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How Much Home Can You Afford in Canada?
Canadian lenders qualify you using the stress test at max(rate + 2%, 5.25%), plus GDS and TDS debt ratio caps. Get your actual lender-qualifying number — not an oversimplified estimate.
Educational calculators — always consult a licensed professional before making financial decisions.
Your finances
Gross, before tax — the salary on an employment letter, or total income (line 15000) on your Notice of Assessment. A co-applicant's income is added to yours for GDS and TDS.
Before tax. Include all employment income, self-employment net, rental income.
Enter C$0 if you're applying alone.
C$10,000/mo gross household income
Minimum monthly payments on car loans, student loans, lines of credit and credit cards. They count against the 44% TDS limit, not GDS.
Savings, FHSA and RRSP Home Buyers' Plan money together. Canada's 5% / 10% / 20% legal minimums can cap your price before your income does.
Years to pay the loan off — not your term. It sizes the qualifying payment; the 1–5 year term only sets when you renew.
Standard Canadian amortization. Balances payment and interest cost.
Both go into the 39% GDS ratio alongside principal and interest. Use the municipal tax on the listing if you have one; lenders add a standard heat figure whether or not you have a bill.
Counts in full toward your GDS ratio. The default is a placeholder, not a published rate.
Lenders add a standard heat estimate to your GDS ratio whether or not you have a bill.
C$567/mo counted toward GDS before the mortgage payment
The rate you expect to be offered. You are qualified at a higher OSFI B-20 stress-test rate, not at this one.
Stress-tested at 7.09% — the greater of your rate + 2% or the 5.25% floor
Maximum Purchase Price
C$559,296
Capped by the 39% GDS ceiling at the OSFI B-20 qualifying rate
What caps your price
The lower of the two is your answer. Your C$100,000 down payment clears Canada’s legal minimum at this price (C$30,930), so income is the binding limit — through the 39% GDS ceiling. All figures CAD.
CMHC mortgage default insurance
Under 20% down, CMHC mortgage default insurance is mandatory in Canada and the premium is added to the mortgage rather than paid at closing — so the lender amortizes C$472,156, not C$459,296, and the premium uses up borrowing room that would otherwise have gone into the purchase price. This is not US private mortgage insurance: it is a one-time premium on the loan, not a monthly charge you cancel at 20% equity, and it insures the lender rather than you. Provincial sales tax on the premium (Ontario, Quebec and Saskatchewan only) cannot be added to the loan and is cash at closing — see the CMHC insurance calculator. All figures CAD.
GDS Ratio
39.0%
✗ Exceeds 39% limit
TDS Ratio
44.0%
✗ Exceeds 44% limit
OSFI B-20 Mortgage Stress Test
The minimum qualifying rate is the greater of your contract rate plus 2% or the 5.25% floor. Yours is set by contract rate + 2% (5.09% + 2%). Your maximum mortgage above is calculated at this rate, not at your contract rate.
Qualified at 7.09% you can buy up to C$559,296. At your 5.09% contract rate the same income and debts would support C$651,030 — all figures CAD. The gap is what B-20 costs you, not a rate you can borrow at.
Source: Office of the Superintendent of Financial Institutions (OSFI), Guideline B-20 — Residential Mortgage Underwriting Practices and Procedures. Minimum qualifying rate for uninsured mortgages: the greater of the contract rate plus 2% or 5.25%. OSFI page last updated January 29, 2026; OSFI reaffirmed the rate unchanged in January 2026. Checked August 21, 2026. Figures in CAD.
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What you'll need
- Your gross annual income (and co-applicant's, if any)
- Monthly debt payments (car loans, student loans, credit card minimums)
- Your available down payment
- Your amortization period — 20, 25 or 30 years (not your term)
- Your expected mortgage rate
- Optional: the annual property tax and monthly heat estimate for your target home, both of which count toward GDS
What you'll get
- Max purchase price — Under the stress test
- GDS & TDS ratios — See where you stand vs. limits
- OSFI B-20 qualifying rate — The greater of your contract rate + 2% or the 5.25% floor — the rate lenders actually qualify you at
- Stress test result — Whether you pass at that qualifying rate, shown as a named pass/fail row
- Which limit caps your price — Your income ceiling and your down-payment ceiling side by side, with the lower one named — Canada's 5/10/20% minimum down payment is a hard cap, not just a cash contribution
- CMHC premium, in CAD — Under 20% down: the premium rate, the dollar premium, and the loan it is capitalized into — the mechanic that replaces US PMI
How it works
Enter your income
Gross annual income for you and any co-applicant. Include employment, self-employment, and rental income.
Add debts & down payment
Monthly debt payments (car, student loans, credit cards) and your available down payment amount.
Get your stress-tested limit
We apply the OSFI B-20 stress test at max(your rate + 2%, 5.25%) and apply 39% GDS and 44% TDS caps.
- Qualified at the OSFI B-20 rate
- The greater of your contract rate + 2% or the 5.25% floor — never the rate you were quoted.
- Semi-annual compounding
- Canadian fixed-rate mortgages compound twice a year by law, not monthly like a US loan.
- Amortization, not term
- Amortization (20/25/30 years) sizes the qualifying payment. Your term is when you renew and does not change what you can afford.
- CMHC premiums and the legal minimum down payment
- Under 20% down the CMHC premium is capitalized into the loan, and 5/10/20% minimums cap the price outright. No PMI, no FHA, no 30-year fixed.
Maximum Affordability by Income (Stress Test at 7.09%)
| Gross Income | C$50K Down | C$100K Down | C$200K Down |
|---|---|---|---|
| C$80,000 | ~C$320K | ~C$380K | ~C$480K |
| C$120,000 | ~C$500K | ~C$580K | ~C$700K |
| C$160,000 | ~C$680K | ~C$780K | ~C$940K |
| C$200,000 | ~C$860K | ~C$980K | ~C$1.18M |
Estimates at 5.09% contract rate (stress tests at 7.09%). Assumes C$5K/yr property tax, C$150/mo heat, no other debts.
Authoritative resources
- OSFI B-20 — Residential Mortgage Underwriting Practices
- OSFI — Minimum qualifying rate for uninsured mortgages
- Bank of Canada — Canadian Interest Rates
The minimum qualifying rate used by this calculator — the greater of your contract rate plus 2% or a 5.25% floor — is set by OSFI Guideline B-20. OSFI's own minimum-qualifying-rate page was last updated January 29, 2026, and OSFI reaffirmed the rate unchanged in January 2026. Checked August 21, 2026. All amounts in CAD.
Worked example: GDS and TDS, and which one binds
A US debt-to-income underwrite has no equivalent to this step — it caps total debt against income and stops there. Canadian lenders run two separate ratios, and the lower of the two is what actually limits you. Take a household with C$150,000 combined gross income (C$12,500/mo), a C$380/mo car loan and a C$170/mo student loan payment (C$550/mo in other debt), C$4,800/yr property tax (C$400/mo), and CMHC’s standard C$150/mo heating estimate:
- GDS ceiling — 39% of C$12,500 = C$4,875/mo available for principal, interest, property tax and heat (PITH) combined.
- TDS ceiling — 44% of C$12,500 = C$5,500/mo available for PITH plus every other debt payment. Subtract the C$550/mo in other debt: C$4,950/mo is left for PITH under TDS alone.
- GDS binds — C$4,875 is lower than the C$4,950 TDS leaves, so GDS is the operative limit here, not TDS. Subtract the C$550/mo in property tax and heat: C$4,325/mo remains for principal and interest.
That C$4,325/mo is what the calculator above amortizes into a maximum mortgage — at the OSFI-B-20 qualifying rate (contract rate + 2%, or the 5.25% floor, whichever is higher) and Canada’s semi-annual compounding, not the monthly compounding a US calculator would apply. Change either debt load or the property’s tax/heat estimate above and watch which ceiling binds — for a household with heavier non-mortgage debt, TDS typically becomes the tighter limit instead.
Worked example: why your down payment can cap your price before your income does
Take an Ontario buyer — the province enters this calculation through the property tax figure; the stress test and the GDS/TDS ratios are federal and identical in every province. Household income C$300,000 gross (C$25,000/mo), no other monthly debt, C$20,000 saved, a 5.09% contract rate, 25-year amortization, C$5,000/yr property tax (C$416.67/mo) and a C$150/mo heat estimate. The qualifying rate is max(5.09% + 2%, 5.25%) = 7.09%.
- GDS ceiling — 39% of C$25,000 = C$9,750/mo; less C$416.67 tax and C$150 heat leaves C$9,183.33/mo for principal and interest. TDS leaves C$10,433.33, so GDS binds.
- What that payment borrows — at 7.09% compounded semi-annually over 300 months, C$9,183.33/mo supports a loan of C$1,300,790.
- Before this fix — the calculator returned C$1,300,790 + C$20,000 = C$1,320,790. The legal minimum down payment on a C$1,320,790 home is C$25,000 + 10% × C$820,790 = C$107,079. The buyer has C$20,000, so that price was unpurchasable — not a rounding difference.
- After this fix — C$20,000 meets Canada’s 5% minimum only up to C$20,000 ÷ 0.05 = C$400,000, and that is the answer. The down payment binds, not the income. At C$400,000 the down payment is 5.0%, so the mortgage is CMHC-insured at the 4.00% premium tier: the C$380,000 base loan carries a C$15,200 premium, the lender amortizes C$395,200, and the payment is C$2,790/mo at the qualifying rate.
The same correction moves the calculator’s own default case, because the CMHC premium was never charged against borrowing capacity either. On the defaults (C$120,000 income, C$500/mo debts, C$100,000 down, 5.09%, 25 years) the maximum purchase price was C$572,156 and is now C$559,296: the down payment is 17.88%, so the mortgage is insured at CMHC’s 2.80% tier, and the C$12,860 premium on the C$459,296 base loan is capitalized rather than ignored. The old figure counted that C$12,860 twice — once as a premium the lender adds to the loan, and once as purchasing power. Canada’s minimum down payment bands (5% on the first C$500,000, 10% to C$1,500,000, 20% above, where CMHC insurance is unavailable) have been in force since December 15, 2024; the premium tiers are CMHC’s own loan-to-value table, checked August 26, 2026. All amounts CAD.
25-year vs 30-year amortization: what the extra 5 years buys, and what it costs
A US affordability calculator treats amortization length as a free lever — stretch it and the payment drops with no other consequence. In Canada it is not free: since August 1, 2024, CMHC adds a 0.20% surcharge to the insurance premium on any insured mortgage amortized over 25 years, and a 30-year amortization on an insured (under-20%-down) mortgage is available only to first-time buyers or purchasers of new construction — not to every buyer who wants one.
Take the same household as the default case above — C$120,000 gross income, C$500/mo other debt, C$100,000 down, a 5.09% contract rate (qualifying at 7.09%), C$5,000/yr property tax, C$150/mo heat. GDS caps the qualifying payment at the same C$3,333.33/mo regardless of amortization — GDS is an income test, not an amortization test — but a longer amortization spreads that fixed payment over more months, so it supports a larger loan:
- 25-year amortization — supports a C$472,156 insured loan at the standard 2.80% premium tier (C$12,860 premium on a C$459,296 base loan), for a maximum purchase price of C$559,296. Down payment is 17.88% of price.
- 30-year amortization — the same C$3,333.33 monthly capacity now supports a C$501,659 insured loan, but at the 26-30-year tier the premium rate is 2.80% + 0.20% surcharge = 3.00% (C$14,611 premium on a C$487,047 base loan), for a maximum purchase price of C$587,047. Down payment falls to 17.03% of the higher price.
The 30-year path buys C$27,751 more purchasing power at an identical monthly payment — but only if the buyer actually qualifies for it. A repeat buyer putting less than 20% down on an existing home cannot select 30 years at all under CMHC’s 2024 rules; only a first-time buyer or a new-construction purchase is eligible for the insured 30-year term. Source: CMHC, “CMHC revises homeowner mortgage loan insurance premiums” (0.20% surcharge for 26–30-year amortization, effective August 1, 2024), cmhc-schl.gc.ca, checked September 22, 2026. All amounts in CAD.
“Mortgage affordability” vs. “mortgage approval” vs. “mortgage qualification”
These three terms describe the same OSFI-governed math, not three different processes. A mortgage affordability calculator and a mortgage qualification calculator both mean the same thing in Canada: how much a lender will let you borrow once GDS (39%), TDS (44%), and the OSFI B-20 stress test are applied. A mortgage approval is the step after that — a lender underwriting your specific file (credit, employment verification, the property itself) against the number this calculator estimates. This tool answers the qualification question — the ceiling every federally regulated lender applies before it ever looks at your file — not the approval decision itself, which only a lender can issue.
Why Canadian payments differ from American ones
Canadian mortgage interest is compounded semi-annually, not in advance — a requirement of the federal Interest Act — while US mortgages compound monthly. At the same posted rate, the Canadian payment comes out slightly lower.
It is a small difference per month and a large one over an amortization, and it is why a US mortgage calculator gives the wrong answer for a Canadian mortgage. Every calculator on this site’s Canadian pages uses the semi-annual convention.
Term is not amortization
The amortization is how long the mortgage takes to pay off — commonly 25 years. The term is how long your current rate and contract last, usually one to five years. At the end of the term the balance comes due and you renew, at whatever rates exist then.
This is the structural difference from a US 30-year fixed, where the rate is locked for the whole amortization. A Canadian borrower re-prices every few years, which is why what happens at renewal matters as much as the rate you start on.
When mortgage insurance is mandatory
Put down less than 20% and mortgage loan insurance is compulsory, not optional. The premium runs from 2.8% of the loan at 15–19.99% down up to 4% at 5–9.99% down, and it is normally added to the mortgage rather than paid up front — so you pay interest on it for the life of the loan.
Two limits are worth knowing. Insurance is unavailable above C$1.5M, so above that price 20% down is effectively mandatory. And in most provinces the PST on the premium must be paid in cash at closing — it cannot be rolled into the mortgage.
Since 15 December 2024, a 30-year insured amortization is available to all first-time buyers, whether resale or new build, and to any buyer of a new build. It lowers the monthly payment and raises total interest, and it carries a 0.2% premium surcharge — worth modelling both ways in the CMHC insurance calculator before choosing.
What the payment does not include
- Land transfer tax, due in cash at closing and charged twice in Toronto, where a municipal tax stacks on the provincial one. See the land transfer tax calculator.
- Property tax, set by your municipality and often collected by the lender alongside the payment.
- Condo fees, which lenders count against your qualifying ratios — commonly at 50% of the monthly fee.
- Legal fees, title insurance and the home inspection, all payable at closing from the same savings as the down payment.
Frequently asked questions
What is the Canadian mortgage stress test?
The Canadian mortgage stress test (OSFI B-20) requires lenders to qualify borrowers at the greater of: their contract interest rate plus 2%, or 5.25%. This ensures borrowers can still afford payments if rates rise. It applies to all federally regulated lenders.
What are GDS and TDS ratios in Canada?
GDS (Gross Debt Service) ratio is the percentage of gross monthly income used for housing costs (mortgage principal and interest, property tax, heat, and 50% of condo fees). The limit is 39%. TDS (Total Debt Service) adds all other debt payments and is limited to 44%.
How much home can I afford in Canada on a C$120,000 salary?
On C$120,000 gross income with C$100,000 down payment and no other debts, the Canadian stress test qualifies you for approximately C$600,000–C$700,000 depending on the current mortgage rate. Use this calculator to get your specific number.
Does the stress test apply to renewals?
No, in most renewal cases. Staying with your current lender has never required the stress test. Since late 2024, OSFI and the Department of Finance also exempt a 'straight switch' — moving to another federally regulated lender at renewal with no more than C$3,000 added to the balance and no extension of your amortization — from the stress test. The stress test still applies if your switch adds more than C$3,000, extends your amortization, or if you're taking out a new mortgage to buy.
Is a mortgage affordability calculator the same as a mortgage approval calculator?
Not quite. 'Affordability' and 'qualification' calculators both estimate the same lender ceiling — your maximum purchase price under Canada's GDS (39%), TDS (44%) and OSFI B-20 stress test rules. 'Approval' is the underwriting step that follows: a specific lender verifying your credit, income and the property itself against that ceiling. This calculator estimates the ceiling every federally regulated lender uses; it does not issue an approval.
How much mortgage can I qualify for in Canada?
Your qualifying amount is the lower of two limits, both applied at the OSFI stress-test rate (contract rate + 2%, or 5.25%, whichever is higher): GDS, capping housing costs at 39% of gross income, and TDS, capping housing plus all other debt at 44%. A third limit — Canada's legal minimum down payment (5% up to C$500,000, 10% to C$1.5M, 20% above) — can cap the purchase price below what your income alone would support. Enter your income, debts and down payment above to see which of the three binds for you.
Related Calculators
Canadian Mortgage Calculator
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CMHC Insurance Calculator
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Land Transfer Tax Calculator
Include LTT in your upfront budget
FHSA Calculator
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Down Payment Savings Calculator
Project when you will hit your target down payment
Want to try different numbers?
Back to the calculator ↑Mortgage Affordability Calculator Canada is built and maintained by the RealCostIQ editorial team. Cost ranges and rates are checked against published industry data and contractor quotes, and revised when the underlying figures move. Read our data methodology or more about who builds this. Every calculation runs in your browser — no account, and none of your inputs are stored.
Cost ranges and rates here are checked against contractor quotes and published industry data. If a number still looks off, email Support@RealCostIQ.com and we'll review and fix it.