Ontario’s Expanded HST Rebate: A Game-Changer for New Home Buyers in 2026

In a bold move to tackle Ontario’s housing affordability crisis, the provincial government announced a groundbreaking expansion of the HST rebate program in March 2026. Previously limited to first-time home buyers, this temporary initiative now opens the door to all eligible buyers of new homes, offering up to $130,000 in tax relief. As of April 1, 2026, this one-year program is already making waves in the Greater Toronto Area (GTA) real estate market, where new builds have long been burdened by the 13% Harmonized Sales Tax (HST) comprising 5% federal GST and 8% provincial HST. For buyers eyeing projects like those in Brampton, Mississauga, or Woodbridge, this could mean tens of thousands in savings at closing.

The announcement came as part of Ontario’s 2026 Budget, unveiled by Premier Doug Ford during a press conference in Mississauga. Ford emphasized that the rebate applies regardless of whether you’re a first-time purchaser, a repeat buyer, or even an investor building for rental purposes. “Whether you’re a first-time buyer, second-time, or a 10-time buyer, you’re getting the HST deducted,” Ford stated, highlighting the program’s inclusivity. In partnership with the federal government, Ontario is covering its provincial share, pushing the total relief to unprecedented levels for qualifying properties.

How the Expanded Rebate Works

At its core, the HST rebate allows buyers to recover a portion or in many cases, all of the tax paid on new homes. Under the new rules, effective for purchase agreements signed between April 1, 2026, and March 31, 2027, the rebate scales based on the home’s fair market value:

• For new homes valued at up to $1 million, buyers receive a full 100% rebate on the HST, up to $130,000 total.

• Homes priced between $1 million and $1.5 million remain eligible for the maximum $130,000 rebate.

• For properties valued from $1.5 million to $1.85 million, the rebate phases out linearly, dropping from $130,000 to $24,000.

• Above $1.85 million, the rebate caps at the pre-existing $24,000 maximum.

This structure reflects Ontario’s housing market realities, where average new home prices in the GTA often hover around $1.2 million for detached homes and townhouses. Builders can typically credit the rebate directly at closing using CRA Form GST190, streamlining the process and reducing upfront costs for buyers. Construction must begin by December 31, 2028, and be substantially completed by December 31, 2031, ensuring the program targets active developments without retroactivity.

The expansion builds on the federal GST/HST New Housing Rebate, which has long provided relief for primary residences or residential rentals. Ontario’s enhancement supercharges the provincial portion, making it a powerful incentive. Experts predict this could spur an additional 8,000 housing starts in 2027 alone, supporting 21,000 jobs in construction and related sectors while addressing the province’s need for 1.5 million new homes by 2031.

Who Qualifies and What Homes Are Eligible?

Eligibility is straightforward but requires meeting key criteria. Buyers must acquire a qualifying new home directly from a builder, such as:

• Newly constructed single-family homes, townhouses, or semi-detached properties.
• Condominium units.
• Owner-built homes (with construction starting after April 1, 2026).
• Substantial renovations or conversions from non-residential use.

The property must serve as a primary residence for the buyer or their family, or as a residential rental property. Shares in co-operative housing projects also qualify. Importantly, resale homes do not qualify this is strictly for new builds to boost supply.

Not everyone automatically gets the full amount. Buyers need to confirm they haven’t owned a home worldwide in the past year (though this first-time rule is waived under the expansion), and the home can’t be used primarily for short-term rentals like Airbnb. For rentals, the property must be leased long-term at fair market rates.

Disclaimer: Prices displayed on this website may or may not include the HST rebate, and eligibility for the rebate may or may not apply to your purchase, as program details and rules are subject to ongoing changes please consult the Canada Revenue Agency or a tax professional for your specific situation.

Why Now? Timing and Next Steps

With the program limited to one year, urgency is building. Purchase agreements signed before April 1 miss out, but those locked in by March 31, 2027, stand to benefit. First-time buyers enjoy extended federal perks until 2030, but all others should act fast.

To claim the rebate, work with your builder or lawyer to file with the CRA post-closing if not credited upfront. Tools like the CRA’s rebate calculator can estimate your savings.

This expansion isn’t just tax relief it’s a catalyst for affordability in a overheated market. As Ontario pushes toward housing abundance, buyers from Brampton to the Valley in Woodbridge have a narrow window to save big. If you’re in the market for a new home, now’s the time to explore options and crunch the numbers.