Removing taxes on newly built homes has helped to increase sales by nearly 50 per cent in the Ottawa region, says the city’s home builders’ association.
The Greater Ottawa Home Builders’ Association’s mid-year report shows that nearly 2,700 new homes were sold in the region in the first six months of 2026, a 49 per cent hike compared to the same point last year.
The group credited the increase to the temporary removal of HST on all homes priced at $1 million or less. The joint federal-Ontario measure was introduced last spring and will expire at the end of March 2027.
Jason Burggraaf, executive director of the GOHBA, said the city’s latest move to cut developer charges could spur more sales activity in the near future.
“Every reduction helps improve affordability and bring more buyers into the market,” he said in a statement.
City council voted last week to drop developer charges by 54 per cent over the next years. This works out to a nearly $30,000 reduction in fees on new single-family homes.
The move was necessary to secure access to the provincial and federal developer charge reduction program. The schemes offers funding for municipalities for shovel-ready projects in exchange for slashing developer charges by 30 to 50 per cent.
Developer charges cover the cost of putting in place infrastructure necessary for new housing such as roads, sewers and wastewater treatment facilities. This is why developers pay more for greenfield developments in the far suburbs compared to already established neighbourhoods closer to the core.
Critics have accused municipalities of raising developer charges to help pay for other costs and avoid having to hike property taxes.
But defenders say the additional tax revenue from new homeowners won’t cover the cost of paying for the necessary infrastructure, and without developer charges, existing homeowners would have to subsidize new development.
