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Published February 15, 2024

The Best Mortgage Rates in Nova Scotia

Compare fixed and variable mortgage rates from Nova Scotia’s best bank and alternative lenders.

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Nerdy Tip: The best mortgage rates in Nova Scotia are a little better in February than they were in January, but rising government bond yields could lead to higher fixed mortgage rates in the coming weeks. Variable mortgage rates in Nova Scotia won’t fall until the Bank of Canada reduces its overnight rate. That may not happen until June. 

The best fixed and variable mortgage rates in Nova Scotia

Rates updated: January 10, 2024

Mortgage Type

Purchase Price

Down Payment

Province

Term

Fixed

Variable

1-Year

Rate

6.79%

Est. payment

: $3,120.00/mo

B2B

:
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3-Year

Rate

5.24%

Est. payment

: $2,694.00/mo

Manulife Financial

:
EXPLORE NOW

Rate

6.30%

Est. payment

: $2,982.00/mo

Radius Financial

:
EXPLORE NOW
4-Year

Rate

5.04%

Est. payment

: $2,641.00/mo

RFA

:
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5-Year

Rate

5.04%

Est. payment

: $2,641.00/mo

First National

:
EXPLORE NOW

Rate

6.10%

Est. payment

: $2,927.00/mo

Equitable Bank

:
EXPLORE NOW

Disclaimer: These rates do not include taxes, fees, and insurance. Your actual rate and loan terms will be determined by the partner’s assessment of your creditworthiness and other factors. Any potential savings figures are estimates based on the information provided by you and our advertising partners. Mortgage Brokerage Licensed in ON #12984, BC #X301004, MB and AB. Homewise can pursue mortgage brokering activity in SK, NL, NS and NB.

Data source:

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Nova Scotia mortgage rate update: February 2024

Toward the end of January, mortgage rates finally dipped in response to falling three- and five-year government bond yields. Generally, this kind of action in the bond market would lead to faster reductions in three- and five-year fixed mortgage rates, but lenders don’t usually rush to serve up bargains.

As of February 12, 2024, lenders were offering five-year fixed rates below 4.8% on certain mortgage products, while three-year fixed mortgage rates were available for around 5%.

Five-year terms being a more affordable option puts Nova Scotia mortgage shoppers in a bind: A five-year term isn’t overly attractive if rates are expected decline significantly by 2025 or 2026, but it may be easier to qualify for once the stress test is factored in.

According to the Bank of Canada, the average posted rate for a one-year, fixed-rate mortgage was an eye-watering 7.84% as of February 7. At an average posted rate of 6.99%, three-year fixed mortgage rates might be more affordable, but they require borrowers to pass the stress test at a brutal 8.99%. 

Don’t let your bank’s posted rates make you hyperventilate, though. They’re meant to be negotiated down, and should be closer to the rates found on the table above.

Variable mortgage rates remain elevated after the Bank of Canada held its overnight rate at 5% on January 24. The Bank’s rate hikes have likely come to an end, but the overnight rate, and variable mortgage rates, won’t be reduced until inflation is firmly under control and heading toward the Bank’s target of 2%. That may not occur until June 2024.

The average mortgage rate in Nova Scotia

There’s not much value in calculating the average mortgage rate in Nova Scotia since it would include every mortgage type and term length from every lender, including the above-average rates associated with open mortgages and private mortgages. 

The only rates that matter are the ones attached to the mortgage you hope to be approved for. If you’re interested in a variable-rate mortgage, for example, compare variable mortgage rates. If you’re looking for more stability, compare fixed rates according to term length. Specific comparisons like these will give you more relevant information to work with. 

Your mortgage rate will ultimately be determined by your finances, so it doesn’t really matter what other people are paying. 

Historical trend: New mortgage loans in Nova Scotia

Forecasting Nova Scotia mortgage rates

Variable Mortgage Rates

Variable mortgage rates are expected to finally begin decreasing in the first half of 2024. When they decline, and by how much, depends on the Bank of Canada’s overnight rate.

When inflation is running hot, the Bank raises the overnight rate to increase borrowing costs and cool the economy. Whenever the overnight rate increases, variable mortgage rates rise to the same degree.

If inflation trends closer to the Bank’s target rate of 2% in the first few months of 2024, it may feel confident lowering the overnight rate as soon as April. When the overnight rate falls, variable mortgage rates will soon follow.

Fixed Mortgage Rates

Because they’re driven by lenders’ interpretations of activity in the government bond market, fixed mortgage rates can be difficult to predict over the long-term.

Based on bond activity in the fourth quarter of 2023, for example, lenders could have dropped their three- and five-year fixed mortgage rates moderately in January, but there weren’t many bargains on offer at the time of this writing.

Fixed mortgage rates could be somewhat lower by the end of 2024, but it’s unlikely that they’ll fall significantly below 5%. 

Mortgage calculators to inform your home buying decisions

Mortgage payment calculator ↗

Estimate your monthly mortgage payments.

Mortgage affordability calculator ↗

Estimate how much house you can afford.

Mortgage closing costs calculator ↗

Create a home buying budget by estimating your closing costs.

Nova Scotia housing market update: February 2024

The Nova Scotia housing market started 2024 on a relative down note. While sales in January were up 8.8% year-over-year, they were 17% below the five-year average for the month. 

The supply situation in Nova Scotia improved somewhat in January, with new listings coming in 30% higher compared to the same period a year ago. Both new and active listings were below the 10-year average for the month, which contributed to the average sale price in the province ($428,539) rising 13% year-over-year.

Nova Scotia home sales and price forecast

According to the Canadian Real Estate Association (CREA), Nova Scotia might experience one of the strongest real estate rebounds of any Canadian province in 2024. 

CREA expects home sales to increase 10.4% — by about 1,000 transactions — compared to 2023. Nova Scotia and Ontario are the only two provinces where sales are forecast to rise by more than 10%. 

Price growth may not be as robust. CREA expects the average sale price in the province to increase by 2% versus 2023. That would result in an average price of just over $427,424.

Nova Scotia first-time home buyer programs

There are two provincial programs available to help buyers cope with the challenges of buying a first home in Nova Scotia, including:

Federal assistance programs include the Home Buyers’ Plan, First-Time Home Buyer Incentive and the First Home Savings Account. Some of these tools can be combined, so it might be worth investigating all of them to see which ones fit your goals and finances.

Land transfer taxes in Nova Scotia

If you’re a Nova Scotia resident buying a home in the province, you’ll be charged a municipal deed transfer tax. The tax rate depends on the municipality where the property is located. As of January 2024, the rate ranged from 0.5% to 1.5% of a home’s purchase price.

Non-residents who purchase residential properties containing three units or less are charged a non-resident deed transfer tax worth 5% of either the home’s purchase price or assessed value, whichever is greater.

Guide to Nova Scotia mortgage rates

Types of lenders in Nova Scotia

Mortgage lenders in Nova Scotia tend to fall into four categories, which include:

Types of mortgages in Nova Scotia

Fixed-rate mortgages

With a fixed-rate mortgage, the rate stays the same for the duration of the mortgage term, even if rates fluctuate.

Fixed rates provide certainty, which can make them easier to budget around than variable mortgage rates. That certainty comes at a price, though: Outside a few exceptions, fixed rates have historically been higher than variable rates.

Variable-rate mortgages

Variable mortgage rates rise or fall depending on which direction your lender’s prime rate moves. Depending on the state of the economy, a variable rate can increase or decrease multiple times during a mortgage term. 

Variable rates are risky, which is why they’re typically lower than fixed rates. In a high-inflation environment, when lenders’ prime rates are driven upward by increases to the Bank of Canada’s overnight rate, variable mortgage rates can skyrocket. 

» MORE: The difference between fixed- and variable-rate mortgages

Hybrid-rate mortgages

If you take out a hybrid-rate mortgage, a portion of your mortgage is subject to a variable rate and another portion is at a fixed rate of interest. Hybrid mortgages can dampen the impact of fluctuating interest rates in a particularly turbulent economy, but they tend to be more difficult to transfer between lenders.

Insured and uninsured mortgages

If you buy a home for under $1 million, and your down payment is less than 20% of the purchase price, you must purchase mortgage default insurance, which adds to the cost of your loan. In these cases, you’ll be getting an insured mortgage.

If your down payment is greater than 20%, or you’re buying a home where a 20% down payment is required, like an investment property or a home worth $1 million or more, insurance is not required. In this scenario, you’re getting an uninsured mortgage. 

Insured mortgage rates tend to be lower than uninsured mortgage rates. 

Short-term and long-term mortgages 

Short-term mortgages typically last five years or less. Long-term mortgages last over five years. With a shorter term, you’ll need to renew your mortgage sooner, which can provide flexibility, but it can also increase risk if rates are trending upward as your renewal date approaches. 

Closed and open mortgages 

The primary difference between closed and open mortgages is that you can pay off an open mortgage whenever you like and not pay a penalty. If you have a closed mortgage and make additional payments that go beyond your pre-payment allowances, you’ll be penalized for breaking your mortgage.

Closed mortgages often offer better rates than open mortgages. But an open rate mortgage may be a good option if you think you may be able to pay off your mortgage early.

» MORE: Understanding open and closed mortgages

How Nova Scotia lenders determine mortgage rates

The mortgage rate you’re offered by a lender in Nova Scotia will be based on two primary factors; one based on the state of the economy and one based on your financial situation.

Economic factors

Variable mortgage rates are influenced by the Bank of Canada’s overnight rate. When the overnight rate increases or decreases, a lender’s prime rate follows suit. Variable mortgage rates are based on a lender’s prime rate, so as the prime rate rises or falls, so do variable rates. 

Fixed mortgage rates are determined by activity in the government bond market, particularly the yields on one-, three- and five-year bonds. Fixed mortgage rates follow the movement of those yields. 

Your financial situation

Factors specific to you also affect the rates you’re offered. These include:

Lenders look for signs of risk when assessing these aspects of your finances. The riskier they perceive you to be as a borrower, the higher the rate they’re likely to offer you.

How to qualify for a lower mortgage rate in Nova Scotia

Some of the mechanisms that shape rates are beyond your control, but there are steps you can take to convince lenders to offer you the best mortgage rates. For example, you can try:

Factors that affect mortgage affordability in Nova Scotia

A home’s price and the rate you’re offered aren’t the only factors that affect how much mortgage you can afford. You’ll also have to account for the following components, which play a role in all mortgages.

Debt service ratios

Lenders use debt service ratios to determine how much of your income goes toward paying debt. If those ratios are too high, you may not qualify for the mortgage amount you need.

Car loans, credit cards and lines of credit are all examples of debt that require regular payments. Decreasing some of these balances, or relying less heavily on credit, can help you lower your debt service ratios. 

The mortgage stress test

You will have to pass the mortgage stress test if you want a home purchase funded by a federally regulated financial institution.

The rules of the stress test say you must qualify for a mortgage at a minimum qualifying rate of either 5.25% or the rate you’re offered plus 2%, whichever is higher. If a lender offers you a rate of 5%, for example, you’ll have to demonstrate you can afford the same mortgage at 7%.

You may be able to avoid the stress test if you apply for a mortgage with a lender that is not federally regulated, like a credit union.

Your down payment

Your down payment is a critically important factor in determining mortgage affordability. The more you can put down, the less you’ll need to borrow. Your monthly mortgage payment will likely be smaller, and you’ll pay less in interest. 

Mortgage term

The term is the length of time your mortgage contract is valid. In Canada, mortgage terms can run anywhere from six months to as long as 10 years.

Chances are that your mortgage will have multiple terms during the amortization period until you pay it off in full. Once your mortgage term ends, you can pay your loan off in full, renew it or refinance it.

Amortization period

A mortgage’s amortization period is the time it will take to pay off the loan in full. In Canada, the most common amortization period is 25 years. If your down payment is less than 20%, you can’t have an amortization beyond 25 years. 

If your down payment is greater than 20%, you may find some lenders willing to offer amortization periods of up to 35 years.

Why would you want a longer amortization period? The longer your mortgage lasts, the smaller your monthly payment will be. You’ll pay more in interest, but that might be a worthwhile trade-off if it helps you keep your home.

How to compare mortgages from Nova Scotia lenders

Use APR for greater accuracy

The annual percentage rate (APR) includes fees and closing costs the lender may charge in addition to the interest rate. A lender offering the lowest rate may actually have a higher APR due to those additional costs. Comparing APRs is the easiest way to see the complete cost of each offer.

Compare similar mortgages

For a comparison to be useful, the mortgages should have the same term, amortization period and payment frequency. 

When looking for the best mortgage rates in Nova Scotia, also consider:

You can also compare mortgage rates in other provinces to get a sense of how the rate you’ve been offered in Nova Scotia stacks up:

Working with a mortgage calculator can help you compare different mortgages in a single place.

There’s more to mortgage shopping than the interest rate 

Scoring a low mortgage rate might be a home buyer’s prime motivation, but getting the lowest rate doesn’t necessarily mean you’re getting the best mortgage for your needs.

For example, you could opt for a fixed rate, which might cost more than a variable rate, if you’re more comfortable with the certainty that your rate won’t increase during the term.

Or, if you expect to come into a sizable sum of money soon (via an inheritance, for example), paying a higher rate for an open mortgage, which allows you to pay it off early without penalties, could be worth it.

Frequently asked questions about Nova Scotia mortgage rates

What are the current mortgage rates in Nova Scotia?

As of January 8, 2024, some lenders in Nova Scotia were offering five-year fixed mortgage rates slightly below 5%. Three-year fixed mortgage rates were around 5.3%, while five-year variable mortgage rates were around 6%. 

Will Canadian mortgage rates go down in 2024?

Mortgage rates are expected to decrease in 2024. If the Bank of Canada reduces its overnight rate by a full 100 basis points this year, as some analysts expect, variable mortgage rates will fall by 1% before the end of the year. If government bond yields continue declining, fixed mortgage rates should shrink well, but home buyers shouldn’t expect any mind-blowing bargains.

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