Home Affordability Calculator

A common starting point is 3–4 times gross annual income. On an $80,000 salary, that suggests $240,000–$320,000 - though down payment, debts, and rates push the answer up or down. The 28/36 rule (housing ≤ 28% of gross income, total debt ≤ 36%) gives a more precise affordability ceiling. Use the calculator to model both metrics for your specific situation.

Conventional loans accept 3%–5% down for first-time buyers, FHA loans 3.5%, VA and USDA loans 0%. Less than 20% down requires PMI (0.3%–1.5% of loan annually) or a higher rate. Many buyers stretch to 20% to skip PMI, but with high home prices, the wait to save 20% can cost more in lost appreciation than PMI itself.

Beyond the down payment, expect closing costs of 2%–5% of the purchase price (lender fees, title insurance, escrow), prepaid taxes and insurance, moving expenses, and immediate maintenance/repairs. Ongoing: property taxes, homeowners insurance, HOA dues if applicable, utilities (often higher than renting), and 1%–4% of home value annually for maintenance and repairs.

Lenders calculate debt-to-income (DTI) including the new mortgage payment plus all other monthly debt. Most conforming loans cap DTI at 43%–45%; FHA allows up to 50%–57% with strong compensating factors. Paying down a $300/month car loan can increase your maximum mortgage payment by roughly the same amount, raising your purchase price by tens of thousands.