Calculators
Student Rental & Duplex Cash-Flow Calculator
Test a Brock or Niagara College student rental, a duplex or a house with a legal suite: monthly cash flow, net operating income, debt coverage ratio, and how an A-lender would count the rent against your income.
Reviewed November 13, 2026 · Indicative figures, OAC
What this calculator shows
A rental can look profitable on gross rent and still fail a lender's test, or pass the lender and lose money every month. This calculator runs both views. It shows the cash flow you would actually see after vacancy, operating costs and the mortgage, and it shows the two ways lenders size a rental: the A-lender method that adds part of the rent to your personal income, and the debt coverage ratio (DCR) used by many credit unions and alternative lenders.
- Minimum down payment on a rental
- 20%
- A-lender rental add-back
- typically 50% of rent
- Typical minimum DCR
- 1.10–1.20
- Student-rental vacancy allowance
- 4%–8%
The inputs
- Municipality. Sets the approximate property tax rate (Thorold about 1.30%, St. Catharines about 1.26%, Welland about 1.32%).
- Price and down payment. A rental you will not live in needs at least 20% down.
- Units and rent. For a student house, the number of legal bedrooms and the rent per room; for a duplex, the number of units and the rent per unit.
- Rate. Rentals price in the uninsured tier; the indicative 5-year fixed is 4.54% this week.
- Operating costs. Vacancy, landlord insurance, utilities you pay, maintenance and municipal rental licensing. These are your assumptions; replace them with real quotes.
How the numbers are calculated
- Gross annual rent = units × monthly rent × 12.
- Effective income = gross rent × (1 − vacancy rate).
- Operating expenses = property tax (price × town rate) + insurance + utilities + maintenance + licensing. Mortgage payments are not an operating expense.
- Net operating income (NOI) = effective income − operating expenses.
- Annual debt service = monthly mortgage payment × 12, with the payment from P × i ÷ (1 − (1 + i)−n) and i = (1 + r/2)1/6 − 1.
- DCR = NOI ÷ annual debt service. Lenders using DCR typically want 1.10 to 1.20 or more.
- Cash flow = NOI − annual debt service.
- A-lender add-back: qualifying income = your income + 50% of gross rent, and the full rental payment, tax and heat count in your debt ratios at the qualifying rate.
- A-lender offset (variant): 50% of monthly rent − the rental's payment and tax at the qualifying rate; a shortfall is added to your debts, a surplus is ignored or partly counted, depending on the lender.
Worked example: five-bedroom student house in Thorold
Price $560,000 with 20% down ($112,000), mortgage $448,000 at 4.54% over 25 years, five legal bedrooms. Rent of $850 a room, insurance, utilities and licensing below are illustration figures, not quotes: check current rents, get an insurance quote and confirm licensing fees with the City of Thorold.
| Line | Calculation | Annual |
|---|---|---|
| Gross rent | 5 × $850 × 12 | $51,000 |
| Vacancy at 6% | $51,000 × 6% | −$3,060 |
| Property tax | $560,000 × 1.30% | −$7,280 |
| Landlord insurance (assumed) | placeholder | −$2,400 |
| Utilities paid by landlord (assumed) | placeholder | −$4,200 |
| Maintenance | 5% of gross rent | −$2,550 |
| Rental licensing (assumed) | placeholder | −$300 |
| Net operating income | $31,210 | |
| Debt service | $2,489.53 × 12 | $29,874.37 |
| Cash flow | NOI − debt service | $1,335.63 |
| DCR | $31,210 ÷ $29,874.37 | 1.04 |
The house carries itself by about $111 a month, but a DCR of 1.04 is below the typical 1.10 minimum. At a DCR of 1.10 the largest mortgage the NOI supports is about $425,481, which needs about $134,519 down (24.0%). At 1.20 it is about $390,024, or about $169,976 down (30.4%). Vacancy at 4% lifts the DCR to 1.08; at 8% it drops to 1.01.
The same house through an A-lender
Suppose the investor earns $140,000 and already pays $2,200 a month for their own home's payment, tax and heat, with no other debts. The rental is tested at the 6.54% qualifying rate (4.54% + 2.00%), giving a payment of $3,011.68, plus $606.67 a month of tax: $3,618.35.
| Method | Calculation | TDS |
|---|---|---|
| 50% add-back | ($3,618.35 + $2,200) ÷ (($140,000 + $25,500) ÷ 12) | 42.19% |
| 50% offset | $2,125 − $3,618.35 = −$1,493.35 shortfall; ($2,200 + $1,493.35) ÷ $11,666.67 | 31.66% |
Both pass a 44% limit here, with the offset method leaving far more room. A borrower earning $95,000 would fail the add-back test on the same property (57.94%), which is when DCR-based lenders become relevant.
Duplexes and secondary suites
Set units to 2 or 3 and enter rent per unit. Ontario allows up to three residential units on most serviced urban lots as of right, subject to local zoning and the Building and Fire Codes. If you live in one unit, the purchase can be owner-occupied, which opens default insurance with less than 20% down and lets lenders count rent from the other units. There is also an insured refinance to add a secondary suite: up to 90% of the as-improved value, property value up to $2 million, up to four units. See duplex and secondary suite mortgages.
Limitations
- Insurance for student rentals and multi-tenant homes varies widely; get a quote before you rely on the result.
- Capital items such as a roof, furnace or windows are not included in a 5% maintenance allowance.
- Five or more units are financed as commercial; see multi-family mortgages.
- Lenders set their own add-back, offset and DCR rules; the calculator shows common versions.
For the full underwriting picture, read student rental mortgages in Thorold and Welland and A-lender vs B-lender vs private, then send us your numbers through the form below.
Frequently asked questions
What is a debt coverage ratio?
DCR is net operating income divided by annual mortgage payments. A DCR of 1.20 means the property earns 20% more than its debt service after operating costs. Lenders using DCR typically want a minimum of 1.10 to 1.20.
How do A-lenders count rental income?
Most use either an add-back, where 50% of gross rent is added to your income and the full rental costs count in your ratios, or an offset, where 50% of rent is netted against the rental's costs and only a shortfall counts as debt. The offset method is usually more forgiving.
What vacancy should I assume for a student rental?
A 4% to 8% allowance is a sensible range for student rentals near Brock University and Niagara College, because leases often follow the academic year and summer months can be hard to fill. On $51,000 of gross rent, 6% is $3,060 a year.
How much do I need down on a Niagara student rental?
At least 20% for a non-owner-occupied rental. If the property's DCR is weak, a lender may effectively require more: in our Thorold example, reaching a DCR of 1.10 needs about 24% down.
Do I need a rental licence in Thorold or St. Catharines?
Several Niagara municipalities license residential rentals and set zoning rules on bedrooms and units. Requirements and fees change, so check the current municipal rental licensing by-law with the city before you buy, and budget for inspections and the licence fee.
Pre-approval & rate review
Get your Niagara mortgage numbers checked
Tell us where you are buying or what you owe. We reply by email, usually within one business day, with options from across the lender tiers.
- A licensed advisor reviews your numbers against A-lenders, Ontario credit unions and alternative lenders.
- Rate holds of up to 120 days on purchases and renewals (lender-dependent).
- On prime files the lender pays the brokerage, so there is no fee to you; any fee on alternative or private files is disclosed in writing first.
- Nothing goes to a lender or credit bureau until you say so.
Prefer email? Write to hello@mortgageniagara.com.