The Ontario government has announced plans to offer a rebate on its portion of the HST on new homes, potentially saving eligible first-time buyers as much as $130,000, when combined with other provincial and federal savings initiatives.
The move follows a promise the Doug Ford government had previously made that if Ottawa were to waive its share of the HST for first-time homebuyers, the province would follow suit.
Bethlenfalvy said the proposed rebate will offer some relief to homebuyers at a time where “every dollar counts.”
“Through measures like this HST relief, we’re helping more young families take that first step into home ownership,” he said.
The change could result in savings of $80,000 for new homebuyers when it is combined with the existing Ontario HST New Housing Rebate, which provides a refund of up to $24,000 to eligible buyers.
Add to this the Liberal government’s proposal earlier this year to waive the federal component of the HST on new and significantly renovated homes priced up to $1 million and first-time homebuyers could save an extra $50,000, the ministers said. Combined with provincial rebates, saving could total up to $130,000 for qualified buyers.
Implementation of the Ontario rebate will be contingent upon the federal government making the required regulatory changes, the province added. The tax relief will apply to homes acquired on or after May 27, 2025, and prior to 2031, the province said. Home builds must begin before 2031 and achieve substantial completion before 2036 to qualify.
Housing Starts
Flack said the rebate will help create “the conditions to build” at a time when the province needs more housing.“Uncertainty has led builders and buyers to hit the pause button. Subject to federal legislation, they will soon be able to take their finger off that pause button,” he said. “Our mission is simple. We want to get homes built, we want to keep workers on the job, and we want to keep the dream of home ownership alive.”
Ontario is not on track to achieve its housing start goal, and Flack has begun to shift focus from Premier Doug Ford’s previous promise to construct 1.5 million homes within a decade.
“It takes too long and it costs too much to build a home in this province,” he said, noting that his current objective is to “create the conditions” to get builder building again by lowering costs and eliminating red tape.
NDP Opposition Leader Marit Stiles told reporters at Queen’s Park the rebate is “a step in the right direction,” but added that there is a scarcity of new homes available for purchase.
“I don’t know where people are supposed to buy these homes, they simply do not exist,” she said. “The government has given up on their commitment completely to build 1.5 million homes. They don’t even want to talk about any kind of targets.”
She said the Ford government should be focused on affordability as a whole, rather than pinpointing homes for first-time buyers.
“People right now aren’t worrying about whether they can buy a home,” she said. “They’re worried about if they can make rent, they’re worried about if they can feed their kids.”
Liberal housing critic Adil Shamji said the government should have implemented the proposal made by his party earlier this year: an HST rebate for all new primary residence purchases, rather than limiting it to first-time homebuyers.
