Mortgage Affordability Calculator Canada

Estimate how much home you may afford in Canada using household income, debts, down payment, mortgage rate, property costs, and lender ratios.

How much money comes in?

Your yearly income before taxiYour yearly employment income before tax.

Partner's yearly incomeiA partner's yearly income before tax, if you buy together.

Down payment and debt

Down payment availableiCash you can put toward the down payment and closing costs.

Total monthly debt paymentsiCar loans, credit cards, student loans, and other monthly minimums.

Mortgage and owner costs

ProvinceiUsed for land transfer tax and first-time buyer rebates.MunicipalityiToronto buyers pay municipal land transfer tax in addition to Ontario land transfer tax.

First-time buyeriApplies first-time buyer land transfer tax rebates, and allows a 30-year insured amortization.

Newly built homeiA newly built home allows a 30-year insured amortization for any buyer, and qualifies for BC's newly built home exemption.

Mortgage interest rateiThe contract rate you expect. The stress test adds a buffer on top.

AmortizationiLength of the mortgage. Longer lowers the payment but adds interest, and adds 0.20% to the insurance premium past 25 years.

years

Monthly property taxiEstimated monthly property tax for the home.

Monthly heat, utilities, and servicesiHeat, hydro, water, and basic home services each month.

Monthly condo or strata feesiSuggested starting point: $400 a month for condo or strata fees.

Monthly insurance and maintenanceiHome insurance and a maintenance allowance each month.

1. What you can afford

$213,712

$163,712 mortgage plus your $50,000 down payment

This is the highest price a typical Canadian lender would approve with your numbers, using the same debt limits and stress-test rate a bank applies.

Against the 4.5x rule

This calculator$213,712 home, 1.9x income

4.5x rule of thumb$432,500 home, 4.5x income

Below the rule. The rule ignores your $1,200 of monthly debt payments, the property tax and heating costs, and the stress-test rate. All of it takes room away from the mortgage.

2. Why this is the number

A lender starts from your income, caps how much of it can go to housing, subtracts everything else you owe, and tests what is left at a rate higher than the one you sign.

Monthly household income$85,000 a year before tax$7,083
Cap on housing costs and debts together (44% of income)Your debt payments push you into this limit before the 39% housing one$3,117
Car loans, credit cards, and other debtEvery dollar here is a dollar the mortgage cannot use- $1,200
Property tax, heat, and half of condo feesCounted as housing costs before anything reaches the mortgage- $770
Room left for the mortgage paymentThis is the ceiling a lender works back from$1,147
Tested at 7.0% over 25 years, that borrowsThe stress test uses your rate plus 2%, or 5.25%, whichever is higher$163,712

3. What it will cost you

Every month

$2,247

Cash on closing day

$54,050

The monthly figure uses the rate you entered. The closing-day figure is money you need before you get the keys, and it cannot come out of the mortgage.

Every month

Mortgage payment at your 5.00% rate$952

Property tax, heat, insurance, condo fees$1,295

Total each month$2,247

Same mortgage at the 7.0% test rateWhat the lender checks you against, and roughly what a higher renewal rate would feel like$1,147

On closing day

Your down payment$50,000

Land transfer tax$0

Legal and title buffer$2,200

Inspection and appraisal$950

Prepaid adjustments$900

Buyers who are not Canadian citizens or permanent residents may also owe the 25% Non-Resident Speculation Tax, plus 10% more in Toronto.

Total cash on closing day$54,050

The price above assumes your full $50,000 goes to the down payment, which leaves closing costs of about $4,050 to find elsewhere. Shopping roughly that much lower keeps the cash in one place.

Tax brackets, CPP, EI, mortgage insurance rules, and land transfer taxes last verified 2026-08-20 for the 2026 tax year.

What does mortgage affordability mean?

Mortgage affordability is the home price a household may be able to carry after income, existing debts, down payment, interest rate, property tax, heating, condo fees, and the qualifying stress test are considered together. It is a planning ceiling rather than a lender approval because credit, income stability, property details, and lender policy still matter.

With household income of $85,000, $50,000 available for the purchase, and $1,200 of monthly debt payments, the model estimates a home price near $213,712. That price produces a contract payment near $952, total monthly ownership costs near $2,247, and cash needed at closing of $54,050. Keep room below the calculated ceiling for repairs, utilities, insurance, and rate changes, then ask a lender or broker to test the same figures under its full underwriting rules.

Formula or decision method

Mortgage Affordability Calculator Canada decision method

The calculator converts income into a housing payment range, checks total debt against simplified service ratios, and tests the mortgage at the qualifying rate. It then works backward from the payment limit to an estimated home price after considering the down payment and housing costs.

Data provenance

The model uses the values entered above rather than silently substituting a household profile. Personal balances, prices, rates, dates, and household facts should come from current statements, quotes, or official records, while suggested assumptions should be tested above and below the starting case.

Sensitivity test

The same default scenario with only household income changed by ten percent in either direction.
Input	Calculated result
Household income: $108,000	$474,429
Household income: $120,000	$534,213
Household income: $132,000	$588,220

See the full Canadian mortgage planning path.

Use the hub to connect affordability, payments, down payment rules, approval basics, stress testing, closing costs, rent-vs-buy tradeoffs, and current housing context.

Open Mortgage & Home Buying Hub

Frequently asked questions

Does this guarantee approval?

No. Lenders also assess credit, employment, stress test rules, property type, and documentation.

Does it include heating?

Yes, it uses a simple default monthly heating cost in the debt ratio estimate.

What if I have a car loan or student loan?

Enter the monthly payment as other debt. Recurring debt can reduce the mortgage payment a lender may allow.

What if I plan to buy with a partner?

Use combined income and combined debt only if both people will be on the application. Also include shared down payment and realistic household costs.

Mortgage affordability by province

Use this calculator for mortgage affordability in Ontario, British Columbia, Alberta, Quebec, Manitoba, Saskatchewan, Nova Scotia, New Brunswick, Newfoundland and Labrador, Prince Edward Island, Yukon, Northwest Territories, and Nunavut. Province selection affects closing-cost assumptions such as land transfer tax, registration fees, and first-time buyer credits where available.

Ontario and BC mortgage affordability

Ontario and BC searches often need extra care because transfer taxes and first-time buyer credits can materially change cash needed to close. Test Ontario, Toronto, Vancouver, Victoria, and other BC or Ontario purchase scenarios by adjusting the province, down payment, property tax, condo or strata fees, and monthly owner costs.

How mortgage affordability works

Lenders compare your income against expected housing costs and other debt payments to estimate what payment you can carry.

Gross and total debt service ratios explained

Gross debt service focuses on housing costs. Total debt service includes housing plus other debt obligations.

Down payment rules in Canada

Down payment requirements and mortgage insurance depend on purchase price, property type, and program rules.

Disclaimer

Mortgage affordability depends on lender stress tests, debt ratios, down payment source, credit history, property taxes, condo fees, insurance, and current rates. Use this estimate as a planning filter before speaking with a lender or broker.

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Page details

Author: Thomas Tremblay

Updated: August 6, 2026

Cite: Canooq.ca, Mortgage Affordability Calculator Canada

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