How Much House Can I Afford?
Find the home price that fits your budget using the same debt-to-income guidelines lenders use, including taxes, insurance, HOA dues, and PMI.
How this affordability calculator works
Lenders look at two debt-to-income (DTI) ratios. The front-end ratio compares your total housing payment — principal, interest, property tax, insurance, HOA dues, and PMI — to your gross monthly income. The back-end ratio adds your other monthly debts. The classic guideline is the 28/36 rule: housing costs at or below 28% of gross income and total debts at or below 36%. Many loan programs allow higher ratios, so you can adjust both limits above.
The calculator takes whichever limit is tighter, then finds the highest home price whose full monthly payment fits under it. If your down payment is less than 20% of the price, it adds private mortgage insurance (PMI) at the rate you enter.
Example
With $100,000 of income, the 28% front-end limit is $2,333 a month. Subtract $500 of other debts from the 36% back-end limit ($3,000) and you get $2,500 — so the 28% housing limit is the binding one, and the home price is set so that the total housing payment equals about $2,333.
Affordable isn't the same as comfortable
These ratios are lender maximums, not budget advice. Childcare, commuting, retirement savings, and an emergency fund all compete with your housing payment, so many buyers aim below the maximum. See how much house you can afford on common salaries, and run the final numbers through our mortgage calculator.
Frequently asked questions
What is the 28/36 rule?
A common lending guideline that says your housing payment shouldn't exceed 28% of gross monthly income and your total debt payments shouldn't exceed 36%. Many lenders approve higher ratios for borrowers with strong credit or reserves.
Does a bigger down payment let me afford more house?
Yes, in two ways: it reduces the loan amount (and the monthly principal and interest), and at 20% or more it eliminates PMI on conventional loans.
Should I include rent in monthly debts?
No. Your current rent will be replaced by the new mortgage payment, so only include debts that will continue after you buy — car loans, student loans, credit card minimums, and similar.
How much does the interest rate change affordability?
A lot. A higher rate raises the principal-and-interest cost per dollar borrowed, so the same monthly budget supports a smaller loan. Try changing the rate by one point to see the difference.