Buying your first home in Victoria just got more affordable!
The Government of Canada announced late May 2025 a new GST relief program for eligible first-time home buyers. We’ve covered other financial aid programs and benefits for first-time home buyers in a previous post, and this one is added to the growing list! At Auxilium Mortgage, we’re dedicated to keeping up to date on program and policy additions and changes so that you can maximize your savings on the purchase of a new home. Let’s dive into this new program, who can benefit, and how much you could potentially save on your new home.
What is the new GST relief program for 2025?
Under the new program, first-time home buyers can now benefit from up to a full GST rebate on the purchase of newly built homes in a phased rebate structure:
- 100% rebate on GST for new homes valued at $1mil or less
- Phased out rebate on homes between $1mil to $1.5mil
- The phase-out for homes over $1mil is linear, for example: a $1.1mil home would receive an 80% rebate, $1.2mil = 60%, $1.3mil = 40%, $1.4mil = 20%, $1.5mil = 0%.
This policy replaces the previous GST New Housing Rebate rules for first-time home buyers.
It’s no secret that homes on the island can be expensive (check out our list of the Top 10 Most and Least Expensive Homes to find out more!), so this rebate is a game changer for those looking to live in hot areas like Victoria, Saanich, and Tofino!
Who qualifies for the GST relief program?
To be able to take advantage of this rebate, there are a few criteria that you must hit:
- You must be a first-time home buyer (Canadian citizen, 18 years or older, and have not lived in a home that you and your spouse/common-law partner have owned within the last 5 years)
- The home must be a new construction or a pre-construction
- You must be the ones living in the home (no investment properties)
- The purchase price of the home must be $1.5 million or less
This rebate also applies if you are constructing the home yourself or hiring a builder on your behalf to build the home for you, as well as for the purchase of shares of a cooperative housing corporation.
How much can I save with the new GST relief program?
First-time home buyers can get significant savings with this new relief program. The 5% federal GST on a $1 million home is $50,000 – no small change! Even a house priced at $1.4 million can see savings of $10,000. We’ve talked recently about how to lower your down payment, and taking advantage of programs like these can make a noticeable difference in your mortgage qualification, monthly payments, and closing costs. Take our mortgage payment calculator for a spin and see what a difference $50k can make on your monthly payments!
Why we’re excited about this new rebate program change
Our specialty at Auxilium is helping future and current homeowners find the best mortgage for their unique financial situation, no matter if their credit is shining or a little bruised. Government programs like these help Victoria residents afford homes in our area, especially with the higher average home prices in the region.
How do I apply for the GST relief?
At this time that the buyers are responsible for the payment of the applicable GST up-front, and afterwards apply for the rebate with the federal government. It is unlikely developers will credit the applicable GST in favour of the purchaser at the time of closing, and have the purchaser assign the applicable GST rebate directly to them.
Before Royal Assent is received, where a house is purchased from a builder and ownership is transferred to an individual, the builder may credit the existing GST/HST New Housing Rebate if applicable, but not the First-Time Home Buyer GST/HST Rebate. In such a case, the individual would need to pay the GST/HST and, where the First-Time Home Buyer GST/HST Rebate conditions are met, apply separately to the CRA for the rebate after royal assent is received.
After Royal Assent is received, when a house is purchased from a builder, the builder may credit the First-Time Home Buyer GST/HST Rebate in the same manner as the existing GST/HST New Housing Rebate against the total amount payable by the individual for the house, provided that the First-Time Home Buyer GST/HST Rebate conditions are met.
Updates are in progress to add information about the First-Time Home Buyer GST/HST Rebate on Canada.ca.
Take the next step: do you qualify for the 2025 GST relief program?
Are you looking to purchase your first home? Contact us today for a no obligations consultation! We’ll review your potential eligibility for the GST relief program and other benefits for first-time home buyers, help you calculate your savings to see how much home you can afford without overextending your budget, then connect you with lenders who match your financial goals. Throughout the entire process from pre-approval to closing, you’ll work closely with our friendly, experienced team right here in Victoria, BC.