Builders and brokers welcomed tax relief but warned it would not fix Ontario’s housing crunch
Ontario’s 2026 budget promised to lower the cost of buying a new home by expanding HST relief, but the housing sector greeted the move as necessary yet far from sufficient.
Industry groups have pushed for this shift for years. In 2025, the province pledged to remove the full 8% provincial portion of HST for first‑time buyers of new homes up to $1 million, a change the Ontario Real Estate Association (OREA) described as “much‑needed relief” for entry‑level purchasers. The new budget extended that concept to all eligible buyers of new homes, in tandem with federal measures.
Ontario realtors now see that campaign partly realized.
“Ontario’s nearly 100,000 realtors know the true value that homeownership brings,” OREA president Kim Fairley said.
“Today’s 2026 Ontario Budget reiterated the Province’s commitment to reducing barriers to housing affordability, bringing more supply to market, and supporting growth in our communities.”
Fairley said lowering housing costs through incentives and “innovative pathways to homeownership” remain critical, while warning that high development charges still weighed on new projects.
She welcomed the pledge for Ontario and Ottawa to work on reducing development charges, arguing that cutting those costs would do more to unlock supply than tax tweaks alone.
Developers backed tax relief but warned on stalled construction
Developers also framed HST relief as a lifeline for a slowing construction pipeline. The Ontario Home Builders’ Association previously warned that inaction on broad GST/HST relief risked tens of thousands of jobs and tens of billions in stalled investment.
Joel Fox, co‑founder and COO of Ownright, said removing HST on new homes would “make building and buying easier,” but he cautioned that it would not trigger a surge in sales overnight. Buyers remain cautious and sellers resist resetting expectations in what many still see as a slow market, he said.
Kevin Fettig, president of CMI Financial Group, said enhanced HST relief is “a step in the right direction” for condo and new‑build demand and could support Toronto’s struggling pre‑construction sector.
He argued that, combined with federal measures, the changes “can result in up to $130,000 of cost savings” for some buyers of newly built homes, while acknowledging that affordability would still depend on cutting red tape and development charges.
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