Toronto Condo Fees: How They Lower What You Can Borrow

Condo fees lower how much mortgage you can get because lenders count part of that monthly fee as a housing cost, and every dollar they count leaves less room for the mortgage itself. Two condos at the same price can therefore qualify you for different loan sizes.

That surprises many Toronto buyers, because the fee is never part of the mortgage payment. This guide shows exactly how the counting works, walks through a clearly labelled made-up example, and lists what to check before you fall for a unit.

Quick answer: Yes, condo fees affect the mortgage you qualify for. Lenders add a share of your monthly condo fee to your housing costs when they test your income, and for mortgages insured by CMHC that share is 50%. A higher fee means less room for the mortgage payment, so your maximum loan can shrink even though the fee goes to the building and not to the lender. A licensed mortgage broker can show you how the fee on a specific unit changes your numbers.

Below, you'll find how lenders count the fee, a worked example, why fees differ so much between buildings, and five steps to check a condo before you make an offer.

Key Takeaways

• A condo fee is a monthly charge paid to the condo corporation, and lenders count part of it as a housing cost when they work out how much you can borrow.
• For mortgages insured by CMHC, 50% of the condominium fee must be included in both debt service ratios, and CMHC limits those ratios to 39% and 44%.
• In the made-up example below, a $400 difference in monthly fees shrinks the maximum mortgage by roughly $33,000, even though the fee is not part of the mortgage payment.
• A low fee is not always good news: it can mean the building is not saving enough for future repairs, which can lead to higher fees or a special assessment later.
• In Ontario, a resale condo's status certificate shows its budget, reserve fund, and special assessments, so ask to review it before you finalize an offer.
• Ask your broker to run your numbers with the actual fee for each unit you are considering, before you start touring, not after you have chosen one.

How Condo Fees Reduce the Mortgage You Qualify For

Lenders limit how much of your income can go to housing, and the condo fee takes up part of that limit. Whatever the fee uses up is no longer available for your mortgage payment.

Definition moment: GDS (gross debt service, the share of your income that goes to housing costs) includes your mortgage payment, property tax, heating, and, for a condo, part of the condo fee. TDS (total debt service) adds your other debts, such as car loans and credit cards.

For mortgages insured by CMHC, 50% of the condominium fee is included in both ratios, and CMHC restricts them to 39% for GDS and 44% for TDS. Lenders set their own approach for mortgages that are not insured, and some count the fee differently, so ask yours.

Bottom line: Part of every condo fee comes off the room you have for a mortgage, so the fee is part of your borrowing power, not a separate cost.

Our guide to the income needed for a mortgage in Toronto shows how these ratios work for the rest of your costs.

A Worked Example With Made-Up Numbers

Example only: these are round, made-up numbers to show the method. They are not real prices, rates, or fees, and your own results will be different.

Picture two condos with the same price and the same property tax. Condo A has a $400 monthly fee and Condo B has an $800 monthly fee, and the lender counts 50% of the fee.

The $6 figure is invented to keep the maths simple. The real figure depends on the test payment your lender uses, and that can change over time.

In this made-up case, the higher fee on Condo B could cost you about $33,000 of borrowing power, even though both units cost the same to buy. You would also pay the full $800 every month, because counting half is only how lenders test your application.

Bottom line: Half the fee, divided by the monthly cost per $1,000, gives a rough idea of how much borrowing power a fee takes away. You can try different prices and down payments in our purchase calculator.

Why Two Condos Have Such Different Fees

A condo fee is each owner's monthly share of running and repairing the building, so it rises with the services offered and the age of the building. What it covers varies from one building to the next.

• Shared costs. Building insurance, cleaning, and upkeep of hallways, elevators, and grounds.
• Utilities. Heat or water are included in some buildings and billed separately in others.
• Amenities and staff. A gym, pool, or concierge is paid for through the fee.
• Management. The company or team that runs the building day to day.
• Savings for big repairs. A portion of every fee goes into the reserve fund.

Definition moment: A reserve fund (a savings account the condo corporation builds up to pay for large repairs such as roofs, elevators, and windows) is funded by part of every owner's fee.

A low fee is not automatically a good sign. The Condominium Authority of Ontario notes that an underfunded reserve fund can hurt resale value, and that owners pay into the fund through their fees.

If the fund falls short, the building may raise fees later or charge owners a special assessment (a one-time extra charge to owners to cover a shortfall).

Bottom line: Judge a fee together with the building's savings, not on its own.

What Ontario homeowners often miss: Heat can sit inside the fee in one building and on a separate bill in the next. Compare total monthly costs between units, not just the fee line.

How to Check a Condo's Fee Before You Make an Offer

Definition moment: A status certificate (a document from the condo corporation that shows its budget, reserve fund, recent special assessments, and what you would owe as the owner) is the main way to look inside a resale condo's finances.

Here are five steps, in order, that take you from a listing to a confident offer.

1. Get the actual monthly fee and what it covers. Ask for the current fee, and check whether heat, water, parking, and storage are included.
2. Have your broker run your numbers with that exact fee. The fee changes your borrowing power, so test it before you tour.
3. Review the status certificate. Many Ontario buyers make their offer conditional on a satisfactory review of it with their real estate lawyer.
4. Look at the reserve fund details. The certificate shows when the latest reserve fund study was done and whether the board expects the fund to be enough for major repairs.
5. Compare total monthly cost, not just the fee. Add the mortgage payment, property tax, the fee, and any utilities the fee does not cover.

The Condominium Authority of Ontario explains what a status certificate must show.

What Toronto and GTA Condo Buyers Should Know

Condo fees across the Toronto area vary widely because buildings differ in age, size, and amenities. Compare fees between similar buildings rather than across very different ones.

A tower in North York or near Scarborough Town Centre with a pool, gym, and concierge may build those services into its fee, while a smaller building in Pickering, Ajax, or Richmond Hill may have fewer services to pay for. Buyers in Ottawa face the same logic with different buildings.

A condo purchase also brings its own closing costs, such as the lawyer's review of the status certificate. Our guides to closing costs in Ontario and the Ontario land transfer tax show what to budget for.

Bottom line: In the GTA, the same price can come with very different monthly costs, so compare fee, building, and borrowing power together.

5 Mistakes to Avoid When Buying a Condo

These mistakes are common, and each one can be avoided with a little planning.

1. Looking only at the price. Two condos at the same price can qualify you for different loan sizes. Compare the fee too.
2. Budgeting only half the fee. Lenders may count half to test your application, but you pay the full fee every month.
3. Choosing the lowest fee. A low fee can mean thin savings for repairs and higher costs later.
4. Skipping the status certificate. It is the clearest look at the building's finances, and skipping it means guessing.
5. Stopping at the pre-approval. A pre-approval uses estimates, so confirm it again with the real fee once you pick a unit.

Useful Resources for Ontario Condo Buyers

If you are just starting out, our first-time home buyer guide for Toronto covers the full process. To see how pre-approval works, read pre-approval versus pre-qualification.

Ready to check a unit? Visit our mortgage pre-approval page or talk to a licensed Ontario mortgage broker.

Frequently Asked Questions: Condo Fees and Your Mortgage

Do condo fees affect how much mortgage I qualify for?

Yes. Lenders add part of your monthly condo fee to your housing costs when they test your income, so a higher fee leaves less room for the mortgage payment. For mortgages insured by CMHC, 50% of the fee is counted, and CMHC limits housing costs to 39% of income and total debts to 44%. Lenders with uninsured mortgages set their own approach, so ask your broker how your lender treats the fee on the unit you want.

How much of the condo fee do lenders count?

It depends on the lender and the type of mortgage. CMHC requires 50% of the condominium fee to be counted in both debt service ratios for insured mortgages. Some lenders count a different share, and some treat heating separately when it is already in the fee. Because the share can change your maximum mortgage, ask for the method in writing and have your numbers re-checked once you choose a unit.

Is a lower condo fee always better?

Not always. A lower fee leaves more room in your borrowing power, but it can also mean the building is not saving enough for future repairs. The Condominium Authority of Ontario notes that an underfunded reserve fund can affect resale value. If savings fall short, owners may face higher fees or a special assessment later, so read the reserve fund details before you decide.

What is a status certificate, and do I need one in Ontario?

A status certificate is a document from the condo corporation that shows its budget, reserve fund, any special assessments, and what the unit's owner owes. The Condominium Authority of Ontario calls it especially important for buyers of resale condos. Many buyers make their offer conditional on a satisfactory review with their real estate lawyer, so request it early in the process.

What should I do if the condo fee goes up after I buy?

Read the notice from the condo corporation to see the reason for the increase, and check whether the status certificate you reviewed mentioned it. Update your monthly budget right away so the new amount is covered. If the higher fee makes payments hard, speak with a licensed mortgage professional early about your options, since acting sooner usually leaves you with more choices.

Should I use a mortgage broker when buying a condo?

A broker can run your numbers with the actual fee for each unit, compare how different lenders treat condo fees, and flag issues before you make an offer. lendsimpl is a licensed mortgage brokerage in Ontario (FSRA #13763), and its licensed professionals can review the unit's fee and your income together so you know your real borrowing power before you commit.

Disclaimer

This article is for general educational purposes only and should not be taken as financial, legal, or mortgage advice. Mortgage options, rates, approvals, and lender requirements can vary based on borrower profile, property details, credit history, income, equity, documentation, and current market conditions. Speak with a licensed mortgage professional before making a mortgage decision. lendsimpl is a licensed mortgage brokerage in Ontario (FSRA #13763).