The federal government has announced that effective immediately they will no longer charge their portion of the HST on new rental units built. Ontario then announced they plan to end the provincial portion of the HST as soon as possible.
Why End The HST When Building New Rental Units?
Canada has an aging population, declining birth rate, and fewer domestic born workers. This is seen as a danger to the Canadian economy over the long term. As a result, the federal government has been increasing the number of immigrants allowed into the county.
In 2022 there were about 500,000 people let into the country.
Canada was already experiencing a shortage of housing before the increased immigration. Now it has gotten significantly worse, and projections say this will continue. If the government continues to admit immigrants at this pace, by 2030, we would need over two million additional housing units just for the immigrants
Whether you like the federal government strategy on lowering birth rates or not, it has resulted in lowering HST on new rental builds. At the same time, there is a need for more rental units and prices are increasing. This is a great scenario for profitability.
Start Building Without The HST
Looking to get into building multifamily units or apartments? Give me a call at 807-285-7777 to talk about your situation, and I will let you know how to best take advantage of the new HST changes.