New Build Closing Costs in Alberta: GST, Deposits, and What People Miss

A new build in Alberta doesn't close like a resale home. GST applies to the purchase price, your deposit gets paid in stages instead of all at once, and a home warranty gets attached to the property whether you ask for it or not. I get asked about this constantly from buyers relocating from Ontario and BC, because Alberta's rules genuinely work differently.

As we covered in this week's video comparing income in Toronto and Edmonton, Alberta has no provincial land transfer tax at any level [YOUTUBE LINK: add once video is live]. That's real money back in your pocket on any purchase. But new construction has its own separate cost structure, and it's the piece buyers miss most often. Here's what actually happens with GST, deposits, and warranty coverage on a new build in the Edmonton area.

How Much GST Do You Pay on a New Build in Alberta?

A 5% federal GST applies to the purchase price of a newly built home in Alberta, with no separate provincial sales tax added on top since Alberta doesn't charge PST (WOWA.ca, 2026). On a $550,000 new build, that's $27,500 in GST before any rebate is applied.

Here's where people get tripped up. Some builders advertise a price that already has GST baked in, net of the expected rebate. Others quote a base price and add GST separately at closing. There's no universal standard, and I've seen buyers assume they were getting a deal on a listing price that turned out to be pre-tax. Always ask the builder point-blank whether the quoted price includes GST or not, and get it in writing before you sign.

If you want the full picture on Alberta's broader closing cost structure, including why there's no land transfer tax to budget for here, see our resale closing costs breakdown. This post focuses specifically on the costs unique to new construction.

What's the GST Rebate, and Do You Qualify?

There are actually two different GST rebates that can apply to a new build, and mixing them up is the single most common mistake I see. The older program refunds 36% of the GST paid, up to a maximum of $6,300, but it only applies in full below $350,000 and phases out completely by $450,000 (CRA, Amounts Eligible for Section 256 GST New Housing Rebate). Those thresholds were set in 1991 and have never been adjusted for inflation, which is why almost no new build in the Edmonton area still qualifies for it at full value.

The newer program is the one that actually matters for most buyers today. Eligible first-time buyers can get up to 100% of the GST rebated on homes priced at $1 million or less, worth as much as $50,000, with the rebate phasing down between $1 million and $1.5 million and disappearing above that (Canada Revenue Agency, 2025). It applies to purchase agreements signed on or after March 20, 2025, and the home has to be substantially complete before 2036.

On a $600,000 new build, a qualifying first-time buyer could see the full $30,000 in GST rebated back, compared to zero under the old program since the home sits above the $450,000 cutoff. That's not a rounding error. It's the difference between a program that stopped mattering decades ago and one that can genuinely change your affordability math.

First-Time Buyer? Here's How the Rebate Actually Gets Applied

To qualify as a first-time buyer for this rebate, you generally can't have owned and occupied a home as your primary residence in the year of purchase or the four calendar years before it, you need to be 18 or older, and you need to be a Canadian citizen or permanent resident buying the home as your own primary residence and its first occupant (Sterling Homes Edmonton, 2026).

In my experience walking clients through this, most builders in the Edmonton area handle the rebate by simply crediting it against your purchase price up front, so your Statement of Adjustments shows GST net of the rebate rather than the full amount. That's the easy path. If your purchase agreement says something like "purchase price includes GST net of rebate," the builder has already claimed it on your behalf. If you're doing a custom build, an assignment, or another situation where you paid the full GST at closing, you'll need to apply directly to the CRA yourself using your CRA My Account, which means keeping every closing document organized because you'll need them.

Double-check your Statement of Adjustments before removing financing conditions. Our full walkthrough of the condition period and possession day is worth reviewing here, since GST rebate confusion tends to surface at the same stage as financing and inspection conditions on a new build.

How Builder Deposits Work Differently Than Resale

On a resale purchase, you pay one deposit, typically $5,000 to $10,000, within five business days of an accepted offer. New builds don't work that way. Deposits on Edmonton-area new construction usually total 5% to 10% of the purchase price, and that amount gets split across two or three separate installments tied to specific milestones instead of paid all at once (New Homes Alberta, 2026).

A common structure looks like this: an initial deposit when you sign the purchase agreement, often around 5%, followed by a second installment at a defined point in the construction timeline. Every builder writes this differently, so read your specific purchase agreement closely rather than assuming it matches what a friend's builder did. Deposit installment timing is one of the more negotiable terms in a new build contract, along with delayed possession windows and assignment rights.

• Resale: one deposit, due within 5 business days of acceptance, held in trust until possession.
• New build: staged deposits totaling 5% to 10%, tied to contract signing and construction milestones over months.

The Alberta New Home Warranty You Can't Opt Out Of

Every new home built in Alberta since February 1, 2014 carries mandatory warranty coverage under the New Home Buyer Protection Act, structured on a 1-2-5-10 year schedule: one year for materials and labour, two years for delivery and distribution systems like electrical, plumbing, and HVAC, five years for the building envelope, and ten years for major structural components (Alberta New Home Warranty Program). Builders don't get to skip this. They have to enroll every home with a licensed warranty provider before it can legally sell.

Coverage is capped at the lesser of your purchase price, excluding land, or $265,000 for a single-family home, and $130,000 per unit for condos, with common property in multi-family buildings covered up to $3.3 million (Alberta New Home Warranty Program). That premium isn't a separate line item you negotiate. Builders typically fold it into the price, and industry estimates put the actual cost at under 1% of the home price, roughly $1,700 to $2,500 for an average Edmonton-area new build (Sterling Homes Edmonton, 2026).

Deposit Protection: The Piece Most Buyers Assume Is Automatic

Here's the gap I see most often, and it's worth calling out on its own. The mandatory 1-2-5-10 warranty protects your home after possession. It does not automatically protect the deposit money you hand a builder before the house even exists. That's a separate coverage called pre-possession or deposit protection insurance, and it's not identical on every deal.

Where it's in place, deposit protection insurance covers the lesser of the amount you've actually paid or 20% of the purchase price, up to a maximum of $100,000 for a single-family home, or $50,000 for a multi-family unit, running from the day you pay your deposit until the mandatory warranty coverage takes over at possession (Alberta New Home Warranty Program, Pre-Possession Insurance). If a builder goes under mid-project, this is what stands between you and losing tens of thousands of dollars. Ask your builder directly which warranty provider they use and confirm your deposit protection coverage in writing. Don't assume it's identical to what the mandatory structural warranty covers, because it isn't the same product.

Financing a New Build with a Progress-Draw Mortgage

Some large-volume Edmonton builders offer completion mortgages, where the builder carries construction financing and you only start paying your mortgage at possession. Custom and semi-custom builds more often use a progress-draw construction mortgage instead, where your lender releases funds in stages as the home is built and inspected, typically 3 to 5 draws tied to milestones like the foundation, lock-up, and completion (Best Rates, New Construction Mortgages in Edmonton, 2026).

Each draw requires its own physical inspection before your lender releases funds, and the whole sequence often spans 8 to 14 months from first draw to final. If you're relocating and pre-approving a mortgage from out of province, ask specifically for a rate hold long enough to cover the build, since 2026 new build pre-approvals often need 12 to 18 month holds rather than the standard 90 to 120 days on resale.

Possession Day Adjustments on a New Build

New build closing costs on top of GST and your deposit still include legal fees, land title registration, and property tax adjustments, similar to resale, but the numbers work differently because the property didn't exist for tax purposes until construction finished. Your first year's property tax bill is often based on a partial assessment, so expect an adjustment once the municipality catches up. Budget the standard $1,500 to $4,000 range for legal fees, title registration, and inspection-related costs on top of your GST and deposit obligations.

Your final walkthrough with the builder typically happens in the two days before possession, not on possession day itself, which gives you a real chance to flag deficiencies before you're legally responsible for the home. This is also where I tell every client to slow down and read the Certificate of Possession language closely, since new build possession documents differ from a resale Statement of Adjustments in ways that catch people off guard. Read our full possession day walkthrough for what to expect that morning.

Frequently Asked Questions

Buying new construction in Alberta isn't more expensive than resale, but it front-loads different costs at different points, and the deposit protection gap is the one that actually worries me for buyers moving here from out of province. Ask your builder for their warranty provider and deposit protection terms before you sign anything, not after. If you want a second set of eyes on a purchase agreement before you commit, that's exactly what I'm here for.