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The Ontario Real Estate Math Cheat Sheet

Every formula on the Humber exam, on a single printable page. Cap rate, mortgage qualification, commission, prorations, GIM, LTV. Free PDF.

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→12 formulas you'll need on exam day, with worked examples
→TDS / GDS qualification ratios at the lender's typical caps
→Commission math (listing, selling, co-op splits) the way the exam phrases it
→Prepared by an exam-prep coach, not a textbook publisher

Why math is the #1 reason candidates fail the Humber exam

About 30% of the Humber Real Estate Salesperson final exam tests numerical and financial reasoning — cap rate problems, mortgage qualification ratios, commission splits, prorations on closing, HST on new construction. Candidates who fail almost always fail on the math, not on the legal theory. The textbook covers most of these formulas spread across 1,200+ pages, which is why a single-page reference is the most efficient way to internalize them.

This cheat sheet collects the 12 formulas you'll actually be asked to apply on exam day, written the way the exam phrases them — not the way an academic textbook does. Each comes with a worked example so you see how the question becomes an answer.

The 12 formulas on the cheat sheet

Capitalization rate (Cap rate)

Cap Rate = NOI ÷ Property Value

Use: Investment property valuation. Rearrange to: Value = NOI ÷ Cap Rate.

Example: A property generates $48,000 NOI annually. Investors require an 8% cap rate. Maximum price = $48,000 ÷ 0.08 = $600,000.

Gross Income Multiplier (GIM)

GIM = Sale Price ÷ Gross Annual Income

Use: Quick comparable check on rental properties before doing a full cap rate analysis.

Example: A 4-plex sold for $1,200,000 with $96,000 in annual rent. GIM = 12.5. A second similar 4-plex with $108,000 rent would price around 12.5 × $108,000 = $1,350,000.

Net Operating Income (NOI)

NOI = Effective Gross Income − Operating Expenses

Use: Pre-debt-service cash flow. Excludes mortgage payments and income tax.

Example: $120,000 gross rent − $6,000 vacancy allowance − $34,000 operating costs = $80,000 NOI.

Loan-to-Value (LTV)

LTV = Loan Amount ÷ Lower of (Purchase Price, Appraised Value)

Use: Determines insurance requirement: LTV > 80% requires CMHC/Sagen/Canada Guaranty default insurance.

Example: $640,000 mortgage on $800,000 property = 80% LTV (conventional, no insurance required).

Gross Debt Service ratio (GDS)

GDS = (Principal + Interest + Taxes + 50% Condo Fees + Heat) ÷ Gross Annual Income

Use: Lender qualification. Conventional cap is 39%, insured cap is 39% (B-20 stress test rules apply on top).

Example: Annual housing costs $36,000 ÷ household income $100,000 = 36% GDS — qualifies.

Total Debt Service ratio (TDS)

TDS = (GDS components + Other Debt Payments) ÷ Gross Annual Income

Use: Includes car loans, lines of credit, student loans. Cap is 44% conventional, 44% insured.

Example: $36,000 housing + $9,600 car loan = $45,600 ÷ $100,000 = 45.6% TDS — fails.

Commission split

Total Commission = Sale Price × Commission Rate; Co-op Split typically 50/50

Use: Calculating salesperson take-home after brokerage split.

Example: $700,000 sale × 5% = $35,000 total. Listing brokerage and co-operating brokerage split 50/50 = $17,500 each. Salesperson on a 70/30 split keeps $12,250.

Per-diem proration

Daily rate = Annual Cost ÷ 365 (or actual days in period)

Use: Closing-day adjustments for property taxes, condo fees, prepaid utilities.

Example: Property tax $4,380/year = $12/day. Buyer closes Sept 1, seller already paid for full year: buyer reimburses 122 days × $12 = $1,464.

HST on new construction

HST = New Build Price × 13%; rebate applies on first $400,000 of purchase price for primary residence buyers

Use: Pricing new construction and explaining net cost to clients.

Example: $700,000 new build = $91,000 HST gross. After ON new housing rebate (max $24,000) and federal portion, net buyer cost depends on builder absorption.

Capital gains inclusion

Taxable gain = (Sale Price − Adjusted Cost Base − Selling Expenses) × 50%

Use: Investor and second-home tax planning. Principal residence is exempt.

Example: $200,000 gain on a rental property = $100,000 added to taxable income. Marginal tax rate decides actual tax owed.

CMHC premium tiers

Premium % depends on LTV: 95% LTV = 4.0%, 90% = 3.1%, 85% = 2.8%, 80.01% = 2.4%

Use: Calculating mortgage insurance cost (added to loan amount, amortized).

Example: $500,000 mortgage at 95% LTV = $20,000 premium added to loan, financed over the term.

Down payment minimums

Up to $500,000: 5%; $500,001 to $1.5M: 5% on first $500k + 10% on remainder; over $1.5M: 20% across the board

Use: Quick affordability check at the offer-table.

Example: $800,000 purchase = $25,000 (first $500k) + $30,000 (10% of remaining $300k) = $55,000 minimum down.

How candidates use the cheat sheet effectively

Print the PDF and pin it next to your study desk. For two weeks before the exam, work one math problem from each formula type per day — twelve problems daily. The repetition is what cements the formulas, not re-reading the textbook chapter. The cheat sheet stays fixed; your speed and intuition improve around it.

On exam day, the rules don't allow notes — but by then the sheet is in your head. Most candidates report the math section is the easiest part of the exam once they've drilled it, because every Ontario math question is a variation on these twelve formulas. There are no surprise formulas waiting for you.

Get the printable PDF

All 12 formulas on a single page, formatted for printing on standard letter or A4 paper.

Frequently asked questions

Is the cheat sheet specific to Ontario?

Yes — the formulas are universal but the rate tiers (CMHC premiums, down payment minimums, HST) follow current Canadian/Ontario regulations applied on the Humber exam.

Will the cheat sheet help with the broker exam too?

The 12 formulas appear on both the salesperson and broker exams. Broker candidates should also study trust account math and brokerage financial statements separately.

Can I share the PDF with classmates?

Yes. The PDF is unrestricted — share it freely with anyone studying for the exam.

How is this different from the formulas in the Humber textbook?

The Humber textbook explains each formula in chapter context with prose. The cheat sheet collects only the formula, when to apply it, and a single worked example — calibrated to exam-style phrasing rather than academic exposition.

Do I need to subscribe to ExamAce to get the PDF?

No. Submit your email and the PDF link arrives immediately. We create a free ExamAce account so you can also drill questions online — three full Humber courses are unlocked free, no card required.