How much home can you afford in the GTA? A step-by-step budget
Your budget is not what a lender will approve; it is what you can carry comfortably.
Step 1: Down payment
- 5% of the first $500,000
- 10% of the portion between $500,000 and $1.5 million
- 20% if the price is $1.5 million or more
Under 20% down, you pay mortgage default insurance, added to the loan.
Step 2: The stress test
Lenders check that you can pay at the higher of your contract rate plus 2% or the minimum qualifying rate. Your housing costs and other debts must fit within their ratios.
Step 3: Monthly costs
- Mortgage payment
- Property tax
- Condo or POTL fees
- Utilities and insurance
- Maintenance (about 1% of the home's value a year for freehold is a common rule of thumb)
Step 4: Closing costs
Land transfer tax (twice in Toronto), legal fees, title insurance, adjustments and moving. For new homes, add the builder's adjustments.
Step 5: Leave a cushion
Keep an emergency fund after closing.
Try the mortgage calculator, then book a call to match your budget to real listings and projects.
What does this mean for you?
Book a free 15-minute call and Dinesh will walk you through how it affects your plans.
