Home Affordability Calculator
Estimate the home price you can comfortably afford.
How Much House Can You *Really* Afford?
It's easy to get carried away by dream homes, but the most important first step in buying a house is determining a realistic budget. This calculator gives you a solid estimate based on the same rules that lenders use. It helps you ground your search in reality, preventing the disappointment of looking at properties outside your financial reach and providing a strong starting point for discussions with real estate agents.
How to Estimate Your Budget
This calculator uses the 28/36 rule, a standard lending guideline, to estimate your affordable home price. You'll need four key numbers:
- Gross Annual Income: Your total household income before taxes.
- Total Monthly Debts: All your recurring debt payments (car loans, student loans, credit cards, etc.), *excluding* your current rent.
- Down Payment: The cash you have saved for the initial payment on the home.
- Interest Rate: The current mortgage interest rate you expect to qualify for.
The calculator will then provide you with an estimated affordable home price and the corresponding monthly payment.
What is the 28/36 Rule?
The 28/36 rule is a guideline used by lenders to assess affordability. It states that:
- Your total housing expenses (mortgage, taxes, insurance) should not exceed **28%** of your gross monthly income.
- Your total debt payments (housing + all other debts) should not exceed **36%** of your gross monthly income.
This calculator uses the more conservative of these two limits to determine your affordable monthly payment, ensuring you don't become "house poor."