Buy it to rent it — does the rent carry the mortgage?
Rate 2026-06 · tax rate 2026 · rents from the 2025 official averages and our own listings
House prices in Thunder Bay are low by Ontario standards, but property tax at 1.92% is heavy (Toronto is around 0.7%) — on a $350,000 house that is $561 a month in tax alone. So the answer depends on how you let it: whole-unit letting usually doesn't cover the costs; by-the-room letting is where the cash flow turns positive. Put in the price of the house you are actually looking at — every other default has a source.
Carrying costs (property tax is official; the other three are rules of thumb)
Monthly surplus
+$210
You put down $70,000 and borrow $280,000. Rent covers the mortgage and the carrying costs — before income tax, and before anything the property itself does in value.
Canadian mortgages compound semi-annually, not monthly, and that is the convention used here. The figures exclude income tax, legal fees, land transfer tax and any change in the property's value, and are not investment advice. Renting rooms to several unrelated tenants can trigger lodging-house licensing and fire requirements — ask the city before you let.
Questions
If I buy in Thunder Bay to rent out, will the rent cover the mortgage?
Letting the whole unit usually won't; letting by the room can. On a $350,000 house with 20% down, a 5.13% rate and a 25-year amortization: let whole at CMHC's average 2 bedroom rent of $1,537, you are short $927 a month; split the same house into 4 rooms at $700 each and you clear $210 a month. The gap is property tax — it is charged on the value of the house, regardless of how you let it.
What is the minimum down payment on a rental property?
20%. A home you live in can be bought with less by taking CMHC insurance, but that insurance does not cover non-owner-occupied rentals, so lenders generally require at least 20%. The calculator above starts there.
How much is property tax in Thunder Bay?
The 2026 residential (full service) rate is 1.9231%, municipal plus education, from the city's published rate table. That is high for Ontario — Toronto is around 0.7%. On a $350,000 house the tax alone is $561 a month, close to a third of the $1,649 mortgage payment.
How is mortgage interest calculated in Canada?
Semi-annually, not monthly — it is set out in the Interest Act. So the monthly rate is (1 + annual rate / 2)^(1/6) − 1, not the annual rate divided by 12. Applying the American formula overstates the payment, and over 25 years the difference is not small. This calculator uses the Canadian convention.
Where do the calculator's defaults come from?
The rate comes from Statistics Canada table 34100145 (CMHC's posted 5-year conventional mortgage lending rate, 2026-06); the property tax rate from the City of Thunder Bay's rate table; the whole-unit rent from CMHC's 2025 average for a 2 bedroom; and the $700 per room from the median of the 86 listings on this site over the last 90 days priced below CMHC's cheapest unit type. There is no default purchase price — we have no Thunder Bay sale-price data, so that field is for the house you are actually looking at.
Related
The figures exclude income tax, legal fees and land transfer tax, and take no view on where prices go — this is not investment advice. Insurance, maintenance and vacancy reserves are industry rules of thumb rather than measured local data; every field can be changed. Renting rooms to several unrelated tenants can trigger lodging-house licensing and fire requirements — ask the city before you let.
Published 2026-08-06 · data updated 2026-08-04 · lakebbs editorial