First-Time Home Buyer GST Rebate 2025: What You Need to Know
In a significant move to enhance housing affordability, the Canadian government has introduced the First-Time Home Buyers’ (FTHB) GST Rebate, effective May 27, 2025. This initiative aims to alleviate the financial burden for first-time buyers and stimulate new home construction across the country.
Key Highlights of the FTHB GST Rebate
Full GST Rebate: First-time buyers purchasing new homes valued up to $1 million are eligible for a 100% rebate on the federal Goods and Services Tax (GST), potentially saving up to $50,000.
Partial Rebate for Higher-Priced Homes: For homes priced between $1 million and $1.5 million, the rebate phases out linearly. For instance, a home valued at $1.25 million would qualify for a 50% rebate, equating to savings of approximately $25,000.
No Rebate Beyond $1.5 Million: Homes priced at or above $1.5 million do not qualify for the rebate.
Eligibility Criteria
To benefit from the FTHB GST Rebate, applicants must:
Be at least 18 years old.
Hold Canadian citizenship or permanent residency.
Not have owned or lived in a home they or their spouse/common-law partner owned in the current or previous four calendar years.
Intend to use the purchased property as their primary residence.
Applicable Property Types
The rebate applies to:
Newly Constructed Homes: Purchases directly from builders, provided the agreement is signed between May 27, 2025, and December 31, 2030, with construction commencing before 2031 and substantial completion by December 31, 2035.
Owner-Built Homes: Individuals building their own homes or hiring builders to construct on owned or leased land, adhering to the same timelines as above.
Co-operative Housing Units: Purchases of shares in a co-operative housing corporation that confer the right to inhabit a new housing unit, with the same eligibility dates and construction timelines.
Limitations and Considerations
The rebate is a one-time benefit per individual and cannot be claimed if a spouse or common-law partner has previously availed of it.
Assignment sales (transfers of purchase agreements before construction completion) are ineligible if the original agreement was signed before May 27, 2025.
Cancelled and re-signed purchase agreements post-May 27, 2025, may disqualify applicants from the rebate.
Industry Perspectives
While the initiative is lauded for aiding first-time buyers, industry experts suggest that its impact might be limited due to the relatively small proportion of first-time buyers purchasing new homes. Organizations like the Canadian Home Builders' Association advocate for broader measures to address housing affordability comprehensively.
Final Thoughts
The FTHB GST Rebate represents a strategic effort to make homeownership more attainable for first-time buyers and to invigorate the housing market. Prospective buyers are encouraged to assess their eligibility and consider how this rebate could facilitate their entry into the housing market.
For personalized guidance on leveraging this opportunity, connect with our team at info@evolvedrealty.ca or visit our website at www.evolvedrealty.ca. Let Evolved Realty be your trusted partner in navigating the path to homeownership.