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Realtor & Industry Insights • 17 August 2026

The Enhanced HST Relief Program: Benefit or Bailout?

by C21 Local Home Team
The Enhanced HST Relief Programs… Benefit or Bailout?

In March of this year, the Canadian federal government and the Ontario provincial government announced the Enhanced HST Relief Program, eliminating the HST on qualified purchasers of qualifying new homes through a rebate of up to $130,000.

 

I thought then (and still do now) “this is amazing!” There’s no HST on resale homes; why was it ever on new homes in the first place?!

 

 

To me it was obvious that the governments were trying to spur new home sales and construction starts to keep the economy rolling. They were quick to make the announcement, but slow to put policy in place to administer the mechanics.  As the Enhanced HST Relief Program took shape, the qualifications to receive the credits changed. It quietly moved from first-time home buyers and owner occupants to anyone buying a new home.

 

I still maintain that this is great; the tax should have never been charged in the first place. But what appeared to be constituted to spur construction slowly seemed to actually have come into existence to bailout big city condo developers.

 

There were thousands of already built and under-construction condos in the GTA at the beginning of 2026. As these policies received assent at provincial and federal levels, we started hearing about companies like “High Art Capital” and “Jesta Group”. These companies are being labelled “vulture funds” as they circle around inventory-heavy developers and swoop in to make offers on bulk purchases for a deal.

 

The Enhanced Ontario New Residential Rental Property Rebate Program (launched alongside the Ontario Enhanced New Housing Rebate) is making this possible. Many are labelling this a developer bailout.

 

Did the government intervene with the market? Should they have let it play out its natural course to find a natural bottom in the market? Many are going a step deeper and calling this a bank bailout, as Canadian banks and credit unions often have more exposure to losses than the developers do in these scenarios. It’s now happening in BC too.

 

There are some benefits to the public here as well, as it should introduce more rental housing inventory to the market. But there’s controversy too.

 

Homes built after 2019 in Ontario are not subject to rent control… Will these vulture funds just issue huge rent increases when the market surpasses the value paid for the purchase to get the units empty and flip them?

 

The banks were using “blanket appraisals” on buildings to help over-committed purchasers close on contracts that were bought at Covid-era highs… OFSI actually had to step in and outlaw the practice.

 

Also controversial… the governments are helping fund these vulture funds. Look up “High Art Capital Build Ontario Fund Mezzanine Loan”. High Art Capital put up $6M and secured $294M from the Building Ontario Fund towards $1.3 billion in condo purchases. And in BC, the provincial government is actually the purchaser.

 

Controversy aside… I still believe the Enhanced HST Relief Program is good for the Canadian economy as a whole and benefits Canadian households. Is it a builder bailout? A bank bailout? Is it good for tenants? Hard to say.

 

It sure is interesting watching history in the making though, and in the meantime it’s great to see new construction in Windsor-Essex and Chatham-Kent moving again! We are seeing lots selling, permits being pulled and trades showing up at sites to build homes.

 

 

Here are some links to articles and podcasts that you may find interesting (if you made it this far!)

 

Cody Kraus
Broker | Owner
c: 519.322.7105
e: cody.kraus@century21.ca

 

The information provided on this blog is not intended as professional advice and should not be substituted for the guidance of a qualified professional. While we strive to provide accurate and up-to-date information, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained on the blog for any purpose. Any reliance placed on such information should be independently verified.
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