Do You Pay HST When Buying a Home in Ontario?

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If you’re buying a home in Ontario, you’ve probably wondered whether you’ll have to pay Harmonized Sales Tax (HST).

For most buyers, the answer is simpler than you might expect. Most residential resale homes in Ontario are not subject to HST on the purchase price. Newly built homes are generally subject to HST, although how HST is reflected in the advertised price—and how available rebates are applied—can vary from one builder to another.

Understanding how HST works before you make an offer can help you compare homes more confidently, budget accurately for closing costs, and avoid surprises throughout the buying process.

Do You Pay HST on a Resale Home in Ontario?

Generally, no. Most previously occupied residential resale homes in Ontario are exempt from HST on the purchase price.

If you’re purchasing a resale home, the agreed purchase price is typically the amount you’ll pay for the property itself. This is because HST generally applies when a newly constructed home is sold for the first time. Once that home has been owned and occupied, subsequent residential resale transactions are typically exempt.

You may still notice an HST clause in the standard Agreement of Purchase and Sale. Although this often raises questions, the clause is included because the agreement is designed to accommodate many different types of real estate transactions. In a typical residential resale transaction, the seller certifies that the sale is not subject to HST.

It’s important to remember that this exemption applies to the home itself—not necessarily to every cost associated with buying it.

Buying a house for the first time? Check out these related blog posts first!

How Is HST Handled on a New Build?

Newly constructed homes are generally subject to HST, but buyers shouldn’t assume every builder presents pricing the same way.

Some builders advertise prices that already account for available rebates, while others present pricing differently. Rather than relying on the advertised price alone, it’s worth confirming exactly how HST is being treated before signing an Agreement of Purchase and Sale.

Your purchase agreement should clearly explain whether HST is included in the purchase price, whether any new housing rebates have been applied, and what conditions must be met to qualify for those rebates. Understanding these details early can make it much easier to compare homes from different builders and avoid unexpected costs later on.

How Do New Housing Rebates Affect the Price?

To help offset the cost of HST on qualifying new homes, both the federal and Ontario governments offer new housing rebates.

For buyers purchasing a new home as their primary residence, these rebates are often incorporated into the purchase transaction. How they’re applied can vary depending on the builder and the structure of the sale, which is one reason advertised prices don’t always look the same from one community to another.

Eligibility depends on several factors, including how the property will be used after closing. For the most up-to-date eligibility requirements, you can review the Canada Revenue Agency’s guidance on GST/HST new housing rebates.

What Home-Buying Costs Are Subject to HST?

Even if you aren’t paying HST on the purchase price of a resale home, you’ll still encounter it throughout the buying process.

Many of the professional services involved in a real estate transaction are taxable, including legal fees, title insurance, appraisal fees, home inspections, and moving services.

Although these expenses are generally much smaller than the purchase price itself, they can add up alongside other closing costs. Planning for them in advance can help you budget more accurately and reduce surprises as closing day approaches.

Thinking about buying a house? Read these blog posts for more advice!

What Buyers Should Confirm Before Making an Offer

Before comparing homes—or signing an Agreement of Purchase and Sale—it’s worth taking a few minutes to understand how HST is being treated.

If you’re buying a new build, confirm whether the advertised price includes HST, assumes available rebates, or presents pricing another way. Your purchase agreement should also explain any rebate conditions and how they’ll be applied to the transaction.

If you’re purchasing a resale home, the HST clause included in the standard Agreement of Purchase and Sale is typically a formality. In most residential resale transactions, the seller certifies that the sale is not subject to HST.

Asking these questions early can help you compare properties on an equal footing and better understand your overall costs before moving forward.

Make Your Move

For most home buyers in Ontario, HST is less complicated than it first appears.

If you’re buying a resale home, you generally won’t pay HST on the purchase price. If you’re buying a newly built home, HST generally applies, but the way it’s reflected in the advertised price can vary from one builder to another. Regardless of the type of property you’re purchasing, you’ll still want to budget for HST on many of the professional services involved in completing the transaction.

Understanding how HST fits into the buying process can make budgeting easier and help you make more informed decisions as you move toward closing day.

Whether you’re purchasing your first home, upgrading, downsizing, or exploring a new build, The Wright Team is always happy to answer your questions and help you navigate the process with clarity and confidence.

Ready to buy? We’d love to help you find the place that feels like home. Call 613-692-0606 to get in touch, or reach us by email at info@ottawahomes.ca.