Ontario and the federal government have temporarily removed the biggest barrier to the HST new home rebate: the requirement that the buyer move in. For one year, any buyer of a newly built home in Ontario — investor, second-home purchaser, or primary resident — can claim the combined federal-provincial rebate, potentially saving up to $30,000 at closing. If you work new-construction deals in the GTA, this is a conversation you'll have with almost every client this year. Here's exactly what changed, who benefits, and how to walk them through it.
What Is the HST New Home Rebate?
New homes in Ontario are subject to the full 13% HST (5% federal GST + 8% Ontario provincial portion). The Canada Revenue Agency (CRA) administers a rebate that returns a portion of that tax to eligible buyers. The federal component rebates 36% of the GST paid on homes priced up to $350,000 (maximum federal rebate: $6,300), phasing out entirely at $450,000. Ontario's provincial rebate tops up to 75% of the provincial HST portion, capped at $24,000. Combined, a client buying a $500,000+ new build can recover close to the full $30,000 maximum — numbers worth having ready before they ask.
What Changed — and Why It Matters for Your Pipeline
Previously, both the federal and Ontario rebates required the purchaser (or an immediate family member) to occupy the home as a primary place of residence. Investors, rental property buyers, and second-home purchasers were excluded entirely. The Ontario Ministry of Finance confirmed the one-year expansion removes that occupancy condition, aligning with the federal government's parallel move under the Excise Tax Act. For your business, that means every investor client who previously ruled out new construction because of the HST hit is now a live conversation again — a segment of your pipeline this rebate reopens.
Who Qualifies Under the Expanded Rules?
During the one-year window, a client qualifies if they purchase a brand-new home or substantially renovated home in Ontario directly from a builder. This now includes:
- Detached and semi-detached homes, townhouses, and condominiums
- Investment and rental purchase properties (previously excluded)
- Vacation or secondary residences
- Assignment sales of pre-construction units, where the original agreement falls within the eligible window
Resale homes remain ineligible — flag this early with clients who assume the rebate applies to any purchase. Clients buying new purpose-built rentals specifically benefit the most under this expansion, since they previously bore the full HST with no relief at all.
How Much Can Your Client Actually Save?
Savings scale with purchase price. On a $700,000 new condo, the HST owing is approximately $91,000 before any rebate. With the full combined rebate of up to $30,000 applied at closing, the net HST burden drops to roughly $61,000. The Building Industry and Land Development Association (BILD) estimates this relief directly offsets a significant share of developer-levied closing costs — a number that can strengthen your case when a client is weighing a new build against resale. For investor clients, the rebate improves first-year cash flow and lowers effective acquisition cost, which materially changes cap rate math on purpose-built rental units.
- Home under $350,000: Maximum federal rebate of $6,300 + up to $24,000 Ontario rebate
- Home $350,000–$450,000: Federal portion phases out; Ontario portion still applies
- Home over $450,000: No federal rebate; Ontario rebate capped at $24,000
How Does Your Client Claim the Rebate?
In most cases, the builder credits the rebate directly against the purchase price at closing — the buyer assigns their rebate entitlement to the builder, who handles the CRA Form GST190 filing on their behalf. If the builder doesn't apply it upfront, your client files Form GST190 (federal) and the Ontario equivalent directly with the CRA after closing. The filing deadline is two years from the date of possession. Tell clients to keep their Agreement of Purchase and Sale, closing statement, and proof of HST paid — all three are required if they file themselves.
Does the Rebate Apply to Pre-Construction Assignments?
Assignment sales sit in a grey zone. The Ontario Real Estate Association (OREA) recommends buyers on assignment deals confirm with a real estate lawyer that their specific agreement qualifies under the expanded rules. The critical date is typically the original purchase agreement date, not the assignment date — meaning some assignments signed before the policy announcement may still be eligible if possession falls within the window. Don't let a client assume the rebate applies without written confirmation from the builder and their lawyer.
How Long Does This Window Last?
The expanded eligibility runs for one year from the announcement date. The federal and provincial governments have not signalled a permanent extension, so treat the deadline as firm when you're setting a client's timeline. Builders and industry groups including CREA and BILD have lobbied for a permanent policy change, but for now, pre-construction units with occupancy dates beyond the window may not qualify — verify the closing timeline before a client signs.
What This Means for the Ontario Housing Market — and Your New-Construction Business
The expansion is widely viewed as a demand-side stimulus targeted at new construction. CMHC and Statistics Canada data consistently show new housing starts lag population growth in Ontario. By making new builds more financially attractive to investors and second-home buyers, the policy incentivises developers to break ground on projects that were previously stalled — and reopens a class of buyer who'd written off pre-construction entirely. Whether the one-year window translates into a meaningful uptick in starts depends on buyers acting decisively, which is exactly where being the agent who can explain this clearly, first, earns the call.
Save this page — it's built to send. Next time a client asks "does the HST rebate apply to me," you can forward this straight to them instead of retyping the same explanation. Orchestate's CRM and email tools make it a one-click share from any deal in your pipeline, so this becomes something clients get from you before they have to go looking for it themselves.
