Ontario New Home HST Relief
**Update: Royal Assent was finalized for this Bill as of May 12th, 2026, and administrative processes were confirmed in June!
Between April 1st 2026 and March 31 2027, Agreements of Purchase and Sale signed on new builds are eligible for HST relief within certain parameters.
For new builds valued up to 1 Million or less, the full HST is removed, however new builds sold over 1 Million and up to 1.5M are capped at $130,000 HST relief, with further declining relief rates up to 1.85M sale prices capping off at $24,000 in relief.
Why?
To bolster new home sales. We saw sluggish activity with new builds over recent years with increased costs incurred to builders with rising inflation, and our provincial government has recognized we need more homes on the market to account for the housing supply demand.
As we’ve also seen a fall off in homeownership, this relief boosts affordability and opportunity.
While to-be-built properties and spec homes are selling under the provincial announcement of new HST relief measures, buyers and builders are waiting on official finalization of the measure’s logistics in tandem with CRA before rebates can be applied for at this time.
Some buyers are opting for longer closings while the application process is being finalized, others are paying the full HST upfront now and planning to apply for the rebate applications open.
Given new constructions builds take several months to complete before a move-in day is possible, these types of agreements are happening more easily and readily. Spec homes however require longer closings than anticipated unless buyers are willing to pay HST upfront to close sooner and apply for the rebate later.
This HST relief incentive is built upon the 2025 First Time Home Buyers rebate which has now expanded to all Buyers, not just first time.
The rebate is not applicable for investment property purchases.
The rebate does apply also for “Substantially Renovated” homes however those applications will require more documentation and scrutiny than a standard new build.
A ripple effect of the increased purchasing power for buyers with new builds has been a readjustment in resale, where resale properties no longer hold the same value while a brand new build has been brought down between tens of thousands up to $130,000 in market value.
Resale sellers have had to sharpen their pricing in an already quiter market while already cautious and calculating buyers have more options.
Even with processes still underway, it’s a good time to make something your own & become a new home’s first owner!
You can find more information at https://news.ontario.ca/en/release/1007402/ontario-introducing-legislation-to-support-implementation-of-hst-relief-on-new-homes.
