Removing the GST on New Homes Would Improve Affordability in Ottawa

OTTAWA, ON - The Greater Ottawa Home Builders’ Association (GOHBA) and PMA Brethour Realty Group Ottawa say the election promises by the federal Liberal and Conservative parties to remove the federal GST from new homes would impact new home prices in Ottawa and improve housing affordability in the region.

 

While Liberal leader Mark Carney pledges to eliminate the GST for first-time homebuyers on homes at or under $1 million, saving buyers up to $50,000, Conservative leader Pierre Poilievre says his government would eliminate the GST for all new homes under $1.3 million, roughly $65,000 in potential savings.

 

“For the Ottawa housing market, either of these measures would translate to significant savings for many new homebuyers,” says Jason Burggraaf, Executive Director of GOHBA. “The Conservative proposal is broader in scope as it covers all new homes, but both are moving in the right direction of increasing the supply of housing, which is the number one measure to address our housing affordability crisis both in Ottawa and across the country.”

 

According to PMA Brethour Realty Group data, the average cost of a newly built townhome in Ottawa was $658,687 in February 2025, while the average price of a newly built single-detached home was $992,656.

 

“Based on our most recent market data, February year-to-date sales of two-storey townhomes, condo towns and condo apartments — the housing choice of most first-time buyers and fall under a million dollars — make up 74 per cent of our total new home market,” says Cheryl Rice, President of PMA Brethour Realty Group Ottawa.

 

Rice explains that roughly 4 per cent of these sales are from investors and second-time buyers and that single-family home sales make up the remaining 26 per cent of the market, of which a small percentage would be first-time buyers at price points well under $1 million.

 

“Should current trends continue for 2025, we can expect that as much as 70 per cent of new home sales in the Ottawa market could qualify for either GST incentive,” says Rice.

 

Although neither party has announced when or how they would remove the GST from new homes, it is expected that whoever forms the next government will do so by increasing the GST Rebate maximum home price threshold, which is currently $450,000.

 

GOHBA supports all efforts to reduce government-imposed housing costs, especially with its tax-on-tax dynamic of GST on new homes. GOHBA will also push the newly elected Ontario provincial government to match the tax removal plan of whichever party forms the next federal government.

 

GOHBA remains committed to advocating for policies that promote housing affordability and supply for Ottawa’s residents, now and into the future.