New-home sales across the GTA have slowed this year. However, a recent proposal from Premier Doug Ford is bringing renewed optimism to the market. Ford suggested expanding the hst tax break, currently offered only to first-time buyers to anyone purchasing a new home. The idea is gaining attention because it may support affordability, encourage movement, and restore confidence during a slow period.

A Shift That Matches Today’s Market Needs

This discussion comes at a crucial time. According to Altus Group, only 438 new homes were sold in September. That number is 80 per cent below the 10-year average and shows how much the market has cooled. As a result, builders are carrying more inventory, and projects are progressing at a slower pace. Expanding the hst tax break could bring some needed energy back into the sector.

Ford also pointed out that stalled inventory affects more than builders. When fewer homes sell, trades, suppliers, and municipalities all feel the impact. Therefore, a wider incentive could help support the many industries connected to new construction.

Understanding the Current Rebate Structure

The current rebate applies only to first-time buyers who purchase a new home priced up to $1 million. It combines both federal and provincial tax relief and can offer savings of up to $130,000. Although helpful, the program supports only a small group of buyers. Expanding the incentive would reach a much wider range, including move-up buyers, downsizers, and investors.

Housing researcher Mike Moffatt explained that HST is charged only on new homes, not on resales. Because of this, new builds often appear less competitive. Expanding the rebate would help narrow that gap and create more balance across the market.

Growing Support From the Industry

The construction sector has responded positively. In fact, the Ontario Home Builders Association has encouraged the province to consider removing the provincial portion of the HST entirely. They believe this move could protect thousands of construction jobs and help builders move ahead with new projects in 2026 and beyond. Additionally, they argue that lower costs would make existing inventory more attractive to buyers.

Their message reflects a broader theme: any relief that improves affordability could support a healthier and more stable market.

What This Change Could Mean for Buyers and Investors

If expanded, the hst tax break could make new homes more accessible to a larger group of buyers. This may include families looking for more space, investors exploring pre-construction developments, or downsizers seeking modern, efficient homes. Lower closing costs would make these options more appealing, especially in growing communities like Vaughan, Markham, Richmond Hill, and North York.

For example, a buyer who has been waiting for prices to settle might feel more confident moving forward. With the possibility of meaningful tax savings, the decision to purchase a new home becomes easier. Furthermore, increased activity would help builders plan ahead with greater certainty.

Looking Toward the Months Ahead

Whether or not the proposal moves forward, the discussion highlights a stronger focus on affordability and long-term stability. More choice, more movement, and more confidence all contribute to a healthier real estate environment. As Ontario continues to adjust to shifting market conditions, policies like this may play an important role in shaping the next phase of growth.

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