How Much House Can I Afford?
This works the other direction: instead of a loan you already have, it starts with your income and asks what payment you can carry, then what price that payment buys.
It uses a debt-to-income cap on the housing payment only, so property tax and insurance still need room in your budget.
Results update as you type.
How it works
Step one turns income into a payment: monthly payment cap = (annual income ÷ 12) × your chosen percentage of gross income. The 28% default is the old front-end housing rule lenders still quote.
Step two asks what loan that payment supports — the present value of the payment stream: loan = payment × (1 − (1 + r)^−n) ÷ r. Step three grosses it up to a purchase price by dividing by (1 − down payment %).
The result covers principal and interest only. Property tax, homeowners insurance and mortgage insurance below 20% down all come out of the same monthly budget, so the realistic price is lower than the number shown.
Example
$95,000 income · 20% down · 6.5% rate · 25-year term · 28% of gross cap
- Payment used: $2,217 a month.
- Approximate home price: $410,368, with an $82,074 down payment.
- Raise the cap to 36% of gross and the same income points at about $527,000 — which is roughly how lenders reach their approved maximum.
- Add roughly $300 a month of tax and insurance and the realistic price drops by over $50,000.
Worked example using the figures above — an illustration, not financial advice. Your loan documents decide the real numbers.
How Much House Can I Afford? FAQ
How much house can I afford on a $95,000 salary?
Capping housing at 28% of gross income gives a $2,217 payment, which supports roughly a $410,000 home at 6.5% over 25 years with 20% down — before tax and insurance.
What is the 28/36 rule?
Spend no more than 28% of gross monthly income on housing and no more than 36% on all debt together. Lenders still quote it, while many approval systems stretch the combined figure to 43–50%.
Does this calculator include taxes and insurance?
No — it models principal and interest only. Add property tax, homeowners insurance and mortgage insurance if you put down less than 20%, and the realistic price drops by a meaningful amount.
How does the down payment change what I can buy?
A bigger down payment raises the price reachable on the same payment, because less of the price needs financing. It is also the lever that removes mortgage insurance, which below 20% down is charged every month.
Should I borrow the maximum I qualify for?
Rarely. The approved maximum assumes nothing else in your spending changes. A payment nearer 25% of gross income survives a job change, a new roof and one car repair.
Does the calculator use gross or take-home income?
Gross. The cap is applied to annual income ÷ 12, which is what lenders quote. Take-home pay is lower after tax, insurance and retirement contributions, so check the resulting payment against your real budget before you trust it.
Related calculators
- Mortgage Payoff CalculatorFind your payoff date and interest saved.
- Amortization CalculatorSee how each mortgage payment splits between interest and principal, plus your payoff date and total interest.
- Refinance Break-Even CalculatorEnter closing costs and your old and new payments to see how many months until refinancing pays for itself.
- Mortgage Recast CalculatorSee your new monthly payment after a lump sum recast, and how much the payment drops.
- Property Tax CalculatorTurn an assessed home value and a local tax rate into an annual and monthly property tax number.
Last updated October 4, 2026. Every figure is an estimate produced in your browser — see the methodology and its limits.