August 26, 2026

Every custom home starts with a wish list, and every wish list eventually meets a budget. The two usually find their balance somewhere in the middle, with a few favourites making the cut and a few getting saved for “next time.”

This year, that balance might tip a little further in your favour. Ontario has introduced a temporary enhancement to its HST rebate on new homes, and for homeowners planning a custom build, it could mean a meaningful amount of extra budget to work with before a single wall goes up.

In this blog, we cover:

• What the Ontario Enhanced HST Rebate is and who it applies to
• The upgrades homeowners are putting that freed-up budget toward
• The timing that matters if you want to take advantage of it

What Changed

Ontario’s Enhanced HST Rebate temporarily removes the provincial portion of the HST on new homes, and it’s not limited to first-time home buyers. It applies to eligible buyers of new homes more broadly, including someone who’s owned a home before and is now building a custom home. Here’s what that looks like in practice:

• Removes the full 8% provincial portion of the HST on new homes valued up to $1 million.
• Worth up to $80,000 back.
• A reduced rebate still applies for homes between $1 million and $1.85 million.
• Applies to agreements of purchase and sale signed between April 1, 2026 and March 31, 2027.
• Construction and completion deadlines extend beyond that window, so the home doesn’t need to be finished by March 2027, just the agreement signed by then.

Eligibility comes down to specifics like home value, use of the property, and timing of your agreement of purchase and sale, and those details are worth confirming directly rather than estimating. For the full eligibility criteria, the Government of Ontario’s 2026 Budget HST page and the Canada Revenue Agency’s Ontario Enhanced New Housing Rebate notice are the most current sources. Your accountant or a tax professional can also walk through how it applies to your specific project.

Where That Budget Could Go

For a lot of homeowners, that’s the more interesting question.

Some will take it as straight savings, and that’s a completely reasonable choice. Others are treating it as budget that was already accounted for, now available to put toward decisions they’d been weighing against cost. Here’s where that budget could go.

Performance and long-term cost

The upgrades that don’t show up in a walkthrough but show up on every utility bill after.

• Triple-pane, high-performance windows.
• A heat pump or upgraded HVAC system.
• Improved insulation and air sealing.
• Solar panels or solar-ready wiring.

Materials and finishes

The extra budget gives homeowners room to move up within that range or reconsider a choice they’d landed on for cost reasons.

• Moving from luxury vinyl plank to hardwood in select rooms
• Choosing a premium hardwood tier over a mid-range option
• Natural stone countertops instead of an engineered alternative
• Custom-built cabinetry, in the kitchen or throughout the home
• Upgraded trim, millwork, and hardware

Layout and livability

Space that solves a real problem, not just square footage for its own sake.

• Finishing a basement into usable living space.
• Adding a mudroom, pantry, or additional storage.
• Building in a home office or flex room.
• Accessibility features like wider doorways, curbless showers, or main-floor primary suites.

Outdoor living

Extending the home past its exterior walls.

• A custom deck or covered patio.
• Professional landscaping and hardscaping.
• Outdoor kitchens or fire features.
• Lighting that makes the space usable after dark, not just decorative.

Smart home and systems

Building the technology in from the start instead of retrofitting it later.

• Integrated security systems.
• Automated lighting.
• Smart climate control.
• Whole-home audio or wiring for future tech.

None of these are add-ons for their own sake. They’re the upgrades that tend to get cut first when budgets are tight, and this is a chance to put some of them back on the table.

Timing Matters

This rebate is only available for agreements signed between April 1, 2026, and March 31, 2027. If you’re already thinking about a custom home, this is a reasonable moment to start that conversation, so the numbers can factor into planning from day one rather than getting revisited later.

If you’re planning a custom home and want to understand how this could factor into your budget, that’s a conversation worth having early.

Book a consultation.

Frequently Asked Questions

Do I have to be a first-time home buyer?
No. The Ontario Enhanced HST Rebate applies to eligible buyers more broadly, including those who’ve owned a home before. For full eligibility criteria, see the Government of Ontario’s HST rebate page.

Does this rebate apply to renovations?
It can, but only for renovations substantial enough to be treated as a new home under CRA rules. The CRA’s Ontario Enhanced New Housing Rebate notice has the specific criteria.

What’s the deadline?
The rebate applies to agreements of purchase and sale signed between April 1, 2026 and March 31, 2027.

Where can I confirm my own eligibility?
This blog is meant as a general overview, not tax advice or an eligibility check. Your accountant or a tax professional, along with the official CRA and Ontario government resources linked above, are the right places to confirm your specific situation.