Ontario HST Rebate: Breaking Down the $8.8B Housing Plan

The Ontario housing market just received its most significant policy shift in decades. On March 30, 2026, the Office of the Prime Minister of Canada and the Government of Ontario officially signed the Canada–Ontario Partnership to Build.

This isn’t just another funding announcement; it is a tactical $8.8 billion roadmap designed to slash the “hidden costs” of homeownership. At Shrine Realty Brokerage, we believe this creates a unique “Buy Window” for our clients in London and across the province.

Here is what you need to know about the official government plan.

1. Massive Tax Relief: The HST Revolution

For the first time, the federal and provincial governments have aligned to provide direct tax relief on new construction. According to official statements from the Prime Minister’s Office, the goal is to make the dream of homeownership attainable again by removing the tax burden on middle-class housing.

100% HST Removal: The full 13% HST is being waived for newly built homes valued up to $1 million.
Tiered Rebates: If you are looking at a home between $1 million and $1.5 million, you can now access a rebate of up to $130,000.
The Savings Window: These specific measures apply to purchase agreements signed between April 1, 2026, and March 31, 2027.

2. Cutting Development Charges by 50%

One of the largest drivers of high home prices in Ontario has historically been municipal Development Charges (DCs). As part of this historic agreement, the federal Build Communities Strong Fund will provide $4.4 billion—matched by the province—to help municipalities offset these costs.

The catch? Only municipalities that commit to cutting their development charges by 30% to 50% for the next three years are eligible for the funding. For high-growth cities like London, this is a massive incentive to lower the upfront costs of building, which the government expects will be passed directly to the homebuyer.

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THE HST REBATE

Up to $1 Million

100% Rebate

The full 13% HST is completely waived, removing the entire tax burden upfront.

Maximum Impact

$1M – $1.5M

$130,000

A flat maximum rebate to ensure affordability remains strong in mid-tier markets.

$1.5M – $1.85M

Phase-Out

The rebate is maintained but decreases proportionally as the home value rises.

$1.85 Million+

$24,000 Min

Maintains the existing support floor, ensuring all new builds receive some relief.

3. Why London, Ontario is a Priority

This agreement specifically prioritizes “high-growth cities where housing shortfalls are most acute.” London remains one of the fastest-growing regions in Canada, and this $8.8 billion investment is geared toward the “housing-enabling infrastructure”—roads, water, and transit—required to support the 8,000 additional homes slated for the next 12 months.

Investing in a new build in London right now doesn’t just mean getting a modern home; it means benefiting from a government-subsidized reduction in overall project costs that could save you up to $200,000 in total taxes and fees.

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Support for Rental Housing & Infrastructure

Beyond homebuyers, the province is also taking steps to strengthen the rental market:

Rental Housing

8% HST Removed

Removal of the provincial portion of HST on purpose-built rental housing.

Infrastructure Program

$4 Billion

Investment through the Municipal Housing Infrastructure Program.

Building Faster Fund

$1.2 Billion

Investment to accelerate development and increase housing supply across Ontario.

These initiatives aim to accelerate development and increase housing supply across Ontario.

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What This Means for Buyers & Investors

This expanded HST rebate creates a unique window of opportunity:

For Buyers

Upfront Savings

Buyers can benefit from significant upfront savings on new homes.

For Investors

Improved Returns

Investors gain improved returns on new construction purchases.

For Builders

Increased Inventory

Builders & developers receive incentives to increase overall housing inventory.

In markets like London and across Ontario, this could translate into increased activity, better affordability, and stronger long-term growth.

The Shrine Realty Strategy

Ontario’s expanded HST rebate is more than a policy update—it’s a powerful step toward making homeownership more attainable while fueling economic growth. With substantial savings on the table and a limited timeframe, buyers and investors should start planning early to take full advantage of this opportunity.

If you’re considering buying a new home or investing in pre-construction, now is the time to exploreyour options and position yourself strategically in the market.

Big Wins for Ontario Homebuyers: Breaking Down the $8.8B Federal-Provincial Partnership