How Much House Can You Afford?
Calculate the maximum home price based on your income
Last updated: January 2025
About This Tool
The home affordability calculator helps you determine the maximum home price you can afford based on your income, debts, down payment, and other financial factors. Making an informed decision before house hunting can save you from financial stress.
What is Home Affordability Calculator?
A home affordability calculator estimates how much house you can buy based on your financial situation. It considers your gross income, existing debts, down payment, interest rates, and other costs to determine a comfortable purchase price. The calculation follows lending guidelines like the 28/36 rule used by mortgage lenders.
How It Works
The calculator uses debt-to-income (DTI) ratios to determine your maximum monthly housing payment. It factors in your income, existing debts, property taxes, insurance, and interest rates. From this maximum payment, it works backward to calculate the home price you can afford with your available down payment.
Formula
Max Home Price = Max Loan Amount + Down Payment, where Max Loan is based on 28% housing ratio and 43% total DTI
You Can Afford Up To
$365,874.25
Based on 43% DTI ratio
Recommended Price Range
Conservative
$310,993.11
Safer choice
Recommended
$365,874.25
Stretch
$402,461.68
Maximum
Summary
28/36 Rule
💡 Pro Tips
- • Keep housing below 28% of income
- • 20% down avoids PMI
- • Budget for maintenance (1-2% home value/year)
Related Tools
When to Use This Calculator
- 1Before starting your home search to set realistic expectations
- 2When planning how much to save for a down payment
- 3To understand how your debts affect your buying power
- 4When considering moving to a different city with different costs
- 5Before meeting with a mortgage lender to know your position
Pro Tips
- •Just because you can afford a certain amount does not mean you should spend it
- •Factor in maintenance costs of 1-2% of home value annually
- •Consider future expenses like children, education, or career changes
- •A larger down payment increases your buying power and reduces monthly costs
- •Pay down existing debts before house hunting to qualify for more
Common Mistakes to Avoid
- •Using the maximum approved amount instead of a comfortable amount
- •Forgetting to budget for property taxes, insurance, and HOA fees
- •Not considering future income changes or job stability
- •Ignoring maintenance, repairs, and emergency fund needs
- •Underestimating the true cost of homeownership beyond the mortgage