Ontario's HST Rebate on New Builds Just Got Bigger — Now Open to ALL Buyers
Previously limited to first-time home buyers, Ontario and the federal government have expanded the HST rebate to all purchasers of new construction homes. Savings of $60,000–$75,000+ are now possible on homes between $500K–$750K. Here's exactly how it works.
Key Takeaway
Starting April 1, 2026, the full 13% HST is being rebated on qualifying new home purchases up to $1 million — for ALL buyers, not just first-timers. Combined federal and Ontario rebates can save you up to $130,000. This one-year incentive (April 2026 – March 2027) makes new construction significantly more attractive than resale properties right now.
What Changed: From First-Time Only to All Buyers
The GST/HST New Housing Rebate has existed for years, but the federal first-time home buyers' GST/HST rebate — which received Royal Assent in March 2026 — was initially designed for first-time purchasers only, offering relief on new homes valued up to $1.5 million.
Then on March 25, 2026, Ontario announced a temporary expansion: a full HST rebate on qualifying new homes for ALL buyers — not just first-time purchasers — for agreements entered between April 1, 2026 and March 31, 2027.
This means whether you're a first-time buyer, move-up buyer, downsizer, or investor purchasing new construction, you can now access significant tax relief.
Official Government References
Canada Revenue Agency — First-Time Home Buyers' GST/HST Rebate
Official CRA announcement (March 17, 2026) on the new federal first-time buyer rebate for homes up to $1.5 million.
Department of Finance Canada — GST Relief Background
Federal backgrounder on the GST relief program for first-time buyers of new homes.
RC4028 — GST/HST New Housing Rebate Guide
Complete CRA guide with rebate eligibility, forms, and calculation instructions.
Ontario Budget 2026 Expansion: On March 25, 2026, Ontario announced a one-year expansion of the provincial HST rebate to all new home buyers (not just first-time). The window runs April 1, 2026 – March 31, 2027. See Ontario's announcement details.
How the Rebate Actually Works
When you purchase a new construction home, the builder's price includes HST (13%). The rebate works in two parts:
Up to $50,000 rebate
36% of the federal GST paid, with enhanced thresholds for new homes up to $1.5M (first-time buyers) or $1M (all buyers under Ontario expansion).
Up to $24,000+ rebate
75% of the provincial portion of the HST, up to a maximum of $24,000 for homes up to $400K, with partial rebates to $1M under the expansion.
Important: How the Credit is Applied
In many cases, only a portion of the rebate is deducted from the purchase price at closing. The builder may credit part of it, but the remaining balance must be applied for separately through your lawyer using CRA Form GST190 and the Ontario Schedule RC7190-ON. Your real estate lawyer handles the application — ensure they are experienced with HST rebate filings.
⚠️ Buyer Beware: Not All Builders Are Passing Down the Full Savings
Since the rebate expansion was announced, we have seen some builders increase their base prices or remove previously included upgrades (flooring, appliances, finishes) to offset the rebate — effectively absorbing part of the savings that should go to the buyer.
Additionally, some builders are only crediting approximately 5% of the HST upfront and requiring buyers to apply for the remaining rebate themselves through their lawyer or accountant after closing. This means you may not see the full savings reflected in your purchase price — and you'll need to file the rebate application separately, which can take months to process.
Always compare the builder's pre-rebate and post-rebate pricing carefully. Ask specifically: "What portion of the HST rebate are you crediting at closing, and what must I apply for on my own?"
Not Everyone Gets the Maximum: Factors That Affect Your Rebate
The HST rebate is not a flat amount — several factors determine how much you actually receive:
Understand Your Rights: Cooling-Off & Conditional Financing Period
All purchasers of pre-construction homes in Ontario have a 10-day cooling-off period during which you can cancel the agreement without penalty. Use this time wisely:
- Get a mortgage pre-approval — confirm you qualify for financing at the builder's price
- Have your lawyer review the Agreement of Purchase & Sale, including HST rebate assignment clauses
- Understand total closing costs: development charges, Tarion enrollment fees, utility connection fees
- Review the occupancy fee period — you may pay occupancy fees for months before final closing
- Verify the HST rebate amount is correctly applied in your agreement
Real Scenario: Brampton 1,200 sq ft Townhome — Resale vs. New Build
Based on current Brampton market data (Q1 2026). Resale townhome average: ~$748,000. New build comparable: ~$699,000 (builder price with HST included and rebate applied).
Resale Townhome
1,200 sq ft • Brampton
Estimated Closing Costs
New Build Townhome
1,200 sq ft • Brampton Pre-Construction
Estimated Closing Costs
📊 Bottom Line Comparison
Net Price Savings
$114,000
New build vs resale
Monthly Payment Savings
$216/mo
$2,592/year saved
Extra Closing Costs (New)
~$29K
Dev charges + occupancy
Even after accounting for higher new-build closing costs (development charges, occupancy fees, utility connections), the HST rebate delivers a net advantage of approximately $85,000+ compared to purchasing a comparable resale property. Add in a brand-new home with Tarion warranty and modern energy efficiency — the new build value proposition is compelling.
What Every Buyer Must Understand: New Build Closing Costs
Development Charges
Municipal fees charged to the builder and passed to you. Can range from $5,000 to $30,000+ depending on the municipality and project. Always confirm the capped amount in your APS.
Occupancy Fees
For condos and some townhomes, you may move in months before final closing (title transfer). During this period you pay occupancy fees (estimated mortgage interest + taxes + condo fees) — typically $1,500–$2,500/month.
Tarion Warranty
All new builds in Ontario include mandatory Tarion warranty coverage (1-year workmanship, 2-year systems, 7-year structure). Enrollment fee is typically $1,000–$1,500.
Utility Connections
New builds require water, hydro, and gas meter connections. Budget $2,000–$3,500 for utility connection fees not included in the builder's base price.
Why New Build May Be More Attractive Than Resale Right Now
⚠️ Caveat: Some builders have raised prices or removed upgrades since the rebate announcement. Always compare net effective pricing (after rebate AND after any price increases or removed inclusions) against resale alternatives. Don't assume the full rebate translates to savings — do the math.
Want to Know How Much You Can Save on a New Build?
Our team has helped buyers across the GTA navigate new construction purchases — from HST rebate calculations to builder negotiations to mortgage structuring. Call us for a free consultation to understand your total cost and savings.
Saminder Juneja, Licensed Mortgage Broker | Get A Better Mortgage Inc. (FSRA #10874) | Mortgage Centre Canada
Frequently Asked Questions
Is the HST rebate still only for first-time home buyers?
No. As of April 1, 2026, Ontario has expanded the full HST rebate to ALL buyers of qualifying new construction homes — not just first-time purchasers. The federal FTHB rebate remains limited to first-time buyers, but the Ontario provincial portion is now available to everyone for agreements entered between April 1, 2026 and March 31, 2027.
How much can I save with the HST rebate?
The theoretical maximum is up to $130,000 in combined rebates. On homes between $500,000 and $750,000, savings of $60,000–$75,000 are possible — but not guaranteed. Your actual rebate depends on purchase price, first-time buyer status, primary residence requirement, and whether the builder has inflated pricing or removed upgrades since the announcement.
Are builders really passing down the full savings?
Not always. We have observed some builders increasing base prices or removing previously included upgrades (hardwood, appliances, finishes) since the rebate expansion was announced — effectively absorbing part of the savings. Additionally, some builders are only crediting about 5% of the HST upfront and requiring buyers to apply for the rest through their lawyer or accountant. Always compare pre- and post-announcement pricing carefully.
Does the builder deduct the full HST rebate from my price?
In many cases, no. Some builders credit only a portion (often around 5%) at closing and require you to apply for the remaining rebate yourself through CRA forms GST190 and RC7190-ON, filed by your lawyer. This can take 60–120+ days to process. Confirm exactly what is being credited in your Agreement of Purchase and Sale.
Will everyone get the maximum rebate?
No. Several factors reduce or eliminate the rebate: purchase price thresholds (rebate phases out above certain price points), whether you are a first-time buyer (affects federal portion), primary residence requirement, type of construction, timing of the agreement (must be April 2026–March 2027 for the expansion), co-ownership arrangements, and your relationship to the builder.
What are occupancy fees and how long do I pay them?
When you move into a condo or some townhome developments before the building is registered, you pay monthly occupancy fees (typically interest on the unpaid balance + estimated property taxes + condo fees). This can last 3–18 months depending on the project. These fees are NOT applied to your mortgage.
Is a new build really cheaper than resale with all the extra costs?
It can be — but only if the builder has not inflated prices. In our Brampton scenario, even after $30K–$44K in additional closing costs, the rebate delivers a net advantage of approximately $85,000+ IF the builder pricing has not been adjusted upward. Always run the numbers with current pricing and compare to actual resale listings.
Can I use the cooling-off period to arrange financing?
Yes, and you absolutely should. Ontario’s 10-day cooling-off period on pre-construction purchases gives you time to secure mortgage pre-approval, have your lawyer review the agreement, and verify all costs including HST rebate terms. We recommend speaking with a mortgage broker BEFORE signing.
Disclaimer: This blog post is for educational purposes only and does not constitute financial or legal advice. HST rebate calculations are estimates based on publicly available information. Rebate eligibility and amounts depend on individual circumstances. Consult your lawyer and mortgage broker for personalized advice.
All mortgage services provided by Saminder Juneja, Mortgage Broker — Mortgage Centre Canada (independently owned and operated) — Get A Better Mortgage Inc. (FSRA #10874).