New Brunswick’s population has surpassed 820,000. This is the highest population growth rate that our province has experienced since 1976. The influx of people moving to New Brunswick has created a high demand for housing throughout our province. As a result, there is a supply and demand issue in the rental market, resulting in increased rents and low rental vacancy rates.

As part of a province-wide approach to address housing, we are introducing the Housing Development Incentive Program to encourage the development of new rental units. Increasing the supply of rental units will help reduce pressures on the rental market and decrease costs that would normally be passed on to tenants.

Amendments to the Assessment Act include placing phased-in assessment values on newly constructed apartment buildings with two or more units and existing buildings being refurbished to add more rental units. The program will phase-in, over three years, the Real and True value for qualifying real property (or portion(s) of qualifying real property) at 33 per cent in the first year, 66 per cent in the second year and 100 per cent in year three.

The online application form as well as eligibility criteria can be found here.

This permanent program is available beginning in 2022.

Property Assessment Services is mandated to assess all real property at its Real and True value as of January 1 of the taxation year.

Property assessors will work with eligible property owners in gathering information to determine a fair market value using industry best practice.

The property must be an existing property, such as a school, that is being refurbished to add more rental units, with construction costs of 20 per cent of the current assessed value, before the renovation begins.

Existing apartment buildings adding more units may also qualify.

To qualify, a building permit must be issued on or after January 1, 2022, with construction beginning no later than December 31 in the year the permit was issued.

Qualifying properties need to meet the following eligibility criteria:

• The property must be non-owner-occupied and include at least two rental units (newly constructed or existing).
• Construction costs for existing buildings being converted into multi-unit buildings or are adding units must equal at least 20 per cent of the property’s assessed value before work begins.
• Vacant multi-unit buildings being restored must have been vacant for at least two years.
• A building permit must be issued on or after Jan. 1, 2022, with construction beginning no later than Dec. 31 of the year the permit was issued.

The online application form as well as eligibility criteria can be found here.

Property assessors will monitor the properties in this program. Any change of use to a property will result in the eligibility being reviewed to determine if the property continues to benefit from the phased-in assessment.

The program will phase-in, over three years, the Real and True value for qualifying real property (or portion(s) of qualifying real property) at 33 per cent in the first year, 66 per cent in the second year and 100 per cent in year three.

The values for these buildings will be added to the overall tax base that is provided to local governments and rural districts that is used to calculate what tax rate they need to set to cover their spending for the following year.