First-Time Home Buyers Can Now Save Up to $50,000 on New Homes
NEW rebate could significantly reduce THE purchase PRICE OF YOUR FIRST HOME
Canada’s $50,000 GST Rebate for
First-Time Home Buyers Is Now in Effect
The federal government has officially passed legislation that removes up to 5% of the GST on qualifying newly built homes for first-time buyers
—saving eligible buyers up to $50,000*.
When building a new home, there are many moving parts to consider—from selecting your floorplan to finalizing your financing. One area that often creates confusion for buyers is the Government of Canada GST New Housing Rebate and how it impacts the overall purchase and mortgage structure. At Shane Homes, the goal is to make the homebuilding experience as seamless and transparent as possible.
What Is the $50,000 GST Rebate?
The Government of Canada has passed legislation that significantly expands the federal GST rebate available to first-time homebuyers purchasing newly constructed homes. With Bill C-4 now in effect, eligible first-time buyers can receive a rebate that effectively removes up to 5% of the federal GST on qualifying new homes priced up to $1.5 million, providing savings of up to $50,000.
This rebate allows eligible buyers to recover some or all of the GST paid on a new home, making newly built homes significantly more affordable for many first-time buyers. For many Canadians, the GST on a newly built home represents a significant cost.
For many first-time buyers, this change could make buying a newly built home significantly more affordable.
This table shows the purchase price of your new home and the estimated rebate based on the new federal plan. The new current rebate is a major increase from the previous federal new housing rebate, which was capped at $6,300. Homes priced between $1 million and $1.5 million may qualify for a partial rebate, which gradually phases out as the purchase price increases. For many buyers in Alberta, where many homes fall below the $1 million threshold, this could mean receiving the full rebate amount.
Home Price
Estimated Potential Rebate*
$700,000
$35,000
$800,000
$40,000
$900,000
$45,000
$1,000,000
$50,000
Home prices and estimated GST rebate amounts shown are examples for illustration only. Actual rebate eligibility and amounts may vary based on purchase price, buyer qualification, and Canada Revenue Agency requirements. Buyers should confirm eligibility and rebate details with their builder or the CRA.*
Who Qualifies?
In most cases, the rebate is applied during the closing process. The typical process works like this:
Choose Home → Purchase Agreement →Closing → Rebate Applied
In many builder transactions, the rebate is assigned to the builder and credited at closing, which can reduce the amount buyers need to pay upfront. A Shane Homes Area Manager can help explain how the rebate may apply to your specific situation.
Buyer Requirements
Property Requirements
Eligible home types
Buyer Requirements
You may qualify if you:
Are at least 18 years old
Are a Canadian citizen or permanent resident
Are considered a first-time home buyer
Have not owned and occupied a home that you own in the current year or the previous four calendar years.
Have not previously received the enhanced first-time GST rebate
Wanting to take the first step to owning your first home? Shane Homes is here to answer all your questions.
In most cases, when purchasing a home with Shane Homes, the GST rebate is built directly into the purchase price. This means the price you see in your agreement already reflects the rebate being applied. From a buyer’s perspective, this simplifies the process significantly. You are not required to apply for the rebate yourself, as the builder handles the application with the Canada Revenue Agency. More importantly, your financing is based on the net purchase price, not the higher price that includes GST.
This has a direct impact on affordability. Your down payment requirement is lower, your mortgage amount is reduced, and your overall cash needed at closing is minimized. For most buyers, this structure creates a smoother and more predictable path to homeownership.
Why This Rebate Matters for First-Time Buyers
When the rebate is included upfront, it improves affordability and reduces the financial burden at closing. When it is not, buyers must temporarily carry that additional cost until the rebate is received.
This distinction can influence:
Your down payment requirements
Your loan-to-value ratio
Your total cash-to-close
Your overall financing strategy
Understanding this early in the process helps avoid surprises and allows for better financial planning.
Important Dates
With Bill C-4 now officially passed and in effect, eligible buyers can take advantage of the enhanced GST rebate on qualifying new homes.
Key timeline details include:
• Applies to purchase agreements signed on or after March 20, 2025 • Applies to purchase agreements signed before 2031 • Construction must begin before 2031 • Homes must be substantially completed before 2036
This means some buyers who purchased a new home as far back as March 20, 2025 may already qualify for the rebate.
If a home purchase closed before the legislation received Royal Assent, buyers may need to apply directly to the Canada Revenue Agency (CRA) to receive the rebate.
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The information provided on this page is for general informational purposes only and is based on publicly available information regarding federal legislation, including Bill C-4 and the First-Time Home Buyer GST Rebate. This content is not intended to constitute tax, legal, or financial advice. Program eligibility, rebate amounts, and administrative procedures are determined by the Government of Canada and the Canada Revenue Agency and may change. Buyers should consult official Government of Canada resources or a qualified professional to confirm eligibility and program details.*
Frequently Asked Questions
What Is a rebate?
A rebate is a refund of money that you would normally have to pay.
When purchasing a newly built home in Canada, buyers typically pay 5% Goods and Services Tax (GST) as part of the purchase price. The new First-Time Home Buyer GST Rebate, introduced through Bill C-4, allows eligible buyers to recover some or all of that tax.
For many first-time buyers, this means the GST on qualifying new homes can be reduced or even eliminated, depending on the home’s price.
Example:
If a new home costs $700,000, the 5% GST would normally be $35,000.
If the buyer qualifies for the enhanced GST rebate, they could receive that $35,000 back, effectively removing the GST from the purchase.
Homes priced up to $1 million may qualify for the full rebate, while homes priced between $1 million and $1.5 million may qualify for a partial rebate.
Depending on how the purchase agreement is structured, the rebate may:
be credited at closing by the builder, reducing the amount you pay upfront, or
be claimed from the Canada Revenue Agency (CRA) after closing
A Shane Homes advisor can help explain how the rebate may apply to your specific home purchase and guide you through the process.
When I the Rebate Not Applied Up Front?
While less common, there are situations where the GST rebate is not credited by the builder at the time of purchase. In these cases, the buyer pays the full purchase price including GST and then applies for the rebate directly with the Canada Revenue Agency after the home has closed.
Although the rebate is still received, the timing changes everything from a financing perspective.
Because the rebate has not yet been applied, lenders must base the mortgage on the full purchase price. This results in a higher down payment requirement and increased upfront cash needed to complete the purchase. The rebate then becomes a reimbursement received after possession rather than an immediate reduction in cost.
For buyers, this scenario requires additional planning to ensure sufficient funds are available at closing.
Is the rebate available right now?
With Bill C-4 now officially passed and in effect, eligible buyers can take advantage of the enhanced GST rebate on qualifying new homes.
Does the rebate apply in Alberta?
Yes. The GST rebate is a federal program, meaning it applies across Canada, including Alberta.
Does the rebate apply to resale homes?
No. The rebate only applies to newly built or substantially renovated homes.
Can I qualify if I signed a purchase agreement in 2025?
Yes, the new rebate applies to purchase agreements signed on or after March 20, 2025
Do all new homes qualify?
Homes priced above $1.5 million will not qualify for the rebate.
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