Unlocking Affordable Housing: Newfoundland and Labrador's Secondary and Basement Suite Incentive Program

Housing affordability is a growing concern across Canada, and the government of Newfoundland and Labrador is taking proactive steps to address this issue. The Newfoundland and Labrador Housing Corporation (NLHC) has introduced the Secondary and Basement Suite Incentive Program, a forward-thinking initiative designed to increase the availability of affordable housing options in the province.

What is the Secondary and Basement Suite Incentive Program?

The program is a strategic component of the Provincial Government's Five-Point Plan to make housing more affordable for Newfoundlanders and Labradorians. It encourages homeowners to create new, self-contained secondary or basement suites within their homes by offering a forgivable loan of up to 50% of the renovation costs, capped at $40,000.

How Does the Program Work? Click here for the Fact Sheet

To be eligible, homeowners must rent out the newly created unit at below-market rates for a minimum of five years. The rental rates are established by NLHC, based on annual rental market reports published by Canada Mortgage and Housing Corporation. The program is open to Canadian citizens or permanent residents who reside in the home as their primary residence.

The following rates are applicable as of January 2023:

The Forgivable Loan

The loan is registered on the title of the homeowner's primary residence and is amortized over five years. Each year, 20% of the loan (up to $8,000) is forgiven, provided the homeowner complies with the terms of the operating agreement. This includes renting the unit to eligible tenants and maintaining the property as their principal residence.

Eligible Costs

The program covers various costs directly related to the creation of the secondary or basement suite, including:

  • Architectural and design fees
  • Inspection fees
  • Structural modifications
  • Electrical work
  • Fixtures
  • Appliances (up to a specified limit)
  • Building and trade permit fees
  • Contractor labor (excluding work done by the homeowner)

However, it does not cover the repair of existing rental units, labor costs for work completed by the homeowner, or landscaping costs.

Application Process: Click here for the Form

Applications are now open and will be approved on a first-come, first-served basis until the $4 million budget is fully allocated. Homeowners interested in applying can find more information and the application form on the NLHC website.

The Impact

This program is expected to support the creation of upwards of 100 new basement apartments or secondary suites. It's a win-win situation, providing homeowners with financial assistance to develop their properties while increasing the stock of affordable rental units.


The Secondary and Basement Suite Incentive Program is a testament to Newfoundland and Labrador's commitment to finding creative solutions to the housing affordability crisis. By supporting homeowners in the development of affordable rental units, the province is taking a significant step towards ensuring that all residents have access to comfortable and reasonably priced homes.

For more information on the program, eligibility criteria, and the application process, visit the Newfoundland and Labrador Housing Corporation's website.

Click here for the FAQ Sheet.

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