Ontario's 2026 New Housing HST Rebate Explained: Who Qualifies, How Much You Could Save, and What Buyers Need to Know Before Purchasing a New Build or Pre-Construction Home
By Jay Jeganathan, B.A., ABR, SRES | Real Estate Broker, Century 21 People's Choice Realty Inc., Brokerage | ThePreConVault.com
Updated: October 26, 2026 | Reading time: approximately 9 minutes
Thinking About Buying a New Home in Ontario? You Could Save Up to $130,000!
If you've been considering purchasing a brand-new home, pre-construction condominium, or newly built townhouse in Ontario, there's some important news that could significantly affect your purchasing decision.
Ontario has introduced expanded HST relief that could allow eligible buyers to save up to $130,000 on qualifying new homes.
Yes, you read that correctly. That's potentially $130,000 in tax relief.
But before you start calculating how much money you could save, it's important to understand that not every home, buyer, or purchase agreement automatically qualifies.
The type of property you're purchasing, when you signed your agreement, the purchase price, construction timelines, and how you intend to use the property can all affect eligibility.
At The Pre-Con Vault, we believe buyers should understand the financial side of purchasing new construction just as well as they understand the floor plans, finishes, and builder incentives.
Let's break down how the HST rebate works, who may qualify, and six important things to check before signing an agreement of purchase and sale.
1. What Is the Ontario New Housing HST Rebate?
First, let's understand the basics.
In Ontario, the Harmonized Sales Tax (HST) is 13%, consisting of:
5% federal portion
8% Ontario provincial portion
When you purchase a newly constructed residential property, HST generally applies to the taxable purchase.
Traditionally, new-home buyers have had access to certain HST rebates, subject to eligibility requirements and purchase-price thresholds.
However, the expanded programs introduced in 2026 provide substantially greater potential relief for eligible buyers.
There are several programs buyers should understand:
Ontario Enhanced New Housing Rebate (ENHR): Provides temporary additional relief from the provincial 8% portion of HST on qualifying newly constructed or substantially renovated homes.
Ontario New Home Affordability Payment (ONHAP): A provincial payment that can provide additional relief relating to the federal 5% portion of HST for qualifying purchases.
First-Time Home Buyers' GST/HST Rebate: A separate federal program that provides eligible first-time buyers with relief of up to $50,000 on the federal portion of HST.
Ontario also has a first-time homebuyers' rebate relating to the provincial portion of HST.
These programs have different eligibility requirements, timelines, and administrative processes. Buyers must avoid assuming they can automatically receive every rebate or claim the same tax twice.
2. How Much HST Could You Save on a New Home?
Here's where things get interesting.
For an eligible property valued at $1 million, the 13% HST represents $130,000.
Under Ontario's temporary expanded HST relief, qualifying buyers may receive relief equivalent to the full 13% HST, subject to program limits.
The maximum potential relief is divided into two components:
Ontario provincial HST relief (8%): Up to $80,000
Federal HST-related relief (5%): Up to $50,000
Combined maximum potential relief: $130,000
The maximum benefit is not necessarily the same as 13% of every property's purchase price.
For qualifying purchases under the temporary Ontario program, the full $130,000 maximum can remain available for certain homes valued between $1 million and $1.5 million. Above that range, the benefit may be reduced according to the applicable rules.
Example: Purchasing a $900,000 New Construction Home
Let's say you're considering a newly built townhouse priced at $900,000 before HST.
The HST calculation would look like this:
Purchase price before HST: $900,000
Provincial HST at 8%: $72,000
Federal HST at 5%: $45,000
Total HST: $117,000
If the purchase qualifies for full relief under the applicable programs, the potential combined benefit could be $117,000.
That's a substantial amount of money that could affect your overall purchasing budget.
Important: This example assumes a price before HST and full eligibility. Many Ontario builders advertise prices that already reflect assigned rebates, so buyers should not subtract the rebate from an advertised price without reviewing the agreement.
3. Who Qualifies for the Enhanced Ontario HST Rebate?
One of the biggest misconceptions about the new rebate is that it's exclusively available to first-time homebuyers.
That's not necessarily the case.
The temporary Ontario Enhanced New Housing Rebate can be available to qualifying buyers who are not first-time homeowners.
For an owner-occupied purchase, the home must generally be acquired for use as the buyer's or their relation's primary place of residence.
This means someone who already owns a home but plans to move into a newly constructed property may still qualify, provided the other requirements are met.
The temporary enhanced rebate can apply to qualifying:
Newly built detached and semi-detached homes
New construction townhouses
Pre-construction condominium units
Certain substantially renovated residential properties
Eligibility depends on the legal nature of the purchase, the agreement dates, price, construction requirements, and intended use.
The key takeaway: Being a repeat buyer does not automatically disqualify you from the temporary enhanced Ontario program. However, being a first-time buyer can open access to additional programs with different rules.
4. Six Important Things to Check Before Buying a New Build
Before purchasing a new construction property, review these six important factors.
Check #1: Your Agreement of Purchase and Sale Date
For a typical qualifying home purchased from a builder under the temporary Ontario Enhanced New Housing Rebate, the agreement of purchase and sale must generally be entered into between:
April 1, 2026, and March 31, 2027.
This makes the agreement date extremely important.
For example, purchasing a new-build home in November 2026 could place you within the relevant agreement window.
However, signing an agreement outside that window may mean you do not qualify for this particular temporary program, even if the property is completed or occupied during the eligible period.
Assignments can introduce additional complications because both the original builder agreement and the assignment transaction must be examined.
Our advice: Before signing, have your real estate lawyer, tax accountant, real estate advisor confirm which rebate rules apply to the specific agreement.
Check #2: Construction Start and Completion Dates
The date you sign your agreement isn't the only timeline that matters.
For qualifying purchases from builders under the temporary Ontario ENHR, construction generally must:
Begin on or before December 31, 2028.
Be substantially completed on or before December 31, 2031.
The applicable tax must also become payable within the program's deadline, generally no later than December 31, 2032.
Why is this important?
Pre-construction projects can experience delays due to permits, financing, construction schedules, labour availability, and other factors.
If you're purchasing a condominium scheduled for completion several years from now, understanding the project's construction timeline is essential.
Before purchasing, ask the builder about the anticipated construction start, expected occupancy, final closing, and any contractual rights to extend those dates.
Check #3: How You Intend to Use the Property
This is one of the most important eligibility considerations.
The owner-occupied Ontario Enhanced New Housing Rebate generally requires the property to be intended as the primary residence of the purchaser or a qualifying relation.
A primary residence is generally the home where someone ordinarily lives on a permanent basis.
For example, purchasing a new condominium with the intention of moving into it as your principal home may satisfy the intended-use requirement.
Purchasing the same condominium solely to rent it out is a different situation.
What about investors?
Ontario also has an Enhanced New Residential Rental Property Rebate, which has separate conditions for qualifying rental housing.
An investor should not assume the owner-occupied rebate applies to their rental property. Instead, they should investigate the rental rebate program and obtain advice about the property's specific circumstances.
Check #4: The Purchase Price Before HST
The purchase price directly affects the amount of relief available.
For the temporary Ontario enhanced program, qualifying homes valued up to $1 million may receive relief equivalent to the full 8% provincial HST, up to $80,000.
For certain higher-priced qualifying homes, the maximum provincial benefit may remain available, before being reduced at higher price levels.
The temporary program has an upper price threshold of less than $1.85 million for typical builder sales.
Remember that the rebate calculation is not necessarily based on the amount shown on a marketing flyer.
You need to establish whether the builder's quoted price includes HST, reflects assigned rebates, or includes additional taxable amounts.
This is especially important when comparing multiple pre-construction projects.
Check #5: Property Delivery and Final Closing
Pre-construction buyers often hear two terms: occupancy and final closing.
They're not always the same thing.
In a condominium purchase, interim occupancy can occur before ownership officially transfers to the buyer.
During interim occupancy, buyers may be required to pay occupancy fees even though the condominium has not yet reached final closing.
The applicable HST and rebate rules depend on the type of transaction and when the tax becomes payable.
For the temporary Ontario enhanced program, the December 31, 2032 tax-payable deadline is an important consideration.
What should buyers do?
Have your lawyer review the builder's closing provisions, HST adjustment clauses, occupancy provisions, and rebate assignments before committing to the purchase.
Check #6: Assignment Sales and Rebate Eligibility
Assignment sales deserve special attention.
An assignment occurs when an original purchaser transfers their contractual interest in a pre-construction property to another buyer before the original transaction closes.
Assignment transactions can have their own HST consequences.
For the temporary enhanced rebate, the original builder agreement date and the assignment arrangement may affect eligibility.
The price used for determining eligibility can also include consideration paid for a taxable assignment.
For example, a purchaser may acquire a pre-construction condo through an assignment and plan to move into the property after completion.
That buyer should not assume the property automatically qualifies simply because the assignment agreement was signed during the temporary rebate window.
Our recommendation: Assignment purchasers should obtain legal and tax advice before waiving conditions, particularly where the advertised purchase price assumes rebate eligibility.
5. First-Time Homebuyers: Are There Additional Benefits?
Yes.
The federal First-Time Home Buyers' GST/HST Rebate provides eligible purchasers with relief from the federal 5% portion of HST.
For qualifying first homes:
Homes valued at $1 million or less may qualify for up to $50,000 in federal tax relief.
Homes valued between $1 million and $1.5 million are subject to a gradually reduced federal rebate.
Homes valued at $1.5 million or more do not qualify for this particular federal first-time buyer rebate.
The federal program generally applies to qualifying builder agreements entered into on or after March 20, 2025, and before 2031, subject to other conditions.
Ontario also provides first-time buyer relief on the provincial HST portion, potentially up to $80,000.
To qualify as a first-time buyer under the federal program, you must meet specific requirements involving age, citizenship or permanent-resident status, and previous homeownership or occupancy.
Generally, you must not have lived in a home owned by you or your spouse or common-law partner during the relevant current-year and four-calendar-year lookback period.
This is different from simply asking whether you've ever purchased a property before.
If you're purchasing your first home, it is worth reviewing both the federal and Ontario programs before making an offer.
6. Is the HST Rebate Already Included in the Builder's Purchase Price?
This is a question every buyer should ask.
Some builders advertise purchase prices that already account for expected new housing rebates.
For example, a builder may advertise a home for $799,900, with contractual provisions requiring the purchaser to assign an eligible rebate to the builder.
If that rebate has already been credited against the price, the purchaser cannot claim the same amount again.
This is why the statement of adjustments and the wording of the agreement of purchase and sale matter.
Before signing, ask:
Is the advertised price inclusive or exclusive of HST?
Has any HST rebate already been factored into the advertised price?
Is the purchaser required to assign a rebate to the builder?
What happens if the CRA later determines the purchaser was not eligible?
Is the Ontario New Home Affordability Payment being credited at closing, or does the purchaser need to apply separately?
A rebate can have a meaningful financial benefit, but it should never be counted twice in your budget.
7. What Is the Ontario New Home Affordability Payment (ONHAP)?
The Ontario New Home Affordability Payment is an important part of the province's temporary expanded HST relief.
It is designed to complement the enhanced Ontario rebate by providing additional relief associated with the federal 5% portion of HST for eligible transactions.
Unlike the CRA-administered federal first-time buyer rebate, ONHAP is administered by Ontario.
This distinction matters because the application process and required documents may differ.
Buyers should confirm whether the builder is crediting the payment, whether a separate application is required, and whether the necessary consent and documentation have been completed.
For buyers who are not first-time homeowners, ONHAP can be particularly important when determining the potential combined benefit.
8. Can You Qualify for the Rebate on a Move-In-Ready Inventory Home?
Potentially, yes.
Not every new construction purchase involves waiting three or four years for a project to be completed.
Builders sometimes have inventory homes available for immediate or near-term occupancy.
These can include completed townhouses, detached homes, or unsold condominium units.
A newly completed inventory home may qualify for the temporary enhanced program if the agreement and other conditions are satisfied.
However, a home being advertised as "brand new" does not, by itself, establish eligibility.
Buyers should confirm the home's tax status, previous occupancy, construction dates, agreement date, and whether the purchase qualifies under the applicable rebate rules.
This is an area where working with someone familiar with new construction transactions can make a difference.
9. What Happens If the CRA Denies Your Rebate?
Here's something buyers should understand before closing.
If a builder credits you with a rebate and the Canada Revenue Agency later determines that you were not eligible, you may be required to repay that amount.
Depending on the circumstances, this could become a significant financial obligation.
That's why buyers should avoid making assumptions about eligibility based solely on advertising material or general rebate announcements.
Keep copies of your purchase agreement, amendments, assignment agreements, statement of adjustments, occupancy documents, and rebate-related forms.
Most importantly, have the eligibility and financial implications reviewed by the appropriate professionals before closing.
10. Frequently Asked Questions About Ontario's New Housing HST Rebate
Can I get $130,000 back if I purchase a new home in Ontario?
Eligible buyers may receive combined relief of up to $130,000 under the temporary expanded programs. The actual benefit depends on the property's value, transaction dates, eligibility, and how the rebate or payment is administered.
Do I have to be a first-time homebuyer?
No. The temporary Ontario Enhanced New Housing Rebate is not limited to first-time buyers. However, the separate first-time buyer programs have their own qualification requirements.
Does the HST rebate apply to pre-construction condominiums?
Yes, qualifying new condominium purchases can be eligible. The agreement date, construction schedule, intended use, price, and other requirements must be reviewed.
Does the rebate apply to resale homes?
Generally, no. Ordinary resale residential properties are typically exempt from HST. These new housing programs primarily concern qualifying newly constructed or substantially renovated properties.
Can I receive the rebate if I already own a home?
Potentially, yes, under the temporary Ontario enhanced program. You must still satisfy the primary-residence and other applicable conditions. Ownership of another home can affect eligibility for the separate first-time buyer rebates.
Can investors qualify?
Investors may qualify for relief under the separate enhanced residential rental property program if its requirements are met. The owner-occupied rebate should not be assumed to apply to a property purchased solely for rental use.
What if I signed my pre-construction agreement before April 1, 2026?
You may not qualify for the temporary Ontario Enhanced New Housing Rebate under the standard builder-purchase rules. However, other rebate programs may apply, including the federal and Ontario first-time buyer programs where eligible.
Is the HST rebate paid in cash?
Not necessarily. Depending on the program and transaction, relief may be credited by the builder, assigned through the agreement, or claimed through an application. Buyers should confirm the specific process before closing.
Can I claim the rebate after closing?
Some rebates can be claimed after closing within prescribed filing deadlines. The applicable time limits, forms, and eligibility rules vary by program.
Does the HST rebate eliminate land transfer tax?
No. HST rebates and land transfer tax rebates are separate. Buyers should still budget for applicable Ontario land transfer tax, Toronto municipal land transfer tax where relevant, legal fees, adjustments, and other closing costs.
11. Final Thoughts: Don't Overlook the HST Rebate When Buying New Construction
Purchasing a new construction property is a major financial commitment.
Between deposits, mortgage financing, development charges, closing costs, and construction timelines, there are many moving parts to consider.
The expanded HST relief available in Ontario could make a meaningful difference for qualifying purchasers.
But the most important thing to understand is that eligibility isn't automatic.
Two buyers purchasing similar properties at similar prices may have different rebate outcomes depending on their agreement dates, intended use, builder arrangements, and other circumstances.
Before purchasing, make sure you understand exactly what you're buying, what rebates may apply, and how those rebates are reflected in the purchase price.
A little due diligence before signing can prevent a costly surprise later.
Looking for a New Construction Home in Ontario?
Whether you're a first-time buyer, planning to upgrade your current home, or exploring pre-construction opportunities, understanding the numbers is just as important as finding the right property.
At ThePreConVault.com, our goal is to help buyers explore new construction opportunities across the Greater Toronto Area and surrounding Ontario communities while staying informed about market developments, builder incentives, and purchasing considerations.
Explore new construction and pre-construction opportunities at ThePreConVault.com.
Have questions about a particular new-build project or whether a property may qualify for an HST rebate?
Connect with us to discuss your options and the questions you should be asking before making a purchase.
Jay Jeganathan, B.A., ABR, SRES
Real Estate Broker | Century 21 People's Choice Realty Inc., Brokerage
Direct: 647-963-2677
Website: https://thepreconvault.com
Helping buyers and sellers navigate Ontario real estate since 2011.
Important Disclaimer
This article is provided for general educational purposes and does not constitute legal, accounting, tax, or financial advice. HST rebate eligibility is determined by applicable legislation, program rules, and individual transaction circumstances. Government programs and administrative requirements may change. Consult a qualified real estate lawyer, accountant, or tax professional and verify current requirements with the Canada Revenue Agency and Government of Ontario before relying on any potential rebate.
Government resources:
Canada Revenue Agency — Ontario Enhanced New Housing Rebate
Canada Revenue Agency — First-Time Home Buyers' GST/HST Rebate
Government of Ontario — Ontario New Home Affordability Payment
Canada Revenue Agency — Guide RC4028, GST/HST New Housing Rebate