A re-elected Conservative government would offer first-time homebuyers a new tax credit of up to $5,000 to help cover closing costs, Conservative Leader Stephen Harper said on Monday.

The move would result in a maximum tax return rebate of $750 per family, Harper said during a campaign appearance in Kitchener, Ont.

Demonstrators, including some Canadian Auto Workers members, tried to disrupt the announcement by protesting recent manufacturing job losses in the area.

Harper defended his government's action to help single industries, giving the example of the recent $80-million auto innovation grant to Ford to keep plants operating in Windsor and St. Catharines, both in Ontario.

The Conservative leader said the plan would help families achieve their dreams of owning a home, while also providing a boost to the Canadian construction industry, which employs 1.2 million people across the country.

"It will help make homeownership more affordable, and it will help create jobs," Harper said, noting that almost 300,000 Canadians bought a first house last year.

He acknowledged that the closing costs on home sales can sometimes equal up to four per cent of the final sale price, often forcing Canadians to go beyond their budgets or postpone their purchases.

The average selling price of a home in this country will rise by 3.3 per cent this year to $317,450, and by a further three in 2009 to $327,000, Canada Mortgage and Housing Corporation predicted last month.

The announcement is the latest in a series of what the Tories are describing as modest proposals to aid Canadian families in a time of economic uncertainty, instead of the Liberals' Green Shift plan to provide income tax cuts through taxing carbon fuels.

Harper said Canadians will have to choose on Oct. 14 whether they want a "stable, well thought out" plan and a "grand scheme that hasn't been thought through and is being made up on the fly.

"Our plan is simple, modest and practical," Harper said. "We're operating on a long-term plan, and we're also announcing measures that we know we can actually follow through on, not a bunch of wild spending and taxation schemes."

Speaking to a crowd at a John Deere plant slated for closure in Welland, Ont., New Democrat Leader Jack Layton attacked the Tories for focusing on tax cuts rather than employment levels.

"So Mr. Harper is in the manufacturing heartland of Ontario and he's completely dismissing the crisis of job loss here," Layton said. "It just shows he doesn't get it.

"He's been spending far too much time at the boardroom tables with his ministers talking about how to give tax cuts to his friends."

The NDP campaign dismissed the Conservative tax credit proposal as little help to homebuyers, amounting to 0.2 per cent of the cost of an average home.

"The best way to help new home buyers afford a home is helping them keep their good jobs with good wages, not dribbling tax cuts like the one Stephen Harper offered today in Kitchener," an NDP press release said.