Good news for first-time home buyers in British Columbia! The federal government has delivered on a major promise, and as of May 27, 2025, a new Goods and Services Tax (GST) rebate is available for buyers of newly built homes. This new measure, which amends the existing GST/HST New Housing Rebate, is a significant change aimed at making homeownership more attainable.

IMPORTANT: The GST rebate for first-time home buyers is a proposed measure, not yet law. The information below is based on the proposal tabled on May 27, 2025, and is not yet in effect.

Here’s a breakdown of what you need to know about the new rebate.

How the New Rebate Works

The new program provides a full 5% GST rebate on eligible new homes priced up to $1 million. This can lead to substantial savings for qualifying first-time buyers. For homes priced between $1 million and $1.5 million, a partial rebate is available, which gradually decreases as the price increases. No rebate is available for homes priced at or above $1.5 million.

This new rebate is a welcome update from the previous federal program, which only offered a partial rebate on new homes up to $450,000. It also differs from BC’s Property Transfer Tax (PTT) exemptions, which are separate provincial programs designed to reduce or eliminate the property transfer tax for first-time buyers and purchasers of newly built homes.

Who is Eligible?

To qualify for the new rebate, you must meet the following criteria:

• Age: Be at least 18 years old.
• Residency: Be a Canadian citizen or permanent resident.
• Primary Residence: The home must be for use as your primary place of residence.
• First-Time Buyer: Neither you nor your spouse or common-law partner can have owned or lived in a home you owned in the year of purchase or in the four preceding calendar years. This is a key difference from the old rebate, which was not exclusively for first-time buyers.

The rebate applies to a variety of new housing types, including:

• A new home or condominium purchased from a builder.
• A new home you build or hire someone to build on land you own.
• A share in a co-operative housing corporation that corresponds to a new unit.

Key Dates and Conditions

To be eligible, the purchase or construction of the home must meet specific timing requirements:

• Purchase Agreements: Must be entered into on or after May 27, 2025, and before January 1, 2031.
• Construction: Must begin before January 1, 2031, and be substantially completed before January 1, 2036.

It’s also important to note that the rebate is a one-time benefit per person. If your spouse or common-law partner has already claimed the rebate, you will not be eligible. This prevents a couple from claiming the rebate twice on different properties.

For those purchasing an assignment sale, the rebate is only available if the original agreement was signed on or after May 27, 2025.

What This Means for You

In most cases, the rebate is claimed by the builder on your behalf, and the amount is credited directly to you on the final purchase price. This is done through your lawyer or notary at the time of closing. However, it’s crucial to confirm this with your builder and legal professional to ensure you have the necessary funds to cover the full GST amount if the builder does not credit the rebate upfront.

For any questions about this rebate program or for your real estate purchases, please call Northam Law at 604-630-2350 or email melissa@northam-law.com.

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