Based on coverage from CBC, Global News, The Globe and Mail, The Toronto Star, and The Toronto Star.
Ontario’s Progressive Conservative government is teeing up a one-year HST break for buyers of new homes and condos, expanding a rebate that, until now, focused mainly on first-time buyers. Premier Doug Ford announced the plan in Mississauga, pitching it as a way to kick-start homebuilding during a slow patch for sales and new construction.
This initiative aligns with recent efforts to enhance housing affordability, such as the federal government's New Build Canada Homes Initiative, aimed at increasing the availability of affordable housing across the country.
The proposal is expected to show up in Finance Minister Peter Bethlenfalvy’s provincial budget, set to be tabled March 26.
Ontario HST rebate for new homes
Ontario says it will temporarily remove the full 13 per cent Harmonized Sales Tax on new homes valued up to $1 million for purchases made between April 1, 2026, and March 31, 2027. That’s a maximum rebate of up to $130,000, according to the province.
Multiple reports describe the change as an expansion of last fall’s policy, which was tied to first-time buyers. The new version would apply more broadly, with eligibility also covering homes bought as a primary residence or as a residential rental property.
Who qualifies and how much
Beyond the under-$1-million headline, the province says buyers of more expensive new homes would still get relief:
- Homes valued up to $1.5 million would remain eligible for the maximum $130,000 rebate. - The rebate would then shrink on a sliding scale, down to $24,000 at $1.85 million or more.
The government also attaches construction timing requirements. The Star reports purchase agreements must be signed between next Wednesday and March 31, 2027, and that construction for primary residences must begin by Dec. 31, 2028, and be substantially completed by Dec. 31, 2031. For rental units, the completion deadline is earlier: Dec. 31, 2029, which the Star says is tied to a “glut” of vacant units sitting on the market.
Federal government cost-sharing with Ontario
Ontario says Ottawa has agreed to cover the federal five per cent portion of the HST, at least once legislation is in place. The Star puts a number on it: $875 million from the federal government, with Ontario covering nearly $1.4 billion, for a combined package worth about $2.2 billion in tax relief.
Other coverage describes the federal support more generally, saying it would “approximately” cover Ottawa’s share.
Housing starts target and market slump
Queen’s Park is betting the tax break will translate into more cranes and concrete. The province estimates it could stimulate about 8,000 additional housing starts and support up to 21,000 jobs, with a claimed $2.7 billion boost to Ontario’s GDP growth.
That’s the backdrop to a bigger problem: Ontario is well behind its goal of building 1.5 million homes by 2031. Global News cites 62,561 housing starts in 2025, while other reporting cites just over 67,000. Either way, the point is the same: the pace is far below what would be needed to hit the target, and even the government’s own projections (as cited by The Canadian Press) have Ontario building about 70,000 new homes this year.
Global News also reports the earlier first-time-buyer-focused rebate didn’t spark the market the way the government hoped, which is why the new plan would widen the pool of eligible buyers.
Political reaction and budget pressure
The NDP’s Marit Stiles has argued the measure may help some buyers but won’t fix the deeper issue of not building enough homes, especially affordable ones.
There’s also a straight-up fiscal question. Global News reports development industry sources were told a broader HST waiver could cost around $2 billion, versus the earlier $470 million plan limited to first-time buyers. The same reporting points to a $236 billion provincial budget, a $13.4 billion deficit, and debt projected to pass $500 billion by 2027.
For buyers, the next practical detail is timing: the rebate window doesn’t start until April 2026, and the final shape of the program still depends on the budget and legislation that follows.
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