201-1500 Bank Street

Ottawa, ON K1H 7Z2

Tips on Financing

How Much House Can You Afford?

Please use these calculations as a guide. A Mortgage Specialist (there are several listed on my Service Providers page) will be your best resource to truly figure out how much house you can afford.

Gross Debt Service Ratio:

Your Gross Monthly Salary* $________________ + Your Spouse’s Gross Monthly Salary* $______________ + other monthly income $_________________ =Total Monthly Gross Income $____________________.

Total Monthly Gross Income X 32% = Maximum monthly housing costs you can afford. This maximum monthly payment includes principal, interest, taxes, heating (P.I.T.H.), and land lease if applicable and 50% of condominium fees if applicable.

*Gross salary is salary before taxes.

Total Debt Service Ratio:

Total Monthly Gross Income (as calculated above) X 40% = Maximum monthly debt service load you can afford.

Subtract from this your monthly car payment, any monthly loan payments, monthly credit card payments, and any other monthly payments the remainder is monthly income for housing.

Some things to consider: If the home you dream of costs more per month than you can afford right now consider the following:

  • lower your expectations-smaller less expensive house
  • try to pay off some of your non housing debt
  • save for a larger down payment.

I can help you put a plan in place so that you can make your dream of home ownership a reality!


Susan Oneid

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