RESCON applauds move by governments to cut sales taxes on new homes for all buyers

Article content

Vaughan, Ont., March 25, 2026 (GLOBE NEWSWIRE) — Today’s announcement that the federal and Ontario governments are extending the 13-per-cent sales tax break on new homes worth $1-million or less to all buyers – not just first-time homebuyers – is a bold and timely move that will breathe new life into the struggling residential construction sector.

Article content

“This is a critical step towards making new homes more affordable and demonstrates that Premier Doug Ford and Prime Minister Mark Carney understand the severity of the housing downturn and the urgent need for decisive action to restore confidence in the market,” says RESCON president Richard Lyall. “It is a necessary initiative given the depth of the market downturn and grim outlook for the industry. This will help revive residential construction and save industry jobs.”

Article content

Article content

Article content

The measure aligns with what RESCON and other industry stakeholders have been advocating for some time. The sector has been grappling with a perfect storm of economic pressures, including rising construction costs, regulatory barriers and an exorbitant tax burden on new housing. An earlier report produced for RESCON by the Canadian Centre for Economic Analysis (CANCEA) revealed that taxes, fees and levies account for 36 per cent of the cost of a new home.

Article content

Article content

The result has been a dramatic slowdown in new home sales and housing starts across the province. In the Greater Toronto Hamilton Area, single-family home sales have plunged, and housing starts have fallen sharply, contributing to job losses across the industry and its supply chain.

Article content

“The stakes for our industry could not be higher,” said Lyall. “Residential construction is one of the key economic engines of this province. When projects stop moving forward, it affects everyone from skilled tradespeople and apprentices to manufacturers and local businesses.”

Article content

Another recent report done by CANCEA for RESCON and the RCCAO indicated that a three-year HST holiday on new homes would help preserve skilled trade jobs, incentivize buyers to purchase new homes and, importantly, be revenue neutral for governments, as the increased economic activity would offset foregone tax revenues.

Article content

Article content

RESCON wanted the HST eliminated on new homes because, without meaningful intervention, starts and sales were forecast to remain stagnant. Today’s measure – along with an earlier move by Ontario to eliminate the HST on purpose-built rental housing and a federal initiative to remove the GST on new homes for first-time buyers who enter into a purchase agreement before 2031, will make a meaningful difference.

Article content

RESCON maintains that additional action will still be required to right the ship, such as reforming development charges, providing faster approvals and removing barriers to housing delivery. Over the past 25 years, development charges in Toronto have risen by more than 5,000 per cent – far outpacing inflation, which increased by just over 70 per cent during the same period, according to the Missing Middle Initiative.

Article content

“However, the step taken today is exactly the kind of initiative we need right now,” notes Lyall. “Housing shouldn’t be taxed like alcohol or tobacco. It is a basic economic necessity and the foundation of healthy communities and a strong economy. Builders are ready to build and continue to work with government to remove the remaining obstacles that prevent builders from delivering homes that are affordable.”

Article content

RESCON is the province’s leading association of residential builders committed to providing leadership and fostering innovation in the industry.

Article content

Article content

Article content

Article content

Article content

Article content

Article content