage option is a personal decision and depends on how much risk a borrower is ready to take—speaking with a mortgage professional to review any material risks that could be a source of concern at some point during the mortgage term is recommended. 

Nova Scotia Deed Transfer Taxes

The majority of fees and taxes are decided at a provincial level. In addition to the property purchase price, non-resident buyers in Nova Scotia must also part with Provincial Deed Transfer Tax (PDTT).

Several exemptions are available to this tax, including assuming residence of the province in 6 months following when the deed is transferred to your name. 

Provincial (Non-Resident) Deed Transfer Tax (PDTT)

The Provincial Deed Transfer Tax (PDTT) applies to all sale and purchase agreements and specific transfers after 1 April 2022. 

The PDTT is also applicable to all residential properties and property portions that are regarded as residential with 3 or fewer dwelling units alongside vacant land that falls under the residential category. 

The PDTT is a standard 5% tax levied on the property’s assessed value or the purchase price (depending on which one is greater). 

The PDTT applies to properties classified as residential with 3 or fewer dwelling units and is transferred to 1 or more owners, whereby non-residents of Nova Scotia have over 50% ownership rate. 

If residents of Nova Scotia hold a property ownership interest of 50% or more in the property, the PDTT doesn’t apply. 

For instance, if there 2 siblings (1 resident and 1 non-resident) purchase a residential property, with each sibling having a 50% stake in the property, PDTT would not apply in this scenario.

Ownership Interest In The Property 

A property with multiple owners would have the interest of each owner determined by whether they are regarded tenants in common or joint tenants: 

• Tenants in common would have their property interests stated on the property’s title document (e.g. deed) or parcel register (under the Land Registration Act). If the records do not carry any interest, equal interests would be applied. 
• Joint tenants have equal vested interests in a property. 

The total ownership interest vested in a property must not exceed 100%. 

Municipal Deed Transfer Tax 

Alongside the Provincial Deed Transfer Tax (PDTT), Nova Scotia municipalities also require buyers to pay municipal land transfer taxes, referred to as the Municipal Deed Transfer Tax (MDTT), to the province after purchasing land or residential property. 

Each municipality sets the Municipal Deed Transfer Tax rate, and the MDTT to be paid is determined based on the property’s sales price. The Land Registration Offices that are in charge of recording and registering the deed collect the Municipal Deed Transfer Taxes (MDTT) on behalf of the municipalities. 

Each Municipality sets its own Municipal Deed Transfer Tax (MDTT) Rates, updated when the Municipalities inform the province about any rate change. The rates on the list are usually the most recent. However, the municipalities change rates at their discretion and do not necessarily have to be reported to Service Nova Scotia. To confirm the most recent rates, it is important to check in with the Municipality before proceeding with a transaction. Municipal Deed Transfer Tax Rates 

What Affects My Mortgage Rate In Nova Scotia?

Various factors all play a role in determining your mortgage pricing. They include income, credit score, the purpose of the loan, and down payment. 

Variations in mortgage rates in Canada can result from various factors, including the borrower’s income capacity to service the debt, the borrower’s credit, and the borrower’s capital in the form of savings/investments and down payment conditions. Conditions such as the loan-to-value (LTV) ratio and the purpose of the loan are the two most significant determining factors for mortgage rates in Nova Scotia. The rate depends on the risk associated with the borrower, the mortgage, and the property. 

Down Payment

How much you make as a down payment determines your loan-to-value (LTV) ratio; your LTV is the paramount factor in mortgage rate pricing following the insured or insurable lending criteria. It also determines whether you would have to pay mortgage default insurance alongside your recurring mortgage payments on your mortgage. For properties that fall under the less than 1 million dollars valuation benchmark, insured and insurance mortgage rate pricing would apply, and the amortization is up to 25 years. In scenarios such as this, there is a lower risk of loss to the lender; as such, they would offer better mortgage rates in Nova Scotia. 

If you make an insured purchase with less than a 20% down payment, you would have to buy insurance on the front end. To help lower your rate, lenders can choose to buy the insurance on the back end to reduce the mortgage default risk if you make a down payment of over 20%. 

If you make a down payment of less than 20% of the property’s value, you must pay mortgage default insurance. 

Amortization Period

Suppose you opt for a more extended amortization period (mortgages with less than 20% down payment have a maximum period of 25 years, while mortgages with down payments of 20% or higher have a maximum period of 30 years). In that case, you pay a lower amount as a mortgage since it is spread out for a longer period. A more extended amortization period features higher interest rates as well. Generally, the longer you take while paying off your mortgage, the more interest you will have to pay.

Property Usage

Purchasing a home you intend to make your primary residence and live in is considered owner-occupied. Similarly, suppose you buy a primary residence with a second legally registered suite. In that case, the property is regarded as an owner-occupied rental, and you would be able to access the best mortgage rates in Nova Scotia by it being a primary residence.

If you were purchasing a property you intend to rent to another, or more appropriately, an investment property, you would be saddled with higher interest rates in Nova Scotia relative to that of your primary residence. This is because lenders rationalize that people prioritize paying the mortgage on their primary residence over a rental property. As a result, lenders tack on some additional risk for rental property rates.

Mortgage Type

Your mortgage rate will depend on the sort of mortgage you choose, such as variable vs. fixed and open vs. closed. Each option is an individual decision based on different conditions.

For example, while comparing open and closed mortgages, it’s crucial to remember that open mortgages are more expensive due to the freedom to pay the loan off at any moment without incurring fees.

While fixed mortgages have historically been more expensive than variable mortgages, such as the 5-year variable rate, some people still prefer the security of knowing their payment would remain the same throughout their mortgage.

Your Credit Score

A credit score of 680 or higher is required for approval by a standard mortgage provider. The maximum credit score is 900, and borrowers with scores over 700 as favoured and will be eligible for the best mortgage rates. For those who have lesser scores, there are still solutions accessible, but in these cases, you should anticipate higher rates and shorter durations. 

How Compare Mortgages Works

Our mortgage advisors are usually rewarded based on customer satisfaction with the service rendered. We’re always available to help you reach your goal of owning a home while guiding you through the uneasy home financing process. 

Generally, mortgage professionals who work with borrowers are aware of the best mortgage rates in Saskatchewan. However, only a few will give you that rate without making it a hassle. Here at Compare Mortgages, we are working to change the industry and its ideologies while providing the best rate upfront.

Learn About Rates & Mortgages In Nova Scotia 

Our Frequently Asked Questions (FAQ) section is here to help you make educated decisions on the best mortgage rates in Nova Scotia every time.