Ontario and the federal government just made the biggest new-home affordability announcement in a generation. The full 13% HST has been wiped off qualifying new home purchases in Ontario for one year, and it applies to every buyer, not just first-timers. If you have been watching a new build or pre-construction condo and waiting for the right moment, the clock just started.
What actually changed
On March 25, 2026, Premier Doug Ford and Prime Minister Mark Carney announced a joint federal-provincial agreement to temporarily remove the full Harmonized Sales Tax on new homes in Ontario. The program took effect April 1, 2026 and runs through March 31, 2027.
To be clear about what “full HST” means: that is the combined 8% Ontario provincial portion and the 5% federal GST portion. Together they equal 13%. On a $1,000,000 new home, that is $130,000 that used to go to the government. Under this program, it stays in your pocket.
This builds on an earlier program that only applied to first-time buyers and only removed the provincial portion. This new version is open to everyone and covers the whole tax.
How much can you save?
The savings depend on the purchase price of the home. Here is exactly how it breaks down:
| Purchase price | How it works | Your saving |
|---|---|---|
| Up to $1,000,000 | Full 13% HST wiped out | Up to $130,000 |
| $1,000,001 to $1,500,000 | Flat rebate cap applies | $130,000 |
| $1,500,001 to $1,850,000 | Rebate phases down gradually | $130K down to $24K |
| Over $1,850,000 | Existing rebate applies | $24,000 |
To put that in real terms: if you were buying an $800,000 new build condo under the old rules, you would have been paying roughly $80,000 in net HST on top of the price. Under the new rules, that goes to zero. The home costs $800,000, full stop.
In most cases, your builder will apply the rebate directly at closing. You will not see the HST appear on your agreement and then come off. The price you sign is the price you pay.
Do you qualify?
The eligibility rules are simpler than most people expect. Here is the short version:
- ✓ You are buying a newly built home from a builder. Houses, townhomes, and condos all count. Pre-construction inventory qualifies too.
- ✓ Your purchase agreement is signed between April 1, 2026 and March 31, 2027. The signing date is the trigger. Not when you move in, not when you take possession.
- ✓ The home will be your primary residence or a rental property. Investors buying to rent qualify under the program.
- ✓ You are any buyer. First-time buyers, move-up buyers, and downsizers all qualify equally. This is a major change from the earlier version of the program.
- ✗ Resale homes do not qualify. The HST rebate only applies to new construction bought directly from a builder.
- ✗ Agreements signed before April 1, 2026 are not eligible, even if you close after that date. The signed date on the contract is what counts.
There are also construction timing requirements. For primary residences, construction must begin by December 31, 2028 and be substantially completed by December 31, 2031. For rental properties, completion is required by December 31, 2029. These timelines are relevant mostly for pre-construction purchases where the build is years away.
How the Ontario HST rebate affects your mortgage
This is the part that most people overlook, and it is genuinely important. The HST removal does not just save you money at signing. It changes the entire mortgage picture.
Your purchase price and mortgage are both lower
When a builder credits the rebate at closing (standard practice for owner-occupied homes), the purchase price on your mortgage application is the pre-tax amount. Your lender qualifies you on that number. That means a smaller mortgage, lower monthly payments, and a better loan-to-value ratio.
When the HST is removed from the purchase price, you borrow less money. A lower mortgage amount means it is easier to pass the stress test, your debt ratios improve, and your required down payment is calculated on the lower net price. For a buyer who was close to qualifying on a new build, this change can be the difference between approval and a decline.
Your down payment is based on the lower price
The minimum down payment in Canada is calculated as a percentage of the purchase price. When the HST disappears from that price, your minimum required down payment drops with it. On a $900,000 new build, your 5% minimum is now calculated on $900,000, not $1,017,000. That is real money freed up for closing costs, upgrades, or just staying liquid.
You may qualify now when you did not before
If you ran the numbers on a new build in the past year and were told you did not quite qualify, it is worth revisiting. A materially lower purchase price changes what the stress test calculation looks like. The rate itself has not changed, but the mortgage amount has, and that flows through everything.
Pre-construction condos near the $1M mark
One of the most interesting effects of this program is what it does for buyers looking at homes priced just above $1,000,000. For buyers whose home was priced at, say, $1,050,000 before tax adjustments, the effective purchase price may now sit below $1,000,000, which can affect insured mortgage eligibility. It is worth running the specific numbers with a broker before assuming which bracket you fall in.
A few things to watch out for
The Ontario 8% provincial portion is confirmed in the provincial budget. The federal 5% GST portion is subject to passage of amendments to the Excise Tax Act. In practical terms both are expected to go through, but your lawyer will confirm the exact amounts on your closing documents. Do not sign a purchase agreement counting on the full savings without getting proper advice first.
There is also a specific mechanic to watch on builder contracts. Most builders will assign the rebate credit directly at close, which means the buyer benefits fully. Some contracts include clauses that assign the rebate rights to the builder. Before signing, have a real estate lawyer review the agreement to confirm you are actually getting the saving and not just signing it over.
If you are buying a rental property, the process works differently. Investors must pay the full HST upfront at closing and then apply to the CRA for the rebate after the fact. This affects how lenders calculate your mortgage, since they underwrite based on the gross price. Flag this early with your broker so the cash-to-close planning is accurate.
Key dates at a glance
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April 1, 2026. Program opens. Any purchase agreement signed on or after this date is eligible.
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December 31, 2028. Construction must begin by this date for primary residence purchases.
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December 31, 2029. Construction completion deadline for rental property purchases.
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March 31, 2027. The program ends. Last date to sign a qualifying agreement.
The bottom line
This is a genuine, significant change to the cost of buying a new home in Ontario. For someone purchasing at $800,000, the saving is larger than most people’s annual salary. For someone who was on the edge of qualifying, it changes what is possible.
The window is one year and the signing date is the trigger. If you have been thinking about a new build, now is the time to understand what you qualify for before the best inventory gets picked off or the window closes.
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Start my application →This post is for general informational purposes only and does not constitute mortgage, legal, or tax advice. The Ontario HST rebate program is subject to federal legislative approval and your individual eligibility will depend on your specific purchase agreement, intended use of the property, and construction timelines. Always consult a licensed mortgage professional, real estate lawyer, and accountant before signing a purchase agreement or making financing decisions.