Ontario Is Removing the HST on New Homes. Save Up to $130,000!
- Ringo Tsang
- Mar 24
- 7 min read
For the first time, the full 13% HST rebate on new homes is open to all Ontario buyers — not just first-timers. Here's everything you need to know before April 1, 2026.
Ontario just made one of the most significant housing announcements in decades. On the morning of March 25, 2026 — one day ahead of the provincial budget — Premier Doug Ford confirmed that the provincial and federal governments will temporarily remove the full 13% Harmonized Sales Tax (HST) on new homes for all eligible buyers in Ontario. The window opens April 1, 2026 and closes March 31, 2027.
This isn't just for first-time buyers anymore. Whether you're moving up, downsizing, buying an investment property, or purchasing your first home, this rebate applies to you — and the savings can be life-changing.
At NPS Group, we work with buyers, investors, and renters across Toronto and Calgary every day. Here's our complete, plain-English breakdown of the new Ontario HST rebate — who qualifies, how much you save, and the critical deadlines you cannot miss.
Quick Summary: Ontario and the federal government are eliminating the full 13% HST on new homes valued up to $1.5 million from April 1, 2026 to March 31, 2027. The maximum rebate is $130,000. All buyers — not just first-time purchasers — are eligible, provided the home is a primary residence or residential rental property.
What Is the Ontario HST Rebate on New Homes?
When you buy a newly built home in Ontario, you pay the Harmonized Sales Tax — a combined 13% tax made up of the 8% provincial portion and the 5% federal portion. On a $1,000,000 home, that's $130,000 in tax on top of the purchase price.
Historically, a partial rebate existed, but it was limited to homes priced well below current market rates and was capped at modest amounts. The Ford government had already expanded this in the fall of 2025 for first-time buyers on homes under $1 million — but that barely moved the needle on housing starts.
Now, the rules have changed entirely. For one year starting April 1, 2026, the full 13% HST is rebated on qualifying new homes for all buyers. The province will cover the 8% provincial share; Ottawa has agreed to cover the 5% federal share, pending federal legislation.
"This is like a big sale sign — 13% off. If I were people out there, I'd be buying these new homes, and do it right away."
— Premier Doug Ford, March 25, 2026
How Much Can You Save? The Complete Rebate Breakdown
Home Price | HST Rebate | Notes |
Up to $1,000,000 | Up to $130,000 (full 13%) | Full HST eliminated |
$1,000,001 – $1,500,000 | $130,000 maximum | Full $130K cap maintained |
$1,500,001 – $1,849,999 | Between $24,000 – $130,000 | Decreases proportionally |
$1,850,000 and above | $24,000 minimum | Pre-existing rebate applies |
To put that in perspective: the average new condo in Toronto costs well over $750,000. Under these new rules, a buyer of a $800,000 new condo could pocket $104,000 back — money that previously went straight to the government.
Who Qualifies? Eligibility Requirements Explained
This is one of the most important sections to read carefully. Here is what you must satisfy to qualify for the expanded 2026 Ontario HST rebate:All buyers are eligible — not just first-time home buyers. Repeat buyers, investors, and upgraders all qualify.
The home must be used as a primary residence OR a residential rental property.
The purchase agreement with the builder must be signed between April 1, 2026 and March 31, 2027.
Construction must begin on or before December 31, 2028, with substantial completion on or before December 31, 2031.
Alternatively: if construction began before March 31, 2026, the purchase agreement is signed during the qualifying window, and construction is substantially completed by December 31, 2029.
The property must be a newly built home — resale properties do not qualify.
Important for Investors: The inclusion of residential rental properties is a significant change from earlier rebates. If you're purchasing a new build to rent out, you are now eligible for this historic rebate — making 2026 one of the best years in recent memory to expand a rental portfolio in Ontario.
Why Is the Ontario Government Doing This Now?
Ontario is facing a dual crisis: a housing affordability crunch for buyers, and a construction slowdown that threatens thousands of jobs. New home starts have been falling for years, partially because rising taxes and development charges have pushed the cost of new construction to record highs.
The province estimates this rebate will trigger 8,000 additional housing starts annually, boost Ontario's GDP by $2.7 billion, and support up to 21,000 jobs in the construction sector. The combined provincial-federal cost is estimated at $2.2 billion in tax relief.
Scott Andison, CEO of the Ontario Home Builders' Association, called it "the biggest announcement we've seen in home building in decades." The Toronto Regional Real Estate Board (TRREB) echoed that sentiment, welcoming the move as a critical step toward addressing affordability and supply.
Premier Ford praised Prime Minister Mark Carney for agreeing to share the cost, noting that federal-provincial negotiations had been underway for months before the announcement.
Key Deadlines — Don't Miss the Window
This is a time-limited program. Missing the window means losing out on up to $130,000 in savings. Here are the critical dates:
Deadline | Requirement | |
April 1, 2026 | Program start date — purchase agreements can now be signed | |
March 31, 2027 | Last day to sign a qualifying purchase agreement with a builder | |
December 31, 2028 | Construction must begin (for agreements signed in the qualifying window) | |
December 31, 2031 | Construction must be substantially completed (standard path) | |
December 31, 2029 | Completion deadline if construction began before March 31, 2026 |
The single most important date for most buyers is March 31, 2027 — the last day to sign your purchase agreement. After that date, you revert to the old, much smaller rebate rules.
What Does This Mean for the Ontario Housing Market?
The consensus among real estate and construction experts is clear: this is a market-moving announcement. Here's what buyers, sellers, and investors should expect in the months ahead.
New Home Sales Will Surge
Builders and developers who have been sitting on pre-construction inventory are expected to accelerate launches. With the rebate effectively acting as a 13% price reduction on new homes, demand from buyers who were priced out should increase substantially. If you're shopping for a new build, expect more competition and faster sales cycles over the next 12 months.
Pre-Construction Is Now More Attractive Than Ever
Pre-construction homes that are currently available — or launching in 2026 — are positioned to benefit most directly from this program. Buyers who act early lock in today's prices while benefiting from the full rebate. Given that construction timelines extend to 2029–2031, agreements signed now still fall well within the program parameters.
Rental Property Investment Gets a Boost
For investors, the inclusion of residential rental properties in the rebate eligibility is a game-changer. If you've been considering adding a new-build rental unit to your portfolio in Toronto or the GTA, 2026 is arguably the best window to act in a generation. NPS Group's property management and land development services are built for exactly this moment.
Renovation vs. New Build: The Math Has Shifted
For homeowners weighing whether to renovate their current property or sell and buy a new build, this rebate shifts the math significantly. A $130,000 tax saving on a new home is a powerful incentive to move — and NPS Group's renovation expertise means we can help you maximize the value of your existing home before listing.
Frequently Asked Questions (FAQ)
Does the Ontario HST rebate apply to resale homes?
No. The rebate applies only to newly built homes — homes purchased directly from a builder under a new construction agreement. Resale properties are not eligible.
I'm not a first-time buyer. Can I still get the rebate?
Yes. This is the key change from previous programs. The 2026 Ontario HST rebate is available to all buyers, regardless of whether you've owned a home before.
Can I claim the rebate if I'm buying to rent out the property?
Yes. The rebate applies to homes used as either a primary residence or a residential rental property. Investors purchasing new builds as rental units are eligible.
What if the federal legislation doesn't pass?
Ontario has committed to covering the full 13% rebate. The federal government has agreed in principle to cover their 5% share, subject to legislative passage. The Ontario provincial portion is not dependent on federal legislation. Buyers should consult a real estate lawyer for the latest on the federal component.
How does NPS Group help with buying new homes in Ontario?
NPS Group offers property management, land development consultation, and home renovation services across Toronto and Calgary. We help investors and homeowners navigate the Ontario new home market, understand their options, and make the most of programs like this rebate. Contact us to speak with our team.
Is there a maximum home price to qualify?
There is no hard cut-off, but the rebate structure changes at key price points. Homes under $1.5 million qualify for the full $130,000 rebate. Between $1.5M and $1.85M, the rebate decreases proportionally. Homes above $1.85M still qualify for $24,000 under pre-existing rules.
BOTTOM LINE
Should You Buy a New Home in Ontario Right Now?
If you've been on the fence about purchasing a new home in Ontario — whether as a primary residence or an investment property — this announcement removes one of the biggest barriers in the market. Up to $130,000 in tax savings on a purchase that was already on your radar is a material shift in the affordability equation.
That said, it's important to act with information, not just urgency. Review your financing before signing any purchase agreements. Understand the construction timeline requirements for the specific property you're considering. And work with professionals who can help you structure the purchase correctly to ensure you qualify for the rebate.
At NPS Group, we've spent over a decade helping clients in Toronto and Calgary navigate the real estate market — from property management and land development to home renovation and investment strategy. This announcement is exactly the kind of historic opportunity our team exists to help you take advantage of.
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