How Much Mortgage Can You Afford on a $70K Salary in Canada? [2025 Guide]
Earning $70,000 a year in Canada? You’re probably wondering how much house you can actually afford — and whether the dream of homeownership is within reach.
Good news: for most Canadians in 2025, a $70K salary can qualify you for a mortgage somewhere between $280,000 and $380,000. But that’s just a ballpark. The exact number depends on your debt, down payment, credit, and even where in the country you’re planning to buy.
In this guide, we’ll break down:
- How lenders decide how much you can borrow
- What the mortgage stress test means for you
- Real examples from across Canada
- Tips to boost your buying power
- A calculator to help you estimate your max budget
Let’s dive in — and help you take the guesswork out of buying a home.
1. How Lenders Decide What You Can Afford (GDS, TDS & the Stress Test)
Banks and lenders don’t just look at your income — they run your numbers through two main ratios to make sure you can afford the payments long-term:
- GDS (Gross Debt Service): Your monthly housing costs shouldn’t be more than 39% of your gross income.
- TDS (Total Debt Service): All debt payments — mortgage, car loan, credit cards, etc. — must stay under 44% of your gross income.
And yes, there’s a catch: every borrower has to pass the mortgage stress test. That means qualifying at the higher of:
- Your actual mortgage rate, or
- The Bank of Canada benchmark rate + 2%
Quick Example: GDS on a $70K Salary
Let’s run the numbers:
- Monthly income: $70,000 ÷ 12 = $5,833
- Max housing costs (GDS @ 39%): $5,833 × 0.39 = $2,275/month
- Housing costs include: Mortgage payment + property taxes + heating + half of condo fees (if any)
To stay within budget, your total housing costs need to come in under $2,275/month.
Need help with the math? Call us — we’ll run the numbers and explain what they mean for you.
2. What Impacts How Much You Can Borrow?
1. Your Down Payment
- Minimum down payment: 5% for homes under $500,000
- 20% or more: Skip CMHC mortgage insurance (and save thousands)
| Home Price Down Payment CMHC Insurance? | ||
| $350,000 | $17,500 (5%) | ✅Yes |
| $350,000 | $70,000 (20%) | ❌No |
2. Interest Rates in 2025
Rates vary by lender and your credit score, but here’s what’s typical:
- 5-Year Fixed Rate: ~5.30%
- Stress Test Rate: ~7.30% (Q1 2025)
3. Your Credit Score
- 680+ → Best rates and more lender options
- 600–679 → Decent, but fewer choices
- Below 600 → Likely higher rates or declined applications
4. Existing Debt
Even moderate monthly payments can lower what you qualify for. Common examples:
- $400/month car loan
- $250/month student loan
- $100/month credit card minimums
5. Local Housing Costs
Don’t forget ongoing costs like:
- Property tax: ~$2,000–$4,000/year
- Heating: ~$150/month
- Home insurance: ~$75/month
3. Real Scenarios: What Can You Afford on $70K?
Let’s look at what different setups might get you on a $70,000 salary:
| Scenario | Down Payment | Rate | Max Home Price | Monthly Payment |
| A: 5% Down | $14,500 | 3.9% | ~$325,000 | ~$1,508 |
| B: 10% Down | $35,000 | 3.9% | ~$350,000 | ~$1,526 |
| C: 20% Down | $90,000 | 4.1% | ~$450,000 | ~$1,720 |
All scenarios assume a 30-year amortization, 1% of purchase price for property taxes, 100 heat, and stress test qualification. Property taxes are often less than 1%, but this creates a healthy buffer. With 20% down, some lenders will allow elevated ratios- we’ve built this into the calculation above.
4. Want an Instant Estimate?
Use our interactive Mortgage Calculator to see what you could afford based on your salary, debt, down payment, and location. For the most accurate results, contact an expert at Red Key Mortgage!
How it works:
- Enter your income
- Pick your down payment
- Select or enter a mortgage rate
- View your estimated home price range + monthly payment
Simple, fast, and tailored to you.
5. 5 Ways to Maximize Your Buying Power
Here’s how to stretch your budget and unlock better mortgage options:
1. Save a Bigger Down Payment
o Tap into RRSPs using the Home Buyers’ Plan (up to $60K in 2025)
o Check for provincial first-time buyer incentives
2. Raise Your Credit Score
o Always pay on time, and aim to keep credit usage under 30%
o Fix errors on your credit report (they’re more common than you think)
3. Pay Off High-Interest Debt
o Focus on credit cards, car loans, or lines of credit
4. Consider a Co-signer or Joint Mortgage
o Tap into RRSPs using the Home Buyers’ Plan (up to $60K in 2025)
o Check for provincial first-time buyer incentives
5. Shop Around
o Don’t settle for the first offer. Compare rates from banks (RBC, TD, BMO) and mortgage brokers like Red Key Mortgage.
6. What’s Unique About Buying in Canada?
A few Canada-specific quirks to keep in mind:
- Alberta has no land transfer tax (unlike Ontario and B.C., where it can add thousands)
- Typical home prices (2025):
o Toronto: ~$1,020,000
o Vancouver: ~$1,160,000
o Calgary: ~$580,000
o Halifax: ~$500,000
o Winnipeg: ~$380,000 - Federal incentives to explore:
o First-Time Home Buyer Incentive
o Canada Greener Homes Grant
7. FAQs — Quick Answers for Homebuyers
Q: What mortgage can I get with a $70K salary in Canada?
A: With decent credit and low debt, somewhere between $280K–$380K depending on your down payment and rate
Q: What’s the mortgage stress test?
A: It forces you to qualify at a rate 2% higher than your actual rate — to ensure you can handle future rate hikes.
Q: Do I need mortgage insurance (CMHC)?
A: Only if your down payment is under 20%. It protects the lender, not you — and the premiums get added to your mortgage.
Q: Can I use my RRSP for a down payment?
A: Yes, up to $60,000 as of 2025 through the Home Buyers’ Plan.
Q: What are closing costs?
A: Budget $3,000–$7,000 for legal fees, inspections, appraisals, and land title costs (varies by province).
With a $70,000 salary, homeownership in Canada is possible — especially if you play your cards right. Maximize your down payment, improve your credit, and keep your debt in check, and you could qualify for a home worth $325,000 or more.
Want to know your exact numbers?
👉🏻Try our Mortgage Calculator.
📞Or book a free call with a Red Key Mortgage Advisor — we’ll walk you through every step.
Because buying a home should feel exciting, not overwhelming.