Property Soul has come up with a rather nice article that lets you determine whether you can afford a dwelling and whether you are paying right for it. He cites the 3-3-5 Rule which de-construct to:

1. Your initial capital should be 30% of your property price

This is rather prudent, in that you are paying down a good chunk of the dwelling to avoid being overleverage by a large mortgage. For a single, if you have 250k, this section you can afford a 250/0.30 > 833k dwelling. Sweet.

2. Monthly Mortgage Payment Less than 1/3 of your Salary

The total debt servicing ratio (TDSR) means that the total debt of a couple or single wanting to purchase a dwelling cannot be more than 60%. This rule goes even further, by stating that you should not use more than 30% of your gross salary (pre tax) to service your ......