Canada's new minority government is getting ready to take power, after more than a decade of Liberal rule. The Conservatives say they have five priorities: government accountability, improving patient wait times in the health care system, child care, cracking down on crime, and cutting the Goods and Services Tax.

Housing issues did not take centre stage during the recent campaign, but cutting the GST will have a big impact on new home buyers.

Visiting a home building site on January 19, Prime Minister Elect Stephen Harper announced that in addition to cutting the GST from seven to six per cent, and eventually to five per cent, the Conservatives would also maintain the GST New Housing Rebate. The savings on a new $200,000 home would be $2,000, growing to $4,000 once the GST cut is fully implemented. In addition, at six per cent GST, the rebate on a $200,000 home would be $4,320 and at five per cent, the rebate would be $3,600.

The Canadian Home Builders' Association (CHBA) issued a statement that it welcomed Harper's GST proposal. "We anticipated from previous Conservative statements that reductions in the GST rate would significantly benefit new home buyers," said David Wassmansdorf, CHBA president. "It is good to have this confirmed. This Conservative proposal would open the door to a plan to keep the GST rebate in line with changes in housing prices on a permanent basis, though indexation."

The CHBA says the proposals would restore the effective rate of federal sales taxes on new homes to the level that applied prior to the introduction of the GST in 1991. "Our association has been urging that this be done since the GST was first introduced," Wassmandorf said.

At the same pre-election event at the new home site, Harper said the plan to cut the GST would also help the residential construction industry. He said residential construction will contribute nearly $26 billion to Canada's GDP this year.

"New home construction shows a community on the move. The sight of work crews building new neighbourhoods is a sign of our hope and our optimism about a better future for our families," Harper said. "As we all understand, a home-building nation is a strong nation."

The Urban Development Institute, Ontario chapter was also pleased with the GST proposal and Harper's comments, stating that it "sees it as a positive signal for consumers to purchase a new home and ensure the long-term health of the development and construction industry."

Early in the campaign, the Conservatives also promised to build more affordable housing. On January 12, Harper said his government would "work with the provinces and municipalities to develop tax incentives for private-sector builders so that low-income city dwellers will have improved access to affordable housing."

"Specifically, to supplement existing programs, on an experimental basis we will establish a low-income housing tax credit program to encourage developers to build or refurbish affordable rental units for low-income Canadians."

The budget for the plan is $200 million per year, starting in 2007. "This is not a phony promise or a quick fix -- it is a genuine, practical plan to do something to increase the supply of affordable housing," said Harper.

Liberal candidate Eleni Bakopanos responded that, "It's very clear that the Conservatives do not believe in the basic concept of social housing ... Stephen Harper is trying to disguise another tax cut and call it social housing." Bakopanos was defeated by a Bloc Québécois candidate in her riding.

The CHBA noted that in the past there have been a variety of incentives for the production of market rental housing, "and all have had disappointing results."

"Nevertheless, the Conservative party's plan does open the door to serious discussion about tax reforms that will invigorate the rental market. This is much more welcome than a continuation of social housing production based on inordinately expensive capital grants," says CHBA.

The association also approved of several other components of the Conservative's platform. It says the party's proposed support for apprenticeship training, which includes a grant of $1,000 a year to new apprentices for two years, a credit that offers employers a 10 per cent reduction on taxes paid on wages paid to apprentices, and a tools tax deduction, represents "a tangible step" in addressing skilled labour shortages.

The home builders' association also approved of the Conservatives' position on municipal infrastructure, and a plan to reduce the tax load on small business. The CHBA sent out a questionnaire to all parties to ask for their positions on new housing issues. The responses are available here .