Buying your first home is a major milestone, and now, thanks to a new government measure announced on May 27, 2025, it just got more affordable for Canadians entering the market for the first time.
To help lower the upfront costs and encourage new construction, the federal government is eliminating the 5% GST for first-time buyers purchasing new homes priced up to $1 million. For homes priced between $1 million and $1.5 million, a partial rebate will apply.
Let’s break it down:
What Is the FTHB GST Rebate?
The First-Time Home Buyers’ GST Rebate (FTHB GST Rebate) is a new federal program that allows qualifying buyers to recover some or all of the GST paid on a newly built home, including:
- Homes purchased directly from a builder
- Owner-built homes
- Shares in a co-operative housing corporation
The goal is simple: make homeownership more attainable for Canadians taking their first step into the market.
How Much Can You Save?
- 100% GST rebate on new homes up to $1 million (that’s a savings of up to $50,000)
- Partial rebate on homes between $1 million and $1.5 million (phased out linearly)
- No rebate on homes priced at $1.5 million or more
Example:
If you buy a home worth $1.25 million, you’d receive 50% of the GST back, or a rebate of up to $25,000.
Who Qualifies?
To be eligible, you must:
- Be at least 18 years old
- Be a Canadian citizen or permanent resident
- Not have owned a home (in Canada or abroad) in the current calendar year or the four preceding years
- Use the property as your primary residence
- Be the first occupant of the home
Important: You can only claim this rebate once in your lifetime, and your spouse/common-law partner must not have claimed it either.
When Does It Apply?
You may qualify if:
- You sign a purchase agreement on or after May 27, 2025 and before 2031
- The home’s construction begins before 2031 and is substantially complete before 2036
Important: Assignment sales won’t qualify unless the original agreement was also signed on or after May 27, 2025.
What About Owner-Built Homes or Co-ops?
The rebate also applies if you build your own home (or hire someone to build it) or purchase shares in a housing co-op, as long as you meet the same conditions and the home will be your primary residence.
Final Thoughts
This is a huge win for first-time buyers who’ve been feeling priced out of the market, especially in cities like Vancouver where new construction can come at a premium.
If you’re considering buying a new home or want to understand how this rebate could work for you, I’d love to walk you through it. Whether you’re just starting your search or getting ready to buy, it’s important to know what incentives you can benefit from.
Let’s connect and see how we can make your first home purchase more affordable.
Denisse Moran (778) 223-6399
