Housing Costs

Understand housing costs in Canadian real estate, what’s included, how they affect mortgage approval, and why they matter for budgeting.

Housing Costs

May 22, 2025


What are Housing Costs?

Housing costs refer to the monthly expenses directly related to owning or renting a home, including payments, taxes, utilities, and maintenance.

Why Do Housing Costs Matter in Real Estate?

In Canadian real estate, housing costs are a critical part of affordability calculations. Lenders use these figures to determine mortgage eligibility through the Gross Debt Service (GDS) ratio.

Housing costs typically include:
  • Mortgage principal and interest payments
  • Property taxes
  • Heating expenses
  • 50% of monthly condo fees (if applicable)
Buyers must understand these ongoing expenses to accurately budget for homeownership. In addition to the direct costs included in GDS, homeowners also face insurance, repairs, and occasional major upkeep.
Understanding housing costs is essential for evaluating financial readiness, comparing properties, and passing lender affordability tests.

Example of Housing Costs in Action

A condo buyer’s housing costs include $1,600 in mortgage payments, $200 in taxes, $100 in heating, and $150 in condo fees — totaling $2,075 per month.

Key Takeaways

  • Recurring monthly expenses tied to housing.
  • Used in mortgage affordability calculations.
  • Includes mortgage, taxes, heat, and condo fees.
  • Helps define budget and lender limits.
  • Must be accurately estimated before buying.

Related Terms

Additional Terms

Public Realm Improvements

Public realm improvements are enhancements to public spaces such as sidewalks, parks, plazas, and streetscapes, often funded or contributed by. more

Mortgagee in Possession

A mortgagee in possession is a lender who takes control of a property after borrower default, but before foreclosure or power of sale. The lender. more

Lease Surrender Agreement

A lease surrender agreement is a negotiated contract between a landlord and tenant that ends a lease before its scheduled expiration. Terms may. more

Green Infrastructure

Green infrastructure refers to natural or engineered systems that manage stormwater, reduce heat, and improve sustainability in developments.. more

Escrow Holdback

An escrow holdback is a portion of funds withheld at closing and held in escrow until specific conditions are met, such as completion of repairs,. more

Underused Housing Tax

The Underused Housing Tax (UHT) is a federal annual 1% tax on the value of vacant or underused residential property owned by non-resident,. more

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