How much house can I afford?
Enter your income, debts and down payment. We apply Canada’s stress test, lender debt ratios, minimum down payment rules and mortgage default insurance to estimate your maximum home price.
Estimate only. Lenders’ actual limits, insurer rules and your credit profile will change the result. Excludes closing costs such as land transfer tax, legal fees and inspections.
How this calculator works
Canadian lenders decide how much you can borrow using a few rules. This calculator applies all of them and shows you the one that limits you.
1. The stress test
You must qualify at the higher of 5.25% or your rate plus 2%. You’ll still pay your real rate; the stress test only affects how much you can borrow.
2. Debt service ratios
- Gross debt service (GDS): mortgage payment at the stress-test rate, property tax, heating and half of condo fees, up to about 39% of gross income.
- Total debt service (TDS): all of the above plus your other monthly debts, up to about 44% of gross income.
3. Minimum down payment
5% on the first $500,000 and 10% on the rest, for homes under $1.5 million. Homes of $1.5 million or more need 20% down. If your down payment is the limit, saving more raises your maximum price faster than income does.
4. Mortgage default insurance
With less than 20% down, a premium of 2.8% to 4% of the mortgage is added to your loan. That added amount counts toward what you can borrow.
Affordability questions
How much house can I afford in Canada?
Lenders look at two ratios. Your housing costs (mortgage payment, property tax, heating and half of any condo fee) usually need to stay under about 39% of your gross income, and all your debts together under about 44%. You also have to qualify at the stress-test rate.
What is the mortgage stress test?
You must qualify at the higher of 5.25% or your contract rate plus 2%. You still pay your actual rate; the stress test just makes sure you could handle a rate increase.
What is the minimum down payment in Canada?
For homes under $1.5 million: 5% of the first $500,000 and 10% of the portion above $500,000. Homes of $1.5 million or more need at least 20% down.
What is mortgage default insurance?
If you put less than 20% down, your mortgage needs default insurance (from CMHC, Sagen or Canada Guaranty). The premium is usually 2.8% to 4% of the mortgage, depending on your down payment, and is added to your loan.
Can I get a 30-year amortization?
Insured mortgages are limited to 25 years, except for first-time buyers and buyers of newly built homes, who can get 30 years. Uninsured mortgages (20% or more down) can usually go to 30 years.
Disclaimer: General information only, not financial, legal or tax advice. Rules, taxes and rebates change; confirm current details with a qualified professional, your lawyer and your lender. TheCanadianMortgage.ca is not a lender. Rates are for illustration and subject to approval (OAC).