What Ottawa buyers need to know about the new 2026 HST relief

If you’ve thought buying a new home is out of reach, there is an important reason to take another look at the numbers in 2026.

The federal government and Ontario have introduced significant new HST relief measures for qualifying new homes.

You may have seen headlines mentioning up to $130,000 in HST relief.

That number is real — but it does not mean every first-time buyer will receive $130,000.

The actual benefit depends on the purchase price, the type of home, the timing of the transaction, the buyer's eligibility and how the federal and Ontario programs interact.

Let's look at a hypothetical Ottawa couple to see how these measures could work.

Meet Alex and Jordan

Alex and Jordan are in their late 20s. They both work and have been renting in Centretown for several years.

They had always assumed they would need to wait a few more years before buying.

Then they found a new-build townhome in Ottawa priced at $650,000.

Instead of simply looking at the purchase price and monthly mortgage payment, they decided to find out how the new HST rules could affect their overall cost.

Here's what they learned.

Step 1: First, determine whether you qualify

Being a renter doesn't automatically make someone a first-time home buyer for purposes of the federal rebate.

The federal First-Time Home Buyers' GST/HST rebate has specific eligibility requirements.

Generally, an eligible buyer must be at least 18 years old, be a Canadian citizen or permanent resident, and meet the program's first-time buyer test.

For example, the rules generally consider whether the buyer, or their spouse or common-law partner, owned and lived in a home during the calendar year in which the new home is purchased or the preceding four calendar years.

There are additional requirements concerning the home, the purchase and occupancy.

So before assuming you qualify, it's important to check the current CRA requirements.

CRA — First-Time Home Buyers' GST/HST Rebate

Step 2: Understand the federal first-time buyer rebate

The federal First-Time Home Buyers' GST/HST rebate can provide an eligible first-time buyer with a rebate of up to $50,000 on the GST or federal portion of HST.

For a qualifying new home valued at $1 million or less, the federal first-time buyer rebate can effectively recover 100% of the GST or federal 5% portion of HST, subject to the program's requirements.

For homes valued between $1 million and $1.5 million, the federal rebate is gradually reduced.

At $1.5 million or more, the federal first-time buyer rebate is not available.

For Alex and Jordan, their $650,000 townhome is below the $1-million threshold.

But that's only one part of the calculation.

Step 3: Ontario has its own HST relief

Because Alex and Jordan are buying in Ontario, they also need to understand the provincial portion of HST.

Ontario's Enhanced New Housing Rebate (ENHR) temporarily increases the available Ontario new housing rebate for qualifying homes.

For a qualifying home valued at up to $1 million, the Ontario ENHR can provide relief equal to 100% of the 8% provincial portion of HST, up to a maximum of $80,000.

For homes purchased from a builder, the temporary enhanced program applies to qualifying agreements entered into between April 1, 2026 and March 31, 2027, subject to the other program requirements.

For homes above $1 million, different rules apply.

This is why buyers shouldn't assume that the same rebate amount applies to every new home.

Step 4: Where does the $130,000 figure come from?

This is the part that has attracted the most attention.

Ontario's temporary measures also include the Ontario New Home Affordability Payment (ONHAP).

For someone eligible for the Ontario ENHR, the ONHAP can provide up to $50,000, representing up to 100% of the federal 5% portion of HST.

When you combine:

Up to $80,000 in Ontario provincial HST relief

plus

Up to $50,000 in Ontario New Home Affordability Payment

you get:

Up to $130,000

The $130,000 figure is therefore a legitimate maximum under the Ontario temporary measures.

The federal government has also described the temporary expanded HST relief as providing up to $130,000 off the cost of a qualifying new home.

But there is an important catch for first-time buyers.

The ONHAP is reduced by the federal portion of any GST/HST new housing rebate or First-Time Home Buyers' GST/HST rebate to which the buyer is entitled.

In other words, you cannot simply take every maximum number and add them together for a first-time buyer.

CRA specifically explains that a first-time buyer must claim the federal first-time buyer rebate first when determining the ONHAP amount.

So what could this mean for Alex and Jordan?

Let's use their $650,000 townhome as an illustration.

At 13% HST:

5% federal portion: $32,500

8% Ontario portion: $52,000

Total HST: $84,500

If Alex and Jordan qualify for the applicable first-time buyer and Ontario programs, the calculation could look approximately like this:

Federal first-time buyer relief

Up to $32,500

Because 5% of $650,000 is $32,500.

Ontario provincial HST relief

Up to $52,000

Because 8% of $650,000 is $52,000.

Ontario New Home Affordability Payment

The ONHAP can be up to $50,000, but it is reduced by the federal first-time buyer rebate.

In this example:

$50,000 maximum ONHAP

minus

$32,500 federal first-time buyer rebate

=

up to $17,500 remaining ONHAP

Potential total relief in this example:

$32,500 federal

• $52,000 Ontario provincial

• $17,500 ONHAP

=

Up to $102,000

This is an illustration, not a promise of a $102,000 rebate. Alex and Jordan would still need to satisfy all applicable eligibility requirements and confirm the treatment of the particular purchase.

The calculation demonstrates why it is important to look at the interaction between the programs rather than simply adding the headline maximums.

CRA confirms that the total Ontario provincial rebate cannot exceed the applicable provincial HST paid or payable, and that ONHAP is reduced by the federal GST/HST rebate available to the individual.

Step 5: Why you shouldn't simply assume you'll receive $130,000

This is probably the most important takeaway for buyers.

You may see:

$50,000 federal

+ $80,000 Ontario

= $130,000

But that isn't how every buyer's calculation works.

The $130,000 figure reflects the maximum potential combination of certain Ontario measures in qualifying circumstances.

For a first-time buyer, the federal First-Time Home Buyers' GST/HST rebate can reduce the amount available through the ONHAP.

The amount of HST actually payable also matters.

For example, on a $650,000 home, there is only $84,500 of total HST before rebates.

A rebate cannot exceed the applicable tax amount to which the rebate relates.

That's why the purchase price and the buyer's circumstances matter.

Step 6: The date you sign can matter

Timing is another important consideration.

The federal First-Time Home Buyers' GST/HST rebate has its own eligibility and timing rules.

Ontario's temporary Enhanced New Housing Rebate has a specific purchase agreement window.

For qualifying purchases from a builder, the Ontario ENHR generally applies to agreements entered into between April 1, 2026 and March 31, 2027, subject to the program's other requirements.

So if you're considering a new-build home, don't wait until closing to ask about HST.

Ask before you sign the Agreement of Purchase and Sale.

Step 7: Ask the builder how the rebate will be handled

Another important question is whether the builder will credit eligible rebates at closing.

For qualifying purchases from a builder, eligible rebate amounts may be assigned to the builder and credited against the amount payable at closing, provided the applicable requirements are met.

CRA's example of a qualifying $1-million Ontario new home shows the buyer assigning eligible rebate amounts to the builder and receiving the benefit at closing.

Your lawyer and builder should confirm exactly how this will work for your purchase.

A good question to ask is:

"Which HST rebates am I eligible for, and which amounts will be credited by the builder at closing?"

Step 8: Don't forget the other costs of buying

HST relief can make a meaningful difference, but it doesn't eliminate the other costs of purchasing a home.

Alex and Jordan still need to budget for:

• Deposit

• Mortgage financing

• Legal fees

• Land transfer tax

• Property taxes and adjustments

• Home insurance

• Condo or townhouse fees, if applicable

• Moving expenses

• Appliances and furniture

• Immediate home expenses

• An emergency fund

A rebate should improve the affordability picture — not encourage a buyer to stretch beyond a comfortable budget.

What should Ottawa first-time buyers do now?

If you're renting in Ottawa and considering a new-build home, start by understanding your actual numbers.

Before signing an Agreement of Purchase and Sale, ask:

1. Do I meet the federal first-time home buyer requirements?

2. Does the home qualify for the federal rebate?

3. Does it qualify for the Ontario Enhanced New Housing Rebate?

4. Could I qualify for the Ontario New Home Affordability Payment?

5. How do the different rebates interact in my situation?

6. What will the builder credit at closing?

7. What will my lawyer need to do?

8. What cash will I actually need on closing day?

Getting these questions answered before you sign can make the process much easier.

Thinking About Buying a New Build in Ottawa?

The 2026 HST changes may create a significant opportunity for eligible buyers — particularly those considering a qualifying new-build home.

And while you may have heard "up to $130,000", the most important number isn't the headline.

It's the number that applies to you.

Every purchase is different.

If you're considering a new-build townhome, condo or single-family home in Ottawa, I can help you understand the real estate side of the process and the questions you should be asking your builder, mortgage professional and lawyer.

My goal is simple: help you understand the numbers before you sign.

This article is for general information only and is not tax, legal, mortgage or financial advice. HST rebate eligibility, amounts, timing and application requirements depend on the buyer, property and transaction. Government programs and rules can change. Buyers should confirm their individual eligibility and applicable rebate amounts with the Canada Revenue Agency, their lawyer, builder and qualified tax or financial professional before entering into a purchase agreement.

Shelley Snyder, Sales Representative
Coldwell Banker Coburn Realty, Brokerage

Information current as of September 2026.

If you've been watching the Ottawa real estate market this summer, August brought a noticeable shift. Sales pulled back sharply, inventory climbed, and while prices stayed relatively steady, the overall picture points to a market heading into fall with more questions than answers.

Here's a breakdown of what happened, what it means, and what to watch for if you're thinking about buying or selling in Ottawa this fall.

The Headline: Sales Dropped Significantly

A total of 1,002 homes sold through the MLS® System in August, down 18.6% from August 2025 and 24.4% from July. For context, the typical July-to-August dip over the past decade has been under 6%. This year's slowdown was several times larger than normal seasonal patterns.

The August sales count tied 2022 for the lowest August total since 2016.

Year to date, 9,283 homes have sold in Ottawa, down 6.9% compared to the same period in 2025, with total dollar volume sitting at roughly $6.5 billion — a 7.2% year-over-year decline.

This wasn't confined to one segment of the market either. Single-family sales fell 16.3%, townhouse sales dropped 19.9%, and apartment sales declined 22.3%. Every major property type felt the pullback.

But Prices Held Their Ground

Here's the twist: despite the drop in sales, prices didn't follow suit.

• Average sale price: $688,253 (up 0.3% year-over-year, up 0.7% from July)

• Benchmark price (MLS® HPI): $637,700 (up 1.0% year-over-year, up 0.6% from July)

• Median price: $622,357 (down 1.2% year-over-year, down 2.0% from July)

As OREB President Tami Eades put it, steady pricing alongside a sales pullback tells us this isn't a simple story of the market moving uniformly in one direction. Buyers are seeing less competition, while sellers are facing a more challenging environment and may need to be thoughtful about pricing and positioning.

Inventory Is Growing — and That Matters

New listings totalled 2,119 in August, essentially flat year-over-year but down 16.2% from July (a normal seasonal pattern). Active listings reached 4,496, up 11.3% from a year ago — the highest August inventory level since 2016.

The more telling number is months of inventory, which jumped from 3.5 in July to 4.5 in August. Historically, this metric barely moves between July and August — the typical change over the past decade has been zero, and no prior year saw a jump larger than 0.4 months. A full one-month increase is a meaningful signal that homes are taking longer to sell relative to what's available.

Worth noting: this rise in inventory wasn't purely about supply piling up. OREB's review found that terminations, cancellations, and expired listings became more prominent through the summer relative to completed sales — suggesting some sellers may be pausing or reassessing their plans rather than pushing forward under current conditions.

How the Market Behaved by Segment

Single-family homes remained the most stable segment, with the benchmark price up 2.2% year-over-year and 4.0 months of inventory.

Townhouses showed more strain, with 4.1 months of inventory, active listings up 27.1% year-over-year, and a benchmark price down 4.0% — a segment worth watching closely.

Apartments continued to be the softest category, a pattern that has held through 2026 and the back half of 2025, with 6.3 months of inventory and a 43.0% sales-to-new-listings ratio. That said, active apartment listings declined from July and the benchmark price actually rose 1.9% month-over-month, so it's not a story of straightforward deterioration.

A Look Across Ottawa's Neighbourhoods

Ottawa's three suburban submarkets still accounted for over 70% of sales, but all posted year-over-year declines: Suburb West (-14.3%), Suburb East (-20.0%), and Suburb South (-25.1%).

• Ottawa Suburb West had the firmest conditions of the three, with 3.6 months of inventory.

• Ottawa Center and Ottawa Rural East saw softer conditions, with 7.0 and 6.5 months of inventory respectively.

• Ottawa Rural West was the sole bright spot, with sales up 22.6% — though its low transaction volume (76 sales) means that number should be read with some caution.

What's Driving This, and What Comes Next

The national backdrop is actually improving. Statistics Canada reported real GDP grew at an annualized 3.3% in the second quarter, and the Bank of Canada's July outlook described the economy as showing signs of improvement, even while flagging continued uncertainty.

Looking further ahead, CMHC's 2026 outlook expects Ottawa-area sales to stabilize, with slower demand growth and rising supply keeping a lid on price increases. At the national level, RBC Economics expects home resales and prices to decline overall in 2026 before a modest recovery begins in 2027.

The Bottom Line

One month doesn't establish a trend — but the size of August's sales decline, the drop in the sales-to-new-listings ratio, the jump in months of inventory, and the widening year-to-date shortfall are all signals worth watching as we move into fall.

The key question for Ottawa's market: will the properties that left without selling come back with new pricing strategies, or will more sellers step back from the market altogether? That answer will go a long way toward telling us whether August was a blip or the start of something more sustained.

Thinking about buying or selling in Ottawa this fall? Market conditions like these change the calculus for both sides — reach out and let's talk through what it means for your specific situation.

Source: Ottawa Real Estate Board (OREB), August 2026 Market Update