New GST Rebate for First-Time Buyers: What You Need to Know - Fifth Avenue REM mediaiqdigital tracking pixel
Home Buying, Market Intelligence, Real Estate News | May 28, 2025

Big news for first-time homebuyers in Canada

The federal government has announced a new GST rebate that could save you up to $50,000 on the purchase of a new home. Here’s a simple breakdown of how it works, who qualifies, and why it matters for your homeownership journey.

What Is the New First-Time Homebuyer GST Rebate?

As of May 27, 2025, the Government of Canada is offering a full or partial GST rebate for eligible first-time buyers purchasing newly built homes valued at up to $1.5 million.

Here’s what you can get:

Home Price Rebate Amount
Up to $1 million Full 5% GST rebate
$1 million – $1.5M Partial rebate
Over $1.5 million No rebate

👉 Translation: On a $1 million home, that’s a potential $50,000 back in your pocket.

Who Qualifies?

To be eligible, you must meet these four conditions:

  1. You’re a first-time buyer — haven’t owned and lived in a home in the past four years.

  2. You’re at least 18 years old.

  3. You’re a Canadian citizen or permanent resident.

  4. You plan to live in the home as your primary residence.

The rebate applies to:

  • New homes purchased from a builder

  • Owner-built homes

  • New co-op housing units

Important: Your purchase agreement must be signed after May 27, 2025, and the home must be built before 2036.

Why This Matters: More Affordable Entry into the Market

In cities where home prices are high — like Surrey, Kelowna, or Hamilton — this rebate helps first-time buyers stay competitive.

Encouraging New Housing Supply

Because the rebate only applies to new construction, it also motivates developers to build more homes — helping ease Canada’s housing shortage.

Real-Life Example

Let’s say you’re buying a new townhouse in Abbotsford for $1.2 million:

  • Normally, you’d pay $60,000 in GST (5%)

  • With the new rebate, you might save around $30,000

  • That’s money you can put toward furnishings, closing costs, or savings

Other Tools You Can Use With the Rebate

This GST relief isn’t the only tool available to first-time buyers:

🏦 First Home Savings Account (FHSA)

  • Save up to $8,000/year tax-free

  • Use it for your down payment

📆 30-Year Mortgage Option

  • New insured mortgages for first-time buyers can now stretch to 30 years (for new builds)

  • That means lower monthly payments

Final Thoughts: How to Take Advantage

If you’re thinking of buying your first home:

✅ Talk to your realtor or a mortgage broker about homes that qualify
✅ Look at presale opportunities — many new builds fall into this price window
✅ Act early — this program applies until 2030, but early buyers will benefit from better availability

Stay Informed

Bookmark this blog or sign up for updates — we’ll keep you posted on how this policy evolves, plus tips to maximize your rebate. Learn more: Official Government Announcement

 

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