Mortgage Affordability Calculator Canada

Lenders do not ask what a home costs. They ask what your income can carry under the stress test, using the gross debt service (GDS) and total debt service (TDS) ratios. This calculator applies those same ratios, at the qualifying rate, to show the maximum mortgage and home price a lender is likely to approve.

Total household gross income per year ($)Down payment you have saved ($)Contract mortgage rate you expect (%)Amortization (years)Monthly property tax on the home ($)Monthly heating cost ($)Other monthly debt payments: car, cards, loans ($)Monthly condo fees, if any ($)

Uses GDS 39% and TDS 44% (the CMHC insured limits) and a qualifying rate of the higher of your contract rate + 2% or 5.25%. Half of condo fees count in the ratios, per lender rules. Individual lenders and insurers apply their own conditions.

How it works

GDS divides your housing costs (mortgage payment at the qualifying rate, property tax, heating, and half of condo fees) by gross income and caps the result at 39% for an insured mortgage. TDS adds every other debt payment and caps the total at 44%. Whichever ratio leaves less room for a mortgage payment sets your maximum.

The stress test is the quiet giant in the calculation. You must qualify at your contract rate plus 2 percentage points, or 5.25%, whichever is higher, even though your actual payments are made at the lower contract rate. That gap is why a rate rise cuts buying power before it cuts anyone’s actual payment.

Worked example

The calculator’s own output for a $120,000 household income, a $100,000 down payment, a 4.50% contract rate (6.50% qualifying), $550 a month of tax and heating, and $300 of other debts:

Item	Amount
Household income / down payment	$120,000.00 / $100,000.00
Contract rate / qualifying rate	4.50% / 6.50%
Property tax + heating	$400.00 + $150.00 a month
Other debts	$300.00 a month
Monthly amount available for a mortgage payment	$3,350.00 (GDS is the binding limit)
Maximum mortgage	$500,131.54
Maximum home price	$600,131.54

Frequently asked questions

What is the mortgage stress test in Canada?

You must qualify at the higher of your contract rate plus 2% or the 5.25% floor (the minimum qualifying rate). It applies to insured and most uninsured mortgages, with limited exceptions for straight renewals with your current lender.

How much income do I need for a $600,000 home?

Working backwards from the example on this page: a $600,131 home with $100,000 down needed a $120,000 household income under the stated costs. Higher property taxes, condo fees or other debts raise the income needed for the same price.

Does a bigger down payment always help?

It raises the maximum price dollar for dollar and, at 20% or more, removes the mortgage insurance premium. But the income ratios still cap the mortgage itself, so a down payment cannot fix an income shortfall.

Are the GDS and TDS limits the same everywhere?

39% and 44% are the CMHC insured limits used here. Conventional (uninsured) lenders often use similar or slightly different limits, and credit unions are provincially regulated and may vary.

Do lenders count bonuses, overtime or rental income?

Often yes, usually averaged over two years with tax documents to prove them, and rental income is typically offset or added back under lender-specific formulas. Self-employment income is almost always a two-year average of your tax returns.

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For education only. This calculator gives estimates, not financial, tax or legal advice. Figures use 2026 rates where a rate is built in; confirm your own numbers before making a decision.