How much house can you actually afford? That can be a very different question from how much a lender may be willing to approve.
A home may look affordable when you only look at the mortgage payment. But once you add property taxes, homeowners insurance, PMI, HOA fees and your existing monthly debt, the number can look quite different.
Your income matters, but income is only part of the picture. Your down payment, mortgage rate, loan term and recurring debts can all change the amount of housing that fits within your budget.
This free Home Affordability Calculator gives you a starting point. Enter your household income, monthly debt, down payment, mortgage rate and estimated home costs to see an estimated home price and monthly housing budget.
The most expensive home you could potentially qualify for is not necessarily the most comfortable home for your budget. Leave room for savings, repairs, emergencies and the other things you spend money on.
This calculator was created by Revisiting Tools as an educational planning tool. It estimates a possible home price from the income, debt, mortgage and housing-cost assumptions you enter.
It is not a mortgage approval, prequalification or personalized financial recommendation. Lenders can use different underwriting rules, loan programs and debt-to-income requirements.
Home Affordability Calculator
Enter your income, monthly debts, down payment and estimated home costs to get an approximate home price that fits within your selected debt-to-income assumption.
This calculator provides estimates for educational purposes. Your actual affordable home price may be different because lenders, loan programs, interest rates, taxes, insurance, debt requirements and individual financial circumstances vary.
What Does Home Affordability Really Mean?
Home affordability is not simply the highest mortgage amount a bank might approve. It is the amount of housing expense that can reasonably fit into your overall financial situation.
Two households can earn exactly the same income and still have very different housing budgets. One might have a car payment and student loans, while another might have very little monthly debt.
Savings also matter. If buying a home uses nearly all of your available cash, the monthly payment may not tell the whole story.
That's why a useful affordability estimate should look at income, existing debt, financing and other recurring housing costs together.
How Does This Home Affordability Calculator Work?
The calculator starts with your gross monthly household income. It then applies the maximum debt-to-income percentage you enter to estimate the total monthly amount available for existing debt and housing.
Your existing monthly debt is subtracted from that amount. What remains is the estimated monthly housing budget used by the calculator.
The calculator then works backward from that housing budget to estimate a home price based on your down payment, mortgage rate, loan term, property taxes, insurance, PMI and HOA fees.
In simple terms, the calculation asks: "What home price produces a monthly housing cost that fits within the assumptions I entered?"
What Does the Result Tell You?
The main result is an estimated affordable home price. It represents the approximate purchase price that fits the assumptions entered into the calculator.
You'll also see an estimated monthly housing cost, mortgage amount, down payment, principal and interest, property taxes, insurance, PMI, HOA fees and the combined debt-to-income percentage.
The calculator also shows estimated income remaining after the assumed monthly housing cost and existing debt.
The result is a planning estimate, not a recommended purchase price. Your personal budget may be more conservative than the percentage used by a lender or by this calculator.
How Does Income Affect How Much House You Can Afford?
Income is one of the biggest pieces of the affordability puzzle. Higher gross income generally creates more room for housing expenses, assuming other financial obligations remain similar.
For this calculator, enter your gross annual household income before taxes and other deductions.
For example, a household earning $100,000 per year has a gross monthly income of about $8,333 before taxes and other deductions.
That doesn't mean the household should spend a particular amount on housing. It simply gives the calculator a starting point for estimating a possible budget.
Why Does Existing Debt Reduce Home Affordability?
Existing debt takes part of your monthly income before you even make a housing payment.
Depending on your circumstances, recurring debt can include things such as auto loans, student loans, credit card obligations and other qualifying payments.
Consider two households earning the same $100,000 per year. If one has $300 in monthly debt and the other has $1,800, their available housing budgets can be very different.
That's why entering your monthly debt can make this calculator much more useful than simply multiplying your income by a home-price rule.
What Is Debt-to-Income Ratio?
Debt-to-income ratio, or DTI, compares monthly debt obligations with gross monthly income.
For example, if a household has $8,000 in gross monthly income and $2,400 in combined qualifying monthly obligations, the ratio would be 30%.
Different lenders and loan programs can use different requirements. There is no single DTI percentage that guarantees mortgage approval.
The calculator therefore lets you choose the percentage yourself. This makes it possible to test a more conservative assumption as well as a higher one.
Why Does the Calculator Start at 36%?
The calculator uses 36% as its default debt-to-income assumption simply to provide a reasonable starting scenario for testing.
It is not a universal rule and it is not a recommendation that you should spend 36% of your income on housing and debt.
Try changing the percentage and see how the estimated affordable home price changes. A lower percentage produces a more conservative result, while a higher percentage generally allows a larger estimated home price.
How Does Your Down Payment Affect Affordability?
Your down payment is the portion of the home's purchase price that you pay upfront rather than borrowing.
A larger down payment usually means a smaller mortgage balance. A smaller balance can reduce the principal-and-interest payment and the amount of interest paid over the life of the loan.
A larger down payment can also affect mortgage insurance requirements depending on the loan.
But there is a trade-off. Money placed into the home is no longer available for other purposes. You may want cash available for closing costs, moving, emergencies, repairs and other financial goals.
How Does the Mortgage Interest Rate Affect Affordability?
The interest rate can change how much home fits within the same monthly budget.
Imagine two buyers with the same income, debt and down payment. If one faces a higher mortgage rate, the principal-and-interest payment for the same loan amount will generally be higher.
That means the higher-rate scenario may support a lower home price if the buyer wants to keep the same monthly housing budget.
Try comparing several rates in the calculator instead of relying on one number.
How Does the Loan Term Change Affordability?
The loan term determines how many monthly payments are used to repay the mortgage.
A longer term can produce a lower required principal-and-interest payment because the loan is spread across more payments.
However, paying a mortgage for longer can also mean paying more interest over the full repayment period.
A shorter term usually requires a higher monthly payment but can reduce total interest when the rate and loan amount are otherwise the same.
How Do Property Taxes Affect How Much House You Can Afford?
Property taxes are an important part of the monthly housing budget. The amount can vary significantly depending on the property and location.
Two homes with similar purchase prices can have different property tax bills because of differences in local tax rates, assessments, exemptions and other factors.
The calculator uses the percentage you enter as a simplified estimate. It is not intended to reproduce an official property tax assessment.
How Does Homeowners Insurance Affect Affordability?
Homeowners insurance is another recurring cost that can be easy to overlook when estimating a mortgage payment.
Premiums can vary depending on the property, location, coverage, deductible, insurer and other factors.
Enter your estimated annual premium so the calculator can include its monthly effect on the housing budget.
What Is PMI?
Private mortgage insurance, commonly called PMI, may apply to certain conventional mortgages when the down payment is relatively small.
PMI costs aren't the same for every borrower. They can depend on the loan and borrower characteristics.
Because of that variation, the calculator lets you enter your own estimated monthly PMI amount.
How Do HOA Fees Affect Home Affordability?
A home in a homeowners association may have a recurring HOA fee. Depending on the community, the fee can help pay for shared amenities, maintenance or other services.
A property with a relatively attractive purchase price can still have a noticeably higher monthly housing cost if HOA dues are substantial.
If the home you're considering has an HOA, enter the estimated monthly fee into the calculator.
Maximum Home Price vs. Comfortable Home Price
This distinction is worth paying attention to.
A calculator can produce a maximum estimated home price based on a particular income and debt assumption. That doesn't mean you need to shop at that price.
Maybe you want to save more each month. Maybe you expect childcare expenses to increase. Maybe you want room for travel, hobbies or an emergency fund.
Those personal priorities aren't captured by a simple affordability formula.
For many buyers, the better question isn't "What's the most expensive home I can buy?" but "What home payment would still leave me comfortable?"
Example: How Much House Could a $100,000 Income Afford?
Suppose a household earns $100,000 per year and has $800 in monthly debt payments. Imagine a 20% down payment, a 6.5% mortgage rate and a 30-year loan.
The household might then enter an estimated property tax rate, homeowners insurance, PMI and HOA fee.
The calculator combines those assumptions and produces an estimated home price that fits within the selected debt-to-income assumption.
Now change the down payment to 10%. Then try a 7% mortgage rate. Finally, increase the monthly debt.
The estimated affordable home price should move as those assumptions change. That's the real value of the calculator: it lets you see how sensitive your housing budget is to different situations.
Try These Home Affordability Scenarios
Instead of running the calculator once and treating the result as an answer, try a few scenarios.
- Compare a 10% down payment with a 20% down payment.
- Compare a 6.5% rate with a higher rate.
- Test what happens if your monthly debt increases.
- Add an HOA payment if the property has one.
- Increase the property tax estimate.
- Compare a conservative DTI assumption with a higher assumption.
- Try a different loan term.
If the affordable home price changes substantially between scenarios, that's useful information. It tells you which assumptions deserve closer attention before you start shopping.
What Homeownership Costs Are Not Included?
No affordability calculator can capture every expense associated with owning a home.
This calculator does not estimate several costs that can vary widely from one property to another.
- Utilities
- Routine maintenance
- Major repairs
- Landscaping
- Appliance replacement
- Home improvements
- Moving expenses
- Closing costs
- Mortgage origination fees
- Discount points
- Inspection costs
- Appraisal costs
That doesn't make the calculator useless. It simply means the result should be treated as one part of your home-buying research.
Don't Forget About Your Cash Reserves
The monthly payment isn't the only number that matters when buying a home.
You may need cash for the down payment, closing costs, moving expenses and repairs. Once you become a homeowner, unexpected expenses can also appear.
For that reason, an affordable monthly payment can still be a poor fit if the purchase would leave you with very little cash afterward.
Before treating an estimated home price as your target, look at what would remain in your savings after the purchase.
Why Your Lender May Give You a Different Number
Don't be surprised if a mortgage lender gives you a different affordability figure from this calculator.
A lender can consider factors such as credit history, employment, assets, loan type, property details, qualifying debts and its own underwriting requirements.
The lender may also calculate certain expenses differently from this tool.
Use this calculator for planning and scenario testing. When you're actually applying for a mortgage, rely on the lender's official disclosures and loan documents for the terms of the loan.
Home Affordability vs. Mortgage Payment
These two calculators answer different questions.
| Tool | Main Question |
|---|---|
| Home Affordability Calculator | What home price might fit my income and debt? |
| Mortgage Payment Calculator | What might the monthly payment be for a particular loan? |
| Rent vs. Buy Calculator | How might renting compare with buying? |
Found a Home Price? Check the Mortgage Payment
Once you have an approximate affordable home price, the next step is to examine the mortgage payment for a specific property.
Our Mortgage Payment Calculator lets you estimate principal, interest, property taxes, homeowners insurance, PMI and HOA costs.
What If You're Still Deciding Between Renting and Buying?
Affordability isn't the only reason someone chooses to rent or buy. How long you expect to stay, transaction costs, maintenance, rent growth and changes in home value can also matter.
If you're still comparing the two options, try our Rent vs. Buy Calculator .
Frequently Asked Questions
Common questions about income, debt, mortgage rates and how much home you may be able to afford.
How much house can I afford?
It depends on your income, existing debt, down payment, mortgage rate, loan term, property taxes, insurance and other housing costs. Use the calculator above to test your own numbers.
How much house can I afford with a $100,000 salary?
There is no single home price that applies to everyone earning $100,000. Monthly debt, down payment, interest rate, taxes, insurance and other costs can produce very different affordability results.
Does existing debt reduce how much house I can afford?
Yes. Existing monthly debt uses part of the income available for housing and can reduce the estimated affordable home price.
Does a larger down payment increase affordability?
Generally, a larger down payment means a smaller mortgage balance. That can reduce the monthly principal-and-interest payment and may allow a higher home price to fit within the same monthly budget.
Does the calculator include property taxes?
Yes. Enter an estimated annual property tax percentage and the calculator includes an estimated monthly property tax expense.
Does the calculator include homeowners insurance?
Yes. Enter your estimated annual homeowners insurance premium and the calculator converts it to a monthly amount.
Does the calculator include PMI?
Yes. You can enter an estimated monthly PMI amount. Actual PMI requirements and costs depend on the loan and borrower.
Does the calculator include HOA fees?
Yes. Enter the estimated monthly HOA payment if the property is part of a homeowners association.
Is the maximum affordable home price what I should spend?
Not necessarily. The result is based on mathematical assumptions. Your personal budget, savings goals, emergency fund and other expenses may justify choosing a lower home price.
Can mortgage rates change how much house I can afford?
Yes. A higher rate generally increases the principal-and-interest payment for the same loan amount. That can reduce the home price that fits within a fixed monthly budget.
Does this calculator guarantee mortgage approval?
No. This is an educational planning tool. Mortgage lenders use their own underwriting requirements and can consider credit, income, employment, assets, debts, loan programs and property details.
Why is my lender's number different?
Your lender may use different assumptions and underwriting rules. Property taxes, insurance, loan terms, qualifying debts, fees and other factors can also produce a different result.
Is this calculator financial advice?
No. The calculator provides estimates for educational and planning purposes. It is not financial, mortgage, tax, legal or investment advice.
Home Affordability Calculator: The Bottom Line
How much house you can afford isn't determined by your salary alone. Your existing debt, down payment, mortgage rate, loan term, property taxes, insurance and other housing costs all have a role.
More importantly, the maximum number produced by a calculator isn't necessarily the number you should spend.
Run several scenarios. Try a different down payment. Change the interest rate. Add an HOA payment. Increase your monthly debt. Then look at how much the result changes.
The goal isn't to find the biggest possible mortgage. It's to understand what your numbers look like before you start making one of the biggest financial decisions you'll make.
After estimating your affordable home price, use our Mortgage Payment Calculator to examine the estimated payment for a specific home.
Related Calculators
- Mortgage Payment Calculator
- Rent vs. Buy Calculator
- Down Payment Calculator
- Property Tax Calculator
- Closing Cost Calculator
- Homeownership Cost Calculator