For many first-time home buyers in Calgary and the surrounding areas, one of the biggest hurdles to homeownership isn’t just saving for the down payment, it’s all the extra costs that get added on top. One of those costs is the federal 5% Goods and Services Tax (GST) that applies to every newly built home.

This year, the federal government has introduced a new proposal called the First-Time Home Buyer GST  Rebate. If it becomes law, it could save buyers up to $50,000 when purchasing a brand-new home. That kind of savings can be the difference between “maybe someday” and “yes, we can move forward”.

What the Rebate Means in Real Numbers

Let’s put this into perspective with a $550,000 new home purchase:

• Without the rebate, you’d be paying GST in full, which adds an additional $27,500 to the purchase price.
• With the rebate, that $27,500 is eliminated, leaving your total price at $550,000 instead of $577,500.

For first-time buyers, that’s more than just a number on paper. It could mean:

• A lower down payment requirement
• Easier approval when qualifying with a lender
• Smaller monthly mortgage payments
• More room in your budget for furnishing, savings, or other life goals

“For many first-time buyers, the biggest challenge is qualifying for the right mortgage while balancing upfront costs. The proposed GST rebate not only reduces the purchase price but can also strengthen your mortgage approval chances. It’s one of the most impactful incentives we’ve seen for new home buyers in recent years.” – Kent Chapman, Mortgage Tree

Who Can Qualify?

The rebate isn’t for everyone; it’s designed to give first-time home buyers a better chance at getting into the market. You may be eligible if:

• You are at least 18 years old and a Canadian citizen or permanent resident
• Neither you nor your spouse/common-law partner have owned a home in the past four calendar years
• You’re buying a brand-new home from a builder (detached, duplex, paired, or townhome)
• You’ll live in the home as your primary residence
• Your purchase agreement is signed between May 27, 2025 and 2031.
• Construction begins before 2031 and is substantially complete before 2036

Why Timing Matters

Here’s the challenge: while the rebate has been announced, it’s not yet law. That means your possession date will determine how it affects you.

• If you take possession before the law is passed, you’ll pay the GST upfront and apply for the rebate yourself later through the CRA.
• If you take possession after the law takes effect, the rebate will be applied directly to your purchase price, lowering your mortgage amount right away.

“From a lending perspective, reducing your home price by $25,000–$50,000 has a direct impact on your borrowing power. A lower mortgage amount means smaller monthly payments and a better chance of meeting lender stress test requirements, making homeownership more attainable.” – Kent Chapman, Mortgage Tree

Our Guidance for First-Time Home Buyers

At Shane Homes, we believe this rebate has the potential to open doors for many buyers who are ready to take the leap into homeownership. Until the law is finalized, here’s our advice:

1. Budget as if GST will apply. This way you’re protected financially, and if the rebate kicks in before possession, it’s a welcome bonus.
2. Plan your mortgage strategy early. Work with a mortgage professional to understand how the rebate could improve your approval chances.
3. Stay informed. Ask us about rebate clauses and what they might mean for your specific purchase and timeline.

“I’ve worked with countless first-time buyers who were so close to qualifying, but the extra costs pushed them over budget. This rebate could be the difference between waiting another few years and moving into your first home now. It’s a game-changer for affordability. This rebate could make a real difference for first-time buyers. By lowering the total purchase price, it reduces the down payment needed, improves qualification chances with lenders, and keeps monthly payments more manageable.” – Kent Chapman, Mortgage Tree

Mortgage Tree has access to over 30+ Lenders including Banks, Credit Unions and Alternative Lenders. Each Lender is unique on how they qualify clients, pre-payment privileges/options and calculating penalties. Having our experience on your side matters to ensure you receive the right mortgage for your needs today and in the future.

Please contact us at [email protected]

Kent Chapman – Broker Owner/Mortgage Advisor
403-797-2093

Koalby Bojda – Mortgage Advisor
403-978-3898