Up to $130,000 Back on a New Build

On March 25, 2026, the Ontario government announced the most significant change to new-home taxation in the province's history. For a strict twelve-month window, buyers signing an Agreement of Purchase and Sale (APS) with a builder can qualify for a combined federal and provincial HST rebate worth up to $130,000.

Here's how the tiers break down: homes priced up to $1 million qualify for the full 13% HST rebate. Homes between $1 million and $1.5 million still receive the flat $130,000 maximum. Above that, between $1.5 million and $1.85 million, the rebate phases down on a sliding scale to the old $24,000 provincial cap. Past $1.85 million, only the legacy $24,000 rebate applies.

For context on what this replaces: before this program, the most a buyer could typically recover was $24,000, and only on homes priced under $450,000. Most move-up and luxury new-build buyers in our market received nothing. This is a real structural shift — not a minor adjustment.

Your Signing Date Is the Hard Eligibility Trigger

This rebate only applies to Agreements of Purchase and Sale signed between April 1, 2026, and March 31, 2027. That's it — there's no flexibility built into this date.

It's the date both parties sign the APS that counts. Not the date you removed a financing or inspection condition. Not your deposit date. Not your occupancy date. If your agreement is dated even one day outside that window, the old, much smaller rebate rules apply instead.

This also matters for assignment purchases. If you're buying an assignment, it's the original APS between the first buyer and the builder that determines eligibility — not the date you signed your assignment agreement. And separately, HST on the assignment premium itself is never covered by this rebate, regardless of the underlying property's eligibility.

Builders Are Not on the Same Page

This is the part that doesn't make the headlines. Because the federal portion of this rebate still requires Royal Assent on amendments to the Excise Tax Act, builders across Ontario are pricing and structuring contracts differently while that uncertainty plays out.

Some builders are crediting the savings directly on your statement of adjustments at closing — meaning you never pay the HST upfront on that portion. Others are requiring you to pay the full HST at closing and apply to the CRA yourself afterward, which means a buyer needs to have that extra cash available temporarily, even though the rebate is ultimately recoverable.

We're watching this inconsistency play out with builders right here in London and Middlesex County. There is no single standard yet, which is exactly why the contract clauses matter so much right now.

The Exact Questions to Ask Your Builder

Before you put pen to paper on an Agreement of Purchase and Sale, get clear answers — in writing — on the following:

Is the rebate being credited to you directly at closing, or are you expected to apply to the CRA afterward? If it's the latter, are you financially prepared to carry that HST amount temporarily? What does the contract say happens if the federal legislation isn't finalized by your closing date? And what are the specific construction start and completion deadlines tied to your unit, in writing?

What This Means for Our Market Right Now

As of May 2026, the MLS® HPI composite benchmark price for London and St. Thomas sits at $570,000 — up slightly month-over-month, but still 4.4% below where it stood a year ago. The market carried 4.3 months of inventory in May, with a sales-to-new-listings ratio of 42.8%, which keeps us in buyer-favourable territory. That backdrop matters here: a rebate this size on new construction could meaningfully shift some buyers from resale toward new build, particularly for anyone weighing the two paths in the months ahead.

Nationally, the Bank of Canada has held its overnight rate steady through its most recent announcements, which has kept borrowing costs relatively stable while this rebate window plays out. Combine a flat-rate environment with a one-time tax incentive of this size, and the next twelve months become a genuinely unusual window for new-construction buyers in our market — provided the contract is structured correctly from day one.