How Much House Can I Afford? (Based on My Income & Debt)
Find out how much house you can afford
What This Calculator Does (And What Makes It Different)
Most home affordability calculators give you a single number based on basic assumptions.
In reality, how much house you can afford depends on several moving parts - your income, existing debts, interest rates, and ongoing monthly costs.
This calculator goes deeper by showing:
- A realistic affordability range, not just a single estimate
- A full monthly payment breakdown, including taxes and insurance
- How your budget changes across different home prices
Instead of focusing only on what a lender might approve, this tool helps you understand what you can comfortably afford in real life, so you can avoid stretching your budget too thin.
How to Calculate Manually
- 1Enter your gross annual income (before taxes)
- 2Specify your down payment amount or percentage
- 3Input current mortgage interest rates
- 4Add all monthly debt obligations
- 5Review your affordable home price range
Before taxes. Include salary, bonuses, commissions
Your actual rate depends on credit score and lender
Down Payment
✓ Great! 20%+ down means no PMI
Monthly Debt Obligations
You Can Afford a Home Up To:
Affordability Range
Monthly Payment Breakdown
(Based on $348,000 home price)
Monthly Budget After Housing:
Food, gas, entertainment, savings, emergencies, etc.
Financial Health Indicators
Housing costs as % of gross income
Under 28%: Recommended
28-36%: Manageable
Over 36%: Risky
Comparison by Home Price
How different home prices affect your monthly payment and DTI
| Home Price | Down Payment | Loan Amount | Monthly P&I | Total Monthly* | DTI Ratio |
|---|---|---|---|---|---|
| $350,000 | $90,000 | $260,000 | $1,643 | $2,114 | 28% ✓ |
| $400,000 | $90,000 | $310,000 | $1,959 | $2,476 | 33% ✓ |
| $450,000 | $90,000 | $360,000 | $2,275 | $2,838 | 38% ⚠️ |
| $500,000 | $90,000 | $410,000 | $2,591 | $3,371 | 45% ✗ |
| $550,000 | $90,000 | $460,000 | $2,908 | $3,753 | 50% ✗ |
*Includes principal, interest, taxes, insurance, and HOA
What If? Calculator
Adjust to see how changes affect affordability:
✓ Yes - You can afford this!
Examples
Example 1: The typical first-time buyer household
A couple with combined gross income of $110,000/year, $500/month in existing debt (a car payment and student loans), $60,000 saved for a down payment, and a 6.5% mortgage rate. The 28/36 rule gives them a comfortable monthly housing budget of around $2,570. After accounting for property tax and insurance, that supports a home price of roughly $380,000–$410,000. With $60,000 down on a $395,000 home (about 15%), they'd pay PMI until they hit 20% equity - adding roughly $150–$200/month initially. Their real question isn't whether they can qualify; it's whether the total monthly outlay leaves enough room for savings, emergencies, and life. Running the full numbers suggests they're right at the edge of comfortable - not stretched, but without much slack.
Example 2: High income, high debt
A single buyer earning $180,000/year - which sounds like plenty - but carrying $2,200/month in existing debt: student loans, a car, and credit card minimums. That debt load eats deeply into their DTI allowance. Even at a $180k salary, the 36% total DTI ceiling limits their total debt + housing to $5,400/month. After $2,200 in existing payments, only $3,200 remains for housing - which at 6.5% over 30 years supports a loan of roughly $505,000. With 20% down, the maximum comfortable home price is around $630,000. Not low - but significantly less than most people with a $180k income assume they can afford.
Example 3: The rent-vs-buy crossover
A buyer in a market where a comparable home rents for $2,200/month and sells for $450,000. At 6.5% with 20% down ($90,000), their mortgage P&I is $2,275/month - plus taxes, insurance, and maintenance, putting the true monthly cost of ownership at $3,200–$3,500. In this scenario, renting is significantly cheaper on a monthly basis. The financial case for buying only holds if they plan to stay 7+ years (allowing appreciation and equity to offset the higher monthly cost and transaction costs) and if they value the stability and control of ownership independent of the math.
The hidden costs most buyers underestimate
The calculator covers PITI - principal, interest, taxes, and insurance. But first-time buyers consistently underestimate the ongoing costs of ownership that don't show up in a lender's pre-approval letter.
Maintenance and repairs are the biggest surprise. The standard rule of thumb is to budget 1% of your home's value per year for maintenance - so $4,000/year on a $400,000 home. Some years it's nothing; others it's a new roof ($15,000–$25,000), a furnace replacement ($5,000–$10,000), or a water heater. These aren't optional. Older homes or those with deferred maintenance can run considerably higher.
Utilities jump significantly when moving from an apartment to a house. A larger space means more to heat, cool, and power. Budget $200–$400/month more than you're used to paying, depending on the home's size, age, and energy efficiency.
HOA fees, if applicable, range from $100/month in modest communities to $1,000+/month in luxury condos or planned communities. They tend to increase over time and can include special assessments for capital repairs that you have no vote on.
Closing costs are a one-time but significant expense - typically 2–5% of the loan amount, due at closing. On a $400,000 purchase, that's $8,000–$20,000 on top of your down payment. Many buyers drain their savings on the down payment and are caught off guard by closing costs.
Property tax increases are easy to underestimate. In many states, assessed value is updated periodically, and a home purchased at today's price may see its tax bill jump significantly in the first 2–3 years of ownership. Check your state's reassessment schedule before assuming today's tax rate is locked in.
A realistic budget adds 1.5–2% of the home's value per year on top of PITI to cover these ongoing costs. On a $400,000 home, that's $6,000–$8,000/year - or $500–$667/month - that won't show up in any lender's affordability estimate.
Buying in 2026 - the affordability context
Home affordability in 2026 is among the most difficult it has been for first-time buyers since the early 1980s - and understanding why helps frame what the calculator is telling you.
The 30-year fixed mortgage rate currently sits around 6.3% - more than double the 2.65% low recorded in January 2021. At the same time, median home prices remain near record highs, having risen sharply during 2020–2022 before plateauing. The combination of higher prices and higher rates has pushed the typical monthly mortgage payment to levels that require significantly more income to qualify than just four years ago.
For context: a $400,000 home financed at 3% in 2021 carried a monthly P&I of about $1,686. The same home at today's 6.3% rate costs $2,478/month - a 47% increase in the monthly obligation for the identical purchase. And that $400,000 home likely costs $480,000–$500,000 today due to price appreciation.
The silver lining is that inventory is gradually recovering. The lock-in effect - where homeowners with sub-3% mortgages were reluctant to sell and give up their rate - is slowly easing as more households adapt to the new rate environment. As of early 2026, active listings are approaching pre-pandemic levels in many markets, giving buyers more negotiating room than they've had in several years.
None of this changes what you can afford - but it's useful context when the calculator returns a number that feels lower than you expected. The constraint isn't this tool; it's the historically difficult combination of elevated prices and elevated rates that defines this market.
FAQ
How accurate is this calculator?
This calculator provides a reliable estimate based on standard lending guidelines and the 28/36 rule used by most lenders. However, your actual approved amount may vary based on factors like your complete financial profile, the specific lender, and current market conditions. Use this as a starting point and get pre-approved for your exact budget.
What credit score do I need to buy a house?
Most conventional loans require a minimum credit score of 620, though you'll get better rates with 740+. FHA loans accept scores as low as 580 with 3.5% down, or 500 with 10% down. A higher score directly impacts your interest rate and can save you thousands over the life of your loan.
Does this include property taxes?
Yes, the calculator includes property taxes in your monthly payment estimate using the tax rate you specify in the Advanced Options (default 1.1% annually). It also accounts for homeowners insurance, HOA fees, and PMI if your down payment is less than 20%. This gives you a complete picture of your total housing costs.
How much should I put down?
While 20% down eliminates PMI and often gets better rates, it's not always necessary or optimal. FHA loans allow as little as 3.5% down, and conventional loans can go as low as 3%. Consider your savings goals, emergency fund, and whether investing the difference might yield better returns than avoiding PMI.
Why do I get a range, not a single number?
The calculator shows a range (typically ±5% of your target) because home affordability isn't one-size-fits-all. Your comfort level with debt, job stability, future expenses, and lifestyle preferences all matter. The range helps you understand your safe zone while leaving room for personal financial priorities and risk tolerance.
Should I rent or buy right now?
The honest answer depends on how long you plan to stay. The general break-even point - where the equity and appreciation of buying outweigh the lower short-term cost of renting - is typically 5–7 years in most markets under current conditions. If you're confident you'll stay at least that long, the case for buying is reasonable even at today's rates. If there's a meaningful chance you move in 2–3 years, renting is almost certainly the better financial decision: transaction costs alone (buying + selling) run 8–10% of the home's value and take years of appreciation to recover.
What hidden costs should I budget for beyond the monthly payment?
Maintenance and repairs (budget 1% of home value per year), utilities (often $200–$400/month higher than renting), closing costs (2–5% of loan amount, due upfront), and potential HOA fees. A realistic all-in budget adds $500–$700/month above the PITI figure for a typical home - costs that won't appear in any lender's pre-approval letter.
How much does my credit score affect what I can afford?
Significantly. The difference between a 680 and a 760 credit score can be 0.5–1.0% on your mortgage rate. On a $400,000 loan over 30 years, that's a difference of $120–$240/month and $45,000–$85,000 in total interest. If your score is below 740, improving it before applying - even by 3–6 months of focused effort - can meaningfully increase your buying power and reduce your lifetime cost.
Is it better to put more down or keep cash in reserve?
Putting 20% down eliminates PMI and often gets a better rate - both real savings. But depleting your entire savings to hit 20% leaves you financially exposed the moment something breaks or an emergency arises. Most financial planners suggest maintaining at least 3–6 months of expenses as an emergency fund after closing, even if it means accepting PMI temporarily. PMI on a $350,000 loan at 0.8% is about $233/month - meaningful, but less damaging than having no financial buffer in a new home.
Tips & Strategies
The 28/36 rule: Housing costs should be ≤28% of gross income. total debts ≤36%
Quick tip. 20% down payment eliminates PMI and gets better rates
Quick tip. Lower DTI ratio means easier approval and better loan terms
Don't forget to budget for maintenance. utilities, and repairs
Quick tip. Get pre-approved before house hunting to know your real budget
Things Worth Knowing
- •The total interest shock. On a $400,000 mortgage at 6.5% over 30 years, you'll pay approximately $511,000 in interest - more than the home itself. The full cost of ownership (principal + interest, before taxes and insurance) is around $911,000. This isn't a reason not to buy, but it is a reason to understand what you're committing to.
- •The 15 vs. 30 year math. A 15-year mortgage roughly doubles your monthly payment but cuts total interest by 55–60%. On a $400,000 loan at 6.5%, you'd pay about $178,000 in interest on a 15-year vs. $511,000 on a 30-year. The monthly payment difference is real ($3,491 vs. $2,528), but for buyers who can manage it, the long-term savings are substantial.
- •PMI disappears - but you have to ask. PMI is automatically cancelled when you reach 22% equity based on the original purchase price, but you can request cancellation at 20%. In a rising market, you may reach 20% equity faster than the amortization schedule suggests - and if so, getting a new appraisal to document the higher value can eliminate PMI earlier, saving hundreds per month.
- •Property taxes vary enormously by state. Effective property tax rates range from 0.28% (Hawaii) to 2.23% (New Jersey). On a $400,000 home, that's a difference of $1,120/year vs. $8,920/year - nearly $650/month. Location affects affordability far more than most buyers realize until they look at the actual tax bill.
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