The bank tells you what you qualify for. This tells you what you can actually afford - after tithing, saving, and leaving margin to breathe.
Enter your actual situation to see your GDS and TDS ratios.
Your Income
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Housing Details
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30-year amortization is available on uninsured mortgages with 20%+ down; confirm product details with your lender.
Monthly Costs (used in GDS ratio)
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Typical range: $300–$700/mo. Check your municipality. ~0.6–1% of home value annually.
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Most lenders use $150–$200/month as a default estimate.
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50% of condo fees are included in the GDS calculation.
Other Monthly Debts
Added to housing costs for the TDS ratio. Leave at 0 if not applicable.
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Your Priorities
The bank ignores these. You shouldn't.
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Your Affordability Summary
GDS Ratio (max 39%)--
TDS Ratio (max 44%)--
TDS equals GDS when you have no other monthly debts.
Maximum Home Price at Each Threshold
Bank Maximum
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GDS 39% limit
Conservative
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GDS 28% target
Wise & Faithful
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After tithe & savings
If 10% goes to tithe and 10% to savings, only 80% of your income is available for expenses. Housing should stay around 30% of that 80% - which is roughly 24% of gross.
Monthly breakdown based on your Wise & Faithful maximum price (--). Adjust your income, down payment, or priorities to see how it changes.
Monthly Budget Breakdown
Gross Monthly Income--
Tithe / Giving--
Savings--
Remaining (after tithe & savings)--
Mortgage Payment--
Property Tax--
Heating--
Condo Fees (50% in GDS)--
Other Debt Payments--
Total Housing & Debt--
Left for Everything Else--
GDS and TDS Explained
Gross Debt Service (GDS)
Your monthly housing costs - mortgage payment, property tax, heating, and 50% of condo fees - divided by gross monthly income. Must be 39% or less to qualify.
Total Debt Service (TDS)
All monthly housing costs plus all other debt payments (car, student loans, credit cards, lines of credit) divided by gross monthly income. Must be 44% or less.
The honest problem with these ratios: The bank's maximum does not account for tithing, retirement savings, emergency funds, children, or any margin for life. A GDS of 39% is a cliff edge, not a goal. Aim well below it.
The Stress Test
To get a mortgage in Canada, you must qualify at a rate higher than what you'll actually pay. This is the mortgage stress test, required by OSFI since 2018.
Contract Rate
Stress Test Rate
Rule Applied
3.0%
5.25%
Floor rate
4.0%
6.0%
Rate + 2%
4.84%
6.84%
Rate + 2%
5.5%
7.5%
Rate + 2%
The stress test exists to ensure you can still afford your mortgage if rates rise. It reduces borrowing power by roughly 20% compared to qualifying at the contract rate.
Frequently Asked Questions
How much house can I afford in Canada?
The standard rules are: your housing costs (mortgage payment, property tax, heat, condo fees) should not exceed 32% of your gross monthly income (the GDS ratio), and your total debt payments including housing should not exceed 44% of gross monthly income (the TDS ratio). These are the CMHC qualifying thresholds.
What is the mortgage stress test in Canada?
The stress test requires that you qualify at the higher of your actual mortgage rate plus 2%, or 5.25%. This means if you are offered a 5% mortgage rate, you must qualify as though the rate were 7%. It is designed to ensure you can handle rate increases.
How much do I need for a down payment in Canada?
Minimum 5% on homes under $500,000. On homes between $500,000 and $999,999, the minimum is 5% on the first $500,000 and 10% on the amount above that. On homes at $1 million or more, the minimum is 20%. A down payment under 20% requires CMHC mortgage insurance.
What are closing costs in Canada?
Budget roughly 1.5-4% of the purchase price for closing costs, including land transfer tax (which varies by province), legal fees ($1,500-$3,000), title insurance, home inspection, and other administrative costs. Ontario and Toronto have provincial and municipal land transfer taxes that add significantly to the total.
Is buying a home always a good investment?
Not necessarily. Whether buying beats renting depends on local price-to-rent ratios, your time horizon, transaction costs, and your opportunity cost if that down payment were invested instead. Use the rent vs. buy calculator alongside this one for a more complete picture.