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Affordability Calculator

BC Mortgage Affordability Calculator

Last reviewed by Bronson Job, REALTOR®Sources: OSFI, CMHC, BC.gov.caCC BY 4.0How we verify

Most BC buyers fixate on the contract rate when shopping mortgages — but the OSFI stress test (which qualifies you at the GREATER of contract + 2 percentage points or 5.25%) is the binding constraint on what you can actually buy. The number you get pre-approved for is set by the qualifying rate, not the contract rate.

Pre-approval is set by the qualifying rate, not the contract rate. The two numbers diverge by hundreds of thousands of dollars at the high end.
— OSFI Guideline B-20, §6.1.4

Calculate

Amortization period

30-year amortization is restricted to FTHB or newly-built insured mortgages (effective Dec 15, 2024).

Maximum purchase price
$744,624
Maximum mortgage you qualify for
$594,624
Binding constraint
GDS (GDS 39.0% / TDS 43.0%)
Qualifying rate (OSFI stress test)
7.50%
Monthly P+I at qualifying rate (your pre-approval test)
$4,350
Monthly P+I at contract rate (what you’d actually pay)
$3,630
Closing-cost estimate (PTT − FTHB exemption + legal + adjustments)
$7,792
Down payment as % of max price
20.1%

Below the FTHB phase-out band ($860,000) — you may qualify for the BC First Time Home Buyer PTT exemption. See /codex#bc.ptt.fthb_exemption.

Estimate only. Final pre-approval is set by your lender against your credit report, employment letter, downpayment-source documentation, and the appraisal of the actual property. The math here mirrors the CMHC convention; some lenders apply slightly different GDS/TDS limits or other-debt-payment treatments.

Reproduce this number8 steps
StepAmount
Qualifying rate = max(5.5% + 2.0pp, 5.25%) = 7.50% (osfi.b20.stress_test)$7.50
Monthly gross income (annual / 12)$12,500.00
Other housing (prop tax/12 + heating + 50% strata)$525.00
Max P+I under GDS ≤ 39% (39.0% × monthly income − other housing)$4,350.00
Max P+I under TDS ≤ 44% (44.0% × monthly income − other housing − monthly debts)$4,475.00
Binding constraint: GDS; max P+I = min(GDS, TDS)$4,350.00
Max mortgage principal at qualifying rate (7.50%, 25-year amortization)$594,623.85
Max purchase price = max mortgage + down payment$744,623.85
Total$744,623.85

Computed from the BC Real Estate Codex · CC BY 4.0

The contract rate vs. qualifying rate gap

At a 5.5% contract rate, the OSFI qualifying rate is 7.5% (contract + 2pp). On a $800,000 mortgage over 25 years, monthly P+I at contract is roughly $4,890; at qualifying it’s closer to $5,860 — a $970/month gap that the lender uses to confirm you can absorb a renewal-day rate shock. Your pre-approval is sized so that the qualifying-rate payment fits inside GDS ≤ 39% / TDS ≤ 44%, not the contract-rate payment.

That’s why so many BC buyers find the pre-approval letter is materially smaller than they expected. The contract-rate version of the math would say they qualify for $1.1M; the qualifying-rate version says $920K. The qualifying-rate version is what the bank is actually willing to lend.

Related

Verified sources (1)Click to expand

Every claim on this page is sourced to a primary government, regulator, or industry-association URL. We re-verify quarterly; the verification dates below show when each source was last confirmed against the live government page.

Fact ID: osfi.b20.stress_test · v1View in Codex →
Spot an issue? Report an inaccuracy · How we verify
Verified sources (2)Click to expand

Every claim on this page is sourced to a primary government, regulator, or industry-association URL. We re-verify quarterly; the verification dates below show when each source was last confirmed against the live government page.

Fact ID: cmhc.insurance_cap · v2View in Codex →
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Verified sources (2)Click to expand

Every claim on this page is sourced to a primary government, regulator, or industry-association URL. We re-verify quarterly; the verification dates below show when each source was last confirmed against the live government page.

Fact ID: bc.ptt.brackets · v1View in Codex →
Spot an issue? Report an inaccuracy · How we verify
Verified sources (1)Click to expand

Every claim on this page is sourced to a primary government, regulator, or industry-association URL. We re-verify quarterly; the verification dates below show when each source was last confirmed against the live government page.

Fact ID: bc.ptt.fthb_exemption · v2View in Codex →
Spot an issue? Report an inaccuracy · How we verify