Ontario Eliminates HST on New Home Construction — What Custom Home Buyers Need to Know
The Ontario government has eliminated the full 13% HST on eligible new construction homes, effective April 1, 2026. For homeowners planning a custom home build, this is one of the most significant financial developments in the residential construction market in years.
At Novacon Construction, we want to make sure our clients are informed and positioned to take full advantage of this opportunity.
The Key Facts
The rebate: Up to $130,000 back on the HST paid on a new home construction.
Who qualifies: Any eligible buyer — first-time and repeat buyers alike.
What qualifies: New builds only. Custom homes, pre-construction condos, townhomes, and unsold new inventory. Resale properties do not qualify.
The window: Purchase agreements must be signed between April 1, 2026 and March 31, 2027. Construction must begin by December 31, 2028 and be completed by December 31, 2031.
This window closes March 31, 2027. It will not come back.
Rebate Amounts by Purchase Price
| Purchase Price | Maximum Rebate |
|---|---|
| Up to $1,000,000 | Up to $130,000 |
| $1,000,000 – $1,500,000 | Capped at $130,000 |
| $1,500,000 – $1,850,000 | Partial rebate |
| Above $1,850,000 | Minimum $24,000 |
Additional Incentives for First-Time Buyers
First-time buyers can stack additional programs on top of this rebate:
- RRSP Home Buyers’ Plan — Withdraw up to $60,000 tax-free ($120,000 per couple) from your RRSP toward your first home
- First Home Savings Account (FHSA) — Save up to $40,000 with tax-free contributions and withdrawals
- TFSA savings — Can be applied to your down payment, tax-free
- Ontario Land Transfer Tax Rebate — Up to $4,000 back; an additional $4,475 for Toronto purchases
What This Means for Custom Home Clients
If you have been considering building a custom home in Toronto or the GTA, the combination of this rebate and existing incentive programs makes this one of the most financially advantageous moments to move forward.
For a custom home in the $1M–$1.5M range, the savings alone represent a significant reduction in your total project cost — and in some cases, enough to meaningfully change what’s possible within your budget.
Next Steps
This incentive applies to new builds — including custom homes built under a design-build contract. We strongly recommend speaking with your lawyer and accountant to confirm eligibility for your specific project.
If you have been thinking about building and want to understand how this rebate could affect your plans, we’re happy to have that conversation.
Schedule a consultation with Novacon Construction →
Subject to final federal legislation. Novacon Construction recommends working with a qualified lawyer and accountant to confirm eligibility. This article is intended as general information only and does not constitute financial or legal advice.
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