Methodology

Affordit estimates what your income could afford in Canada using Canadian housing guidelines and clearly stated assumptions. Here's how the rent, mortgage, borrowing and savings estimates are calculated. With a co-applicant, the two incomes are added together.

Rent

The monthly rent estimate is based on 30% of your gross income, a common Canadian benchmark for total shelter costs. When comparing rentals, include utilities paid separately within that budget. Statistics Canada: Housing affordability

Mortgage

The mortgage estimate shows the home price your income could support and the monthly payment that comes with it. The calculation includes property tax and heating, using the following guidelines and assumptions.

Gross Debt Service (GDS) limit: 39%; The share of gross income that housing costs may take. These costs include the mortgage payment, property tax, and heating.
Total Debt Service (TDS) limit: 44%; The share of gross income that housing costs plus all other debt payments may take.
Mortgage rate: 4.25%; The default rate Affordit uses for the monthly payment. Your rate may differ.
Qualifying rate: 6.25%; The rate lenders use to confirm you could still afford the payments if rates rise. The higher of 5.25% and the mortgage rate above plus 2%.
Amortization: 25 years; The typical period the mortgage is paid off over.
Minimum down payment: 5%; On the first $500,000, and 10% on the rest up to $1,500,000. From that price the minimum is 20%. A down payment below 20% adds mortgage loan insurance.
Mortgage insurance premium: 4%; Of the loan amount, with a 5% down payment. With a 10% down payment the insurance premium is 3.1%, and with 15% it is 2.8%. The premium is added to the loan. With a down payment of 20% or more, the loan is uninsured.
Property tax: 1%; An assumed rate of the purchase price each year. Rates vary by municipality.
Heating: $100/month; An assumed cost. Real costs vary by home.

The home price is the highest price that passes the debt service limits once the down payment, the insurance premium and the monthly cost at the qualifying rate are worked out. The monthly payment shown is principal and interest at the mortgage rate; property tax and heating are part of the qualifying test and sit on top of it. Payments use semi-annual compounding, the Canadian convention for a fixed-rate mortgage.

Sources: OSFI: Minimum qualifying rate CMHC: Mortgage loan insurance requirements

Borrowing

The borrowing estimate shows the car loan, the personal loan and the credit card balance your income could carry. All three use the same monthly room, so they are alternatives: you could choose one of them.

Housing cost: 30% of income; The rent budget. It stands in for your housing costs on the homepage.
Total Debt Service (TDS) limit: 44%; The share of gross income that all debt payments may take, housing included. What is left after housing is the room for a new loan or card balance.
Car loan rate: 6.55%; The Bank of Canada average rate on new auto loans at chartered banks, June 2026. Your rate depends on your credit history and the lender.
Personal loan rate: 7.8%; The Bank of Canada average rate on new personal loans at chartered banks, June 2026. Your rate depends on your credit history and the lender.
Loan term: 60 months; An assumed term for both loans. Personal loans typically run from 6 to 60 months.
Credit card payment: 3%; Of the balance each month. This is how CMHC counts a card balance in the TDS test.

The monthly room is the TDS limit on your gross income, less the rent budget. Each loan amount is the principal that this room pays off over the term at the rate above, compounded monthly. The credit card figure is the balance whose 3% monthly payment equals the room.

Sources: Bank of Canada: Interest rates on new lending CMHC: Calculating GDS / TDS FCAC: Personal loans

Savings

The monthly savings estimate is based on 10% of your gross income, a simple planning target. Your own target may be higher or lower, depending on your budget and priorities.

The time to save a down payment divides the minimum down payment on the estimated home price by the monthly target, and rounds up to a whole month. It counts deposits only, with no interest or investment return.