🚨 Budget Update — March 26, 2026
The 2026 Ontario Budget has officially confirmed the historic expansion of the HST rebate to all buyers. For agreements signed between April 1, 2026 and March 31, 2027, the combined rebate is worth up to $130,000. This is currently proposed legislation within the budget bill — we will update this article the moment it receives Royal Assent.
In a move that housing analysts are calling the most significant affordability intervention in a generation, the Ontario government announced today that it will expand the HST rebate on newly built homes to cover all buyers — no longer restricted to first-time homebuyers. In partnership with the federal government, which has agreed to cost-share the program, eligible buyers who sign a purchase agreement between April 1, 2026 and March 31, 2027 could see a combined tax rebate of up to $130,000 on new homes priced up to $1.5 million.
Here's everything confirmed so far — including the price tiers, phase-out formula, what remains to be legislated, and exactly what this means for Ontario new development buyers right now.
How exactly does the new Ontario HST Expansion work?
The Ontario HST Expansion is a temporary, one-year program announced by the Ford government on March 25, 2026. It extends the existing new housing HST rebate — which previously capped out at $24,000 and was available only to specific buyers — to virtually all purchasers of new builds. The rebate is available on both the provincial portion (8% PST) and, through a federal partnership, the federal portion (5% GST) of the HST.
The combined maximum rebate is $130,000, split roughly as $65,000 federal and $65,000 provincial on a home valued at $1.5 million. The program applies to agreements of purchase and sale signed on or after April 1, 2026 and on or before March 31, 2027.
🔗 Official Source
This article is based on the official Government of Ontario press release. Read the Ontario Newsroom announcement →
Who is eligible for the expanded $130,000 rebate?
Who Qualifies?
Unlike 2026 Housing Legislation's federal rebate — which requires New Home Buyer status — the Ontario HST Expansion is open to all individuals purchasing a qualifying new home. There is no New Home Buyer requirement. Move-up buyers, returning buyers, and investors purchasing a new build as a primary residence or residential rental property are all expected to qualify.
- You do not need to be a New Home Buyer
- The home must be a newly constructed or substantially renovated residential property
- The home must be intended as a primary residence or residential rental property
- Your Agreement of Purchase and Sale (APS) must be signed between April 1, 2026 and March 31, 2027
- Resale homes do not qualify — only new builds and substantial renovations
⚠️ Important: Rental Properties Now Eligible
In a meaningful expansion of the program's scope, new builds purchased as residential rental properties are included in the Expansion — not just owner-occupied primary residences. This is a significant shift from previous HST rebate rules that have historically been more restrictive for investors.
Construction Timeline Requirements
- If construction begins between April 1, 2026 and December 31, 2028: substantial completion must occur by December 31, 2031
- If construction began before March 31, 2026: your APS must still be signed within the April 1–March 31, 2027 window, and substantial completion must occur by December 31, 2029
How much can I save at different price points?
The Ontario HST Expansion uses a three-tier rebate structure based on purchase price. Here's exactly how it breaks down:
Tier 1: Up to $1,500,000 — Full $130,000 Rebate
For new homes priced up to $1.5 million, the rebate is the full 13% HST — effectively eliminating all HST on the purchase. The combined federal and provincial rebate totals $130,000 at the maximum.
| Purchase Price | Est. Federal Rebate | Est. Ontario Rebate | Total Rebate |
|---|---|---|---|
| $600,000 | ~$30,000 | ~$48,000 | ~$78,000 |
| $800,000 | ~$40,000 | ~$64,000 | ~$104,000 |
| $1,000,000 | ~$50,000 | ~$80,000 | ~$130,000 |
| $1,250,000 | ~$62,500 | ~$67,500 | ~$130,000 |
| $1,500,000 | ~$75,000 | ~$55,000 | $130,000 (Max) |
*Estimates only. Subject to final enacted legislation detailing exact federal vs. provincial split. Use our updated HST Rebate Calculator for a precise figure.
Tier 2: $1,500,000 to $1,850,000 — Linear Phase-Out
For homes priced between $1.5M and $1.85M, the rebate reduces proportionally and gradually — this is not a cliff. The rebate slides from $130,000 at $1.5M down to $24,000 at $1.85M, decreasing at a rate of approximately $303 per $1,000 increase in price.
The official phase-out formula is:
Rebate = $130,000 − ((Purchase Price − $1,500,000) × ($106,000 ÷ $350,000))
| Purchase Price | Rebate (Est.) | Reduction from Max |
|---|---|---|
| $1,500,000 | $130,000 | $0 |
| $1,600,000 | ~$99,714 | ~$30,286 |
| $1,700,000 | ~$69,429 | ~$60,571 |
| $1,800,000 | ~$39,143 | ~$90,857 |
| $1,849,999 | ~$24,001 | Just above floor |
Tier 3: $1,850,000 and Above — $24,000 Floor
For homes priced at $1.85M or above, the Ontario Expansion rebate reaches its floor: a maximum of $24,000. This is equivalent to the existing legacy Ontario HST rebate that has been in place for years. The enhanced elements of the program do not apply above this price point. The rebate does not continue to reduce — it simply stays at $24,000 regardless of how much higher the price goes.
What Is Still TBD — What We Don't Know Yet
⚠️ Status as of March 27, 2026: Confirmed in Budget
- ✅ Ontario government announcement: Completed Mar 25
- ✅ Budget tabling: Completed Mar 26
- ⏳ Budget passage (Royal Assent): Pending
- ⏳ Federal GST cost-sharing bill: Pending introduction
- ❓ Builder assignment clauses: How builders will apply the $130K credit at closing remains the largest TBD
The Ontario government has stated the Expansion is to begin on April 1, 2026 — which is less than one week away. Given the compressed timeline, buyers, builders, and lawyers are all operating with incomplete information. It is possible that administrative details (forms, regulations, assignment procedures) will lag behind the effective date.
What This Means for Ontario New Development Buyers
If You're Actively Shopping Now
If you're in the market for a new build and your purchase agreement would be signed on or after April 1, 2026, this announcement materially changes your financial picture. A buyer purchasing a $900,000 new build under the Expansion rules could see a rebate of approximately $117,000 — versus $24,000 under the previous rules. That's a difference of $93,000 that directly reduces your net cost of homeownership.
If You've Already Signed a Pre-Construction Agreement
If your Agreement of Purchase and Sale was signed before April 1, 2026, the Ontario Expansion does not apply retroactively. Your applicable rebate is governed by whichever rules were in effect at the time of your agreement. New Home Buyers with agreements signed on or after March 20, 2025 still benefit from 2026 Housing Legislation's federal rebate. Check your APS and confirm with your lawyer exactly how your HST assignment clause works.
If You're Considering Signing April 1 or Later
Be aware that builders may reprice inventory to reflect the reduced net cost to buyers. Watch for whether the listed price you see is inclusive or exclusive of the HST rebate — this distinction has a direct impact on how much of the $130,000 benefit actually flows to you versus to the builder. Always ask: "Is this price net of the full HST rebate under the Ontario Expansion?"
How to Navigate This With the Right Professionals
Your Real Estate Lawyer: The Most Important Call Right Now
Given that this legislation has not yet been enacted and the effective date is imminent, your real estate lawyer is the frontline resource for clarity. Specifically, ask them to confirm:
- How the HST assignment clause in your APS will need to be updated for a post-April 1, 2026 agreement
- Whether the builder is positioning the price as inclusive or exclusive of the Expansion rebate
- What documentation will be required to apply for the rebate once forms are updated by CRA
- The impact on your development charge and levies cap if revisiting a pre-construction deal
Your New Development Realtor: Navigate the Reprice
Not all builders will immediately pass the savings of the rebate expansion to buyers in the form of lower prices. Market conditions, builder margins, and sales velocity targets all influence how developers respond to a program like this. A new development specialist who works directly with builders and understands how pricing models are structured will help you navigate pricing transparency quickly — especially if you're moving fast to sign before the window closes on March 31, 2027.
Your Mortgage Broker: Recalculate Your Purchase Power
The Ontario Expansion effectively reduces your net cost of homeownership, which has downstream implications for your financing structure. If the rebate flows to you (rather than the builder), you may be able to reconsider your down payment allocation, CMHC insurance tier, or overall budget ceiling. Update your mortgage broker on any homes you're actively considering — the numbers may look different than they did even a week ago.
| Professional | What to Ask Them | Why It Matters |
|---|---|---|
| Real Estate Lawyer | HST assignment clause wording for post-Apr 1 agreements | Determines if rebate flows to you or builder |
| New Dev Realtor | Is the listed price net of the Expansion rebate? | Pricing transparency distinguishes true savings |
| Mortgage Broker | How does the rebate affect my financing plan? | Could change down payment, CMHC tier, purchase ceiling |
| Tax Professional | How should I handle the rebate on my T1 in the closing year? | Rebate amounts may have specific tax reporting implications |
The Ontario Expansion vs. 2026 Housing Legislation: Key Differences
| Feature | 2026 Housing Legislation (Now Law) | Ontario HST Expansion (Proposed) |
|---|---|---|
| Buyer eligibility | New Home Buyers only | ALL buyers |
| Max rebate | ~$50,000 federal | $130,000 combined |
| Full rebate up to | $1,000,000 | $1,500,000 |
| Phase-out ends at | $1,500,000 ($0 rebate) | $1,850,000 ($24K floor) |
| Rental property eligible | No | Yes |
| Status | Law (as of Mar 12, 2026) | Proposed — budget Mar 26 |
| APS date window | Mar 20, 2025 – Dec 31, 2030 | Apr 1, 2026 – Mar 31, 2027 |
New Home Buyers signing in the April 1, 2026–March 31, 2027 window qualify for both programs simultaneously. For FTHB in that window, the Ontario Expansion supersedes the C-4 rebate since it offers a larger combined rebate on homes up to $1.5M, and extends meaningful relief further up the price curve.
Calculate Your Exact Rebate
Our HST Rebate Calculator has been updated to reflect the Ontario HST Expansion announcement. Enter your purchase price and agreement date to see your estimated rebate under all applicable scenarios — instantly, with no login required.
Open HST Rebate Calculator →How do I know if my builder is keeping the rebate?
Check your Agreement of Purchase and Sale for an "HST Assignment" clause. If the price is "inclusive of HST," the builder usually keeps the rebate. Ask your lawyer if you can negotiate a "net-of-rebate" price to capture the $130,000 yourself.
What is the deadline to sign a contract to get this rebate?
You must sign your Agreement of Purchase and Sale between April 1, 2026, and March 31, 2027, to qualify for the enhanced $130,000 cap.
Ready to Invest in Your Future?
The Ontario HST Expansion changes the math on new development purchases dramatically. Getting the right guidance — the right realtor, lawyer, and mortgage professional — is the difference between capturing every dollar of this rebate and leaving it in the builder's pocket.
Updated March 25, 2026 — We monitor all legislative developments in real time.
Official Sources: Government of Ontario Newsroom (Mar 25, 2026), Department of Finance Canada, CRA, Parliament of Canada. This article is for educational purposes and does not constitute legal or financial advice.
About the Author
Nicole Copp is a licensed real estate professional and new development specialist focused on helping Ontario buyers navigate government programs, builder incentives, and the pre-construction purchase journey.