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Market & Policy

March 30, 2026 · The Couple Estates

Carney and Ford Strike $8.8B Housing Deal: Full 13% HST Removed on New Ontario Homes Under $1M, Development Charges Cut 50%

On March 30, 2026, Prime Minister Carney, Premier Ford, and Mayor Chow announced the largest Ontario housing policy shift in a generation — full HST relief for all new-home buyers up to $1M, and a 50% cut to municipal development charges. Here's the full breakdown.

Carney and Ford Strike $8.8B Housing Deal: Full 13% HST Removed on New Ontario Homes Under $1M, Development Charges Cut 50%

This is the biggest single housing policy announcement Ontario has seen in at least a decade.

Prime Minister Mark Carney, Premier Doug Ford, and Toronto Mayor Olivia Chow stood together at a joint news conference this afternoon to unveil an $8.8 billion Canada–Ontario Partnership to Build — $4.4B from each order of government — that does two very large things at once:

  1. Removes the full 13% HST on new homes valued up to $1 million for ALL buyers (not just first-time buyers), for agreements signed between April 1, 2026 and March 31, 2027.
  2. Cuts municipal development charges in half for three years in participating Ontario municipalities — with federal-provincial infrastructure dollars replacing what municipalities give up.

On a qualifying $800,000 new-build, a buyer could now save more than $200,000 relative to what the same purchase would have cost six months ago. This is not a rounding-error policy.

Here's what was announced, how the math works, and what it means for anyone shopping or selling pre-construction in Ontario.

The bottom line

  • Full 13% HST removed (both federal 5% GST and Ontario 8% provincial) on new homes up to $1,000,000, for all buyers.
  • Applies to agreements of purchase and sale signed April 1, 2026 to March 31, 2027.
  • Municipal development charges cut by up to 50% for 3 years in participating municipalities — covering an estimated 80% of Ontario's population.
  • Combined effect: up to $200,000 off the all-in cost of a new home.
  • $8.8B total investment over 10 years ($4.4B federal + $4.4B provincial).
  • Projected to support ~8,000 additional housing starts next year and ~21,000 jobs.
  • Toronto, Mississauga, Brampton, Vaughan, Markham, Ottawa, Hamilton are all expected to opt in.

What exactly is being offered

The HST relief (buyer-side)

The single biggest change from the November 2025 FTHB-only rebate: this expanded relief applies to every buyer, not just first-time buyers.

  • Home price $0 – $1,000,000: Full 13% HST rebated. Maximum saving $130,000.
  • Home price $1,000,000 – $1,500,000: Flat $130,000 reduction, declining as a percentage of price.
  • Home price $1,500,000 – $1,850,000: Declining reduction from $130,000 down to the existing $24,000 provincial baseline rebate.
  • Home price above $1,850,000: Existing baseline rebates only.

Critical date mechanics:

  • Agreement of Purchase and Sale must be signed on or after April 1, 2026 and on or before March 31, 2027.
  • Construction must begin by December 31, 2028.
  • Home must be substantially completed by December 31, 2031 (primary residence) or December 31, 2029 (rental).
  • Home must be newly constructed or substantially renovated.

What this means in plain English: if you sign a builder contract on a $950,000 townhouse in Milton on, say, June 1, 2026, you will save approximately $123,500 in HST at closing. That is not a discount the builder extends — it is a tax rebate the government is directly funding.

The development charge cut (builder-side, with downstream buyer benefit)

Development charges (DCs) are levies municipalities charge builders to fund infrastructure — sewers, parks, transit, libraries — that new housing creates demand for. In the GTA, DCs have climbed astronomically over the past decade: in Toronto, DCs on a single detached home can exceed $137,000, and on a two-bedroom condo roughly $80,000–$90,000. Those charges get built into the sticker price of new homes.

Under the Carney–Ford agreement:

  • Municipalities cutting DCs in half for 3 years will receive federal-provincial funding to offset the revenue they lose.
  • Municipalities that refuse to cut DCs get zero of the $8.8B — Ford was explicit: "If you don't cut DCs, you aren't getting any money."
  • The program is time-limited to 3 years, after which DCs revert unless extended.

Expected result: new construction prices come down by $30,000–$75,000 across most unit types as builders compete for buyers in a market with restored transaction volume. Not all of the DC savings will pass through — some will be absorbed as builder margin — but meaningful downward pressure on new-build prices is real.

The worked math: a $900,000 new Milton townhouse

Here's how the cost to a buyer changes between someone who signed last year versus signing in May 2026:

Line itemPre-April 2026 buyerApril 2026 – March 2027 buyer
Sticker price$900,000~$845,000 (DC cut passed through)
HST (13%)$117,000$0 (fully rebated)
Development charges already in priceincludedpartially reduced
All-in cost to buyer~$1,017,000~$845,000
Saving—~$172,000

On a detached new build in Brampton or Vaughan priced at $1.4M, the combined savings are closer to $180,000–$220,000, depending on the DC pass-through rate.

What this means for first-time buyers

If you signed before April 1, 2026, the November 2025 FTHB rebate still applies to your purchase as originally described.

If you are signing between April 1, 2026 and March 31, 2027, you get the new broader enhanced relief — which is generally more generous than the FTHB-only rebate because it removes the entire 13% HST rather than requiring the phase-out structure at $1M+.

Practically: if you were holding off on signing pre-construction to figure out which program applies, sign after April 1. The enhanced relief is simply better.

What this means for move-up buyers and investors

This is the group that benefits most from the change, because they were excluded from the November FTHB rebate. Under the new agreement, any buyer — first-time or not — signing a qualifying new-build purchase in the one-year window gets the full HST relief.

For move-up buyers: if you are selling a resale home and buying a new-build, the combined tax savings materially change the gap you have to bridge. A family selling a $1.2M semi in East York to buy a $1.4M new build in Oakville would save roughly $105,000 on the new-build HST plus benefit from any DC pass-through.

For investors: the economics of new-build investment properties improve, but remain challenging given soft rents. The rental pathway requires substantial completion by December 31, 2029 — a tighter timeline than the primary-residence rule, so pre-construction investors need to verify builder delivery schedules carefully before signing.

What this means if you are selling resale

Cold read: this is marginally negative for resale prices in neighbourhoods with heavy new-build competition — Oakville, Milton, North Oakville, Brampton northwest, Vaughan, Caledon, East Gwillimbury. A $950,000 new-build with $125,000 in tax relief is effectively a $825,000 home to a buyer's cost base. Resale sellers in those markets will need to price sharper to compete.

For resale in neighbourhoods without substantial new-build supply — mature Toronto, most of Mississauga proper, inner Oakville, Burlington lakeshore — the direct competitive pressure is smaller. The broader market lift from restored buyer confidence should more than offset it.

If you are considering listing a resale property in a new-build-heavy sub-market, list early — in April or May, before the first wave of newly-signed builder purchases starts closing in late 2027 and depressing comps.

The politics

Three things worth naming:

1. Federal-provincial coordination. This is the first major housing announcement where Ottawa and Queen's Park are materially aligned. The Ford and Carney governments had been cool on housing coordination for most of 2025. Pressure from municipal mayors (Chow in particular), slumping housing starts, and the broader growth slowdown appear to have brought them together.

2. Municipal pressure. The requirement that municipalities cut DCs to access funds puts real pressure on city councils. Mississauga and Vaughan have signalled they're in. Toronto has said yes but wants flexibility on how the DC cut is applied. Some smaller municipalities worry about losing infrastructure funding — not every municipal mayor is on board.

3. The 2026 Ontario election. Ford is facing a June 2026 provincial election. This agreement gives him a tangible housing story to campaign on after a year of negative news about development. Carney's federal housing team gets a flagship signing moment. Chow positions Toronto as a partner rather than an obstacle heading into her own October 2026 municipal vote.

What happens next

  • April 1, 2026: HST rebate window opens. Builders start signing purchasers under the new rules.
  • April – June 2026: Participating municipalities formally pass DC reduction by-laws.
  • Spring/summer 2026: First wave of new-build contract signings at the new reduced effective price. Pre-construction activity ramps up sharply.
  • March 31, 2027: HST relief window closes — absent an extension. Locked-in agreements still close after this date and retain the relief.

If you're thinking about a pre-construction purchase at any price point up to $1.85M, 2026 is materially the best year to buy new construction in Ontario since at least 2014. The combination of softened prices, reduced DCs, and fully rebated HST is not going to repeat soon. Browse new-construction listings or get in touch to talk through specific builders and inventory that fit the rebate rules.

Sources

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