Not to talk you into buying, and not to talk you out of it — owning has upsides no spreadsheet can hold. This is a five-minute walk through the money side, so the biggest purchase of your life isn’t a mystery. Start with a price.
$900,000 is roughly a typical Toronto-area house. Everything below uses standard assumptions — 20% down, 25-year mortgage at 5.24%, Toronto taxes — noted as we go, and all editable in the calculator.
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Before you get a key, three cheques leave your account: the down payment ($180,000 at 20%), Toronto + Ontario land transfer tax ($28,950), and closing costs — lawyer, inspection, title (about $5,000). One of these is still your money, just moved into the house. Two are gone.
Land transfer tax assumes a repeat buyer (no rebate). First-time buyers get up to $8,475 back.
You borrow $720,000 and pay it back monthly for 25 years. Every payment splits in two: interest (the bank’s, gone) and principal (yours, kept). The split isn’t fixed — early on it’s mostly interest, and it flips as the balance falls.
Canadian fixed mortgages compound semi-annually — this chart does too. Rates also renew every few years; the calculator lets you test that.
The mortgage is only the start. On top of it: property tax, maintenance, insurance, and utilities (renters pay those too — we count them on both sides). Line them up and the real monthly number appears — with the mortgage’s kept-vs-gone split shown inside it.
Blue = becomes equity. Red = spent. Maintenance surprises people: on this home, the 1%/yr rule of thumb is $750 every month, on average, forever.
Homes in Canada have historically appreciated over long periods. Nobody can promise the future — we’ll assume 3% per year and hold that lightly. At that rate, here’s the value at 5-year checkpoints.
Appreciation is the single most powerful — and least certain — number in the whole story. The calculator lets you set it to anything, including 0%.
Rent isn’t “thrown away” and a mortgage isn’t “paying yourself” — both camps oversimplify. The fair test: add up each path’s sunk costs. For renters that’s rent. For owners it’s interest, taxes, upkeep — but not principal, which you keep. Then remember the renter still holds the $213,950 day-one cash, invested. Run both lives forward and watch the gap.
Assumes rent for this home ≈ $3,300/mo (scaled to price), growing 2.5%/yr, with the same utilities paid in both lives. The winner flips with small changes to rates, rent, and appreciation — that’s the honest answer.
Rent out a basement suite — say 50% of the house at $2,200/mo — and two things happen: rent comes in, and the CRA lets you deduct the rented share of your interest and costs against it. Compare the monthly sunk cost of all three lives:
After 8% vacancy and tax at a 45% marginal rate. Being a landlord is real work with real risks — vacancies, repairs, tenants’ rights — and it changes your principal-residence tax exemption. The money, though, is significant.
Educational estimates, not financial advice.
Stability, roots, a wall you’re allowed to paint — those don’t fit in a chart, and they’re allowed to win. This tool exists so that whatever you choose, you choose it with open eyes.
Assumptions used above (every one editable in the calculator): 20% down · 25-year amortization · 5.24% fixed, semi-annual compounding · no first-time-buyer land-transfer rebate · $5,000 closing costs · property tax 0.77%/yr · maintenance 1%/yr · insurance 0.25%/yr · utilities $400/mo · appreciation 3%/yr · equivalent rent ≈ 0.37% of price/mo, growing 2.5%/yr · investments return 5%/yr · selling costs 5.8% · suite = 50% of home at ≈ 0.24% of price/mo, 8% vacancy, 45% marginal tax. Illustrative only — not financial, tax, or investment advice.