First-Time Home Buyers' GST Rebate: Pay $0 GST in 2026

If you're a first-time buyer eyeing a brand-new home in Waterloo Region, there's a change to the rules that could put tens of thousands of dollars back in your pocket. The new federal First-Time Home Buyers' GST Rebate can wipe out the 5% federal GST on a qualifying new home entirely — meaning an eligible buyer pays $0 federal GST on a new build priced up to $1,000,000. Here's the plain-English version of how it works, who qualifies, and why it matters so much right now if you're looking at a new build or pre-construction home in Kitchener-Waterloo.

What the rebate actually does

New homes come with GST attached. When you buy a resale house, there's no GST on the purchase price — but a newly built home from a builder does carry the 5% federal GST (or the 5% federal portion of HST). That's a real cost that has always made new builds a bit more expensive than they look on the sticker.

The First-Time Home Buyers' (FTHB) GST/HST Rebate removes that 5% federal GST for eligible first-time buyers, up to a maximum of $50,000. It stacks on top of the existing GST/HST New Housing Rebate, so a qualifying first-time buyer effectively pays $0 federal GST on a new home priced up to $1,000,000. In practical terms, that's up to $50,000 of tax relief that simply wasn't available before.

Exactly how much you get

The full rebate applies to qualifying homes priced up to $1,000,000. Above that, it phases out gradually rather than disappearing all at once:

• Up to $1,000,000 — full rebate (up to the $50,000 maximum).
• Between $1,000,000 and $1,500,000 — a linear phase-out. The rebate rate is calculated as ($1,500,000 − price) ÷ $500,000.
• $1,500,000 or above — no rebate.

A worked example makes the phase-out concrete. Say a new home is priced at $1,250,000. Plug it into the formula: ($1,500,000 − $1,250,000) ÷ $500,000 = 50%. So that buyer would qualify for 50% of the rebate — up to $25,000. The higher the price climbs toward $1.5 million, the smaller the rebate, until it reaches nil.

For most first-time buyers shopping in Waterloo Region, where plenty of new townhomes and condos are priced under the $1,000,000 mark, the full benefit is well within reach.

Who counts as a "first-time home buyer"

The definition here is specific, and all of the following need to be true for you to qualify:

• You're at least 18 years old.
• You're a Canadian citizen or permanent resident.
• You haven't lived in a home that you — or your spouse or common-law partner — owned, in or outside Canada, as your primary residence in the current calendar year or the previous four calendar years.
• Neither you nor your spouse or common-law partner has previously received an FTHB GST/HST rebate. It's a once-per-lifetime benefit.

On top of that, the home has to be your primary residence, and you must be its first occupant. So this is aimed squarely at people buying a new home to live in, not at investors or buyers picking up a second property.

One thing worth highlighting: the "previous four calendar years" test is about not having owned and lived in a home recently. Plenty of people who owned years ago, or who've been renting, may find they qualify even if they wouldn't think of themselves as first-timers in the everyday sense.

What counts as a "new home"

The rebate uses the same definition of a qualifying home as the existing New Housing Rebate. That covers:

• A newly built or substantially renovated home bought from a builder (this includes certain long-lease land arrangements).
• An owner-built or substantially renovated home.
• A share in a co-operative housing corporation.

Importantly, a pre-construction purchase from a builder counts as a new home — so buying that townhome or condo off the plans, before it's built, can qualify. What does not qualify is a resale home, and that's fine, because there's no GST on a resale purchase to begin with. This rebate is entirely about new construction.

The key dates

Timing matters, and the CRA has confirmed three deadlines that all need to line up:

• Your agreement of purchase and sale with the builder must be entered into on or after March 20, 2025.
• Construction must begin before 2031.
• Ownership must be transferred to you before 2036.

If you've seen an earlier date floating around online, note that the agreement date is March 20, 2025 — an earlier proposal date that circulated was later amended, so go by the confirmed figure.

How it stacks with the rebates you may already know

The existing federal GST/HST New Housing Rebate already refunds 36% of the 5% GST, to a maximum of $6,300, and it phases out between $350,000 and $450,000. The new FTHB rebate tops that up — for eligible first-time buyers, it takes the relief all the way to 100% of the federal GST on homes up to $1 million. Think of the old rebate as a partial discount and the new one as the piece that finishes the job for first-timers.

The Ontario side of the picture

Ontario has its own layer, and it's genuinely generous — but the details were still settling in mid-2026, so treat the specifics as something to confirm rather than bank on.

First, the existing provincial HST New Housing Rebate — 75% of the 8% provincial portion, to a maximum of $24,000 — still applies to new homes, whether or not you're a first-time buyer. The CRA also confirms there's an Ontario FTHB rebate that acts as a top-up to the existing provincial new housing rebate, and it can be claimed at the same time as the federal FTHB rebate.

On top of all that, Ontario's 2026 Budget introduced a temporary Enhanced New Housing Rebate that raises provincial relief to up to $80,000. Unlike the FTHB rebates, this enhancement is for all eligible buyers, not just first-timers. It comes with a limited window — agreements signed roughly between April 1, 2026 and March 31, 2027 — plus specific construction deadlines. Because it's temporary and the fine print and forms were still being finalized, the smart move is to confirm the current details and dates directly with the CRA or Ontario before you count on it.

Add the federal and Ontario measures together during the overlap and the combined relief on a qualifying new home can total well over $100,000 — but that's very much an "up to" figure that depends on price, timing, and your personal eligibility. It's exactly the kind of number worth confirming with a professional before you make decisions around it.

Why this matters right now in Waterloo Region

Here's the local hook. New homes attract GST that resale homes don't, and that tax has always tilted the math against new builds for first-time buyers. This rebate changes that math. If you're weighing a brand-new townhome, a pre-construction condo, or a freshly built house in Kitchener-Waterloo, the effective cost just came down in a meaningful way — potentially by tens of thousands of dollars once the federal and provincial pieces are in play.

For anyone who's been comparing a new build against a resale option and feeling like the new home was priced out of reach, it's worth running the numbers again with these rebates factored in. The gap may be a lot smaller than you think, and a new home comes with its own advantages — warranties, modern efficiency, and nothing to renovate on day one.

If you'd like help figuring out whether a new build makes sense for your budget, our team is happy to walk through it with you. You can start with our first-time buyer hub for the bigger picture, or browse current listings across Waterloo Region to get a feel for what's out there.

A quick word before you count your savings

This article is general information, not tax or legal advice. Rebate rules change, and eligibility depends on your individual circumstances. Before you make any decisions, please confirm your eligibility and the current details with the Canada Revenue Agency or a qualified tax or legal professional.

Ready to see what a new home could look like for you? Get in touch with our team and we'll help you weigh your options — or if you're also selling first, request a free home valuation to understand where you stand. We'd love to help you make the most of this new opportunity.