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Affordability Calculator

Find out how much home you can afford

How It Works

Canadian lenders use two key ratios to determine how much you can borrow:

  • GDS Ratio (39%): Housing costs should not exceed 39% of gross income
  • TDS Ratio (44%): Total debt payments should not exceed 44% of gross income
  • Stress Test: You must qualify at the higher of your contract rate + 2% or 5.25%
Mortgage CalculatorCMHC InsuranceLand Transfer Tax

Home Affordability — Frequently Asked Questions

How much home can I afford in Toronto on a $150,000 salary?

Using the standard GDS ratio of 39% and assuming a 20% down payment, a $150,000 gross household income qualifies for roughly $750,000–$850,000 with today's rates. However, existing debts, property taxes, and the mortgage stress test all reduce this figure. Use the calculator above for a precise estimate based on your actual numbers.

What is the GDS (Gross Debt Service) ratio in Canada?

GDS is the percentage of your gross monthly income that goes toward housing costs — mortgage payment (principal + interest), property taxes, heating, and 50% of condo fees. Canadian lenders typically require your GDS to be 39% or less. If your GDS exceeds this, you won't qualify for the mortgage regardless of your income.

What is the TDS (Total Debt Service) ratio in Canada?

TDS adds all your monthly debt payments (car loans, credit card minimums, student loans, etc.) on top of your housing costs, then divides by gross monthly income. Canadian lenders require TDS of 44% or less. High consumer debt is one of the most common reasons buyers in Toronto qualify for less home than they expect.

What is the Canadian mortgage stress test and how does it affect affordability?

The stress test requires that you qualify at the greater of your contract rate + 2%, or 5.25%. So if your lender offers 5.0%, you must qualify at 7.0%. This reduces your maximum purchase price by 15–20% compared to what the actual payment would cost. Our calculator applies the stress test automatically.

Does a larger down payment increase what I can afford?

Yes, in two ways. First, a larger down payment reduces the loan amount, which lowers monthly payments and improves your GDS/TDS ratios. Second, a down payment of 20% or more eliminates the CMHC insurance premium (up to 4% of the loan), saving thousands. Some buyers save to 20% specifically to access a larger purchase price.

How much income do I need to buy the average Toronto home?

The average resale home in Toronto sells for around $1,100,000–$1,200,000. To qualify for a mortgage on a $1.1M home with 20% down, you need a gross household income of approximately $170,000–$185,000, depending on your existing debts and the current interest rate. Condos and townhomes under $800,000 are more accessible, typically requiring $110,000–$130,000 in household income.

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