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House Affordability Calculator

Estimate a comfortable home price from your income, debts, down payment and loan details.

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ItemComfortable (28/36)Stretch (36/43)
This is an estimate, not a loan offer or financial advice. Lenders set their own rules. PMI, HOA fees, maintenance and closing costs are not included, and they will lower what you can afford.

Quick Answer

A common guide is the 28/36 rule: spend no more than 28% of gross income on housing and 36% on all debts. With a $90,000 income, $400 in monthly debts, $40,000 down, a 6.5% 30-year loan, 1.1% property tax and $1,800 insurance, that points to a home price of about $304,369.

Last updated: 2 November 2026 ·How we calculate this: 28/36 rule and mortgage payment formula

Table of Contents

How This House Affordability Calculator Works

This calculator works backward from your income. It finds the most you could spend on housing each month, removes taxes and insurance, and turns what is left into a home price using your loan details.

Quick explanation: the budget is the smaller of 28% of monthly income, or 36% of monthly income minus your debts.

  • Comfortable: uses the common 28/36 guide.
  • Stretch: uses 36/43, which leaves much less room in your budget.
  • Monthly housing budget: includes principal, interest, property tax and insurance.

How to Use the House Affordability Calculator

  1. Enter your gross yearly income before tax, for you and any co-borrower.
  2. Enter your monthly debt payments, such as car, student loan and card minimums. Do not include rent.
  3. Enter your down payment, loan rate and term.
  4. Enter your area’s property tax rate and a yearly home insurance quote.
  5. Press Calculate and compare the comfortable and stretch home prices.

Core Formulas

  • Housing budget: B = min(front ratio × income, back ratio × income − debts)
  • Payment factor: f = r ÷ (1 − (1 + r) ^ −n)
  • Home price: (B − insurance + down payment × f) ÷ (f + tax rate)

Income, insurance and tax are monthly here. r is the monthly rate and n is the number of monthly payments.

Worked Example

You earn $90,000 a year, pay $400 a month in debts, and have $40,000 for a down payment. Your loan is 6.5% for 30 years, with 1.1% property tax and $1,800 a year for insurance.

  • 28% of $7,500 monthly income = $2,100
  • 36% of $7,500, minus $400 = $2,300
  • The smaller figure is $2,100, which supports a home price of about $304,369
  • The stretch budget of $2,700 supports about $387,273

Real-Life Examples

  • A lower rate: with the default example, a 5.5% rate instead of 6.5% raises the comfortable price from about $304,369 to about $330,138.
  • Saving a bigger down payment: putting $60,000 down instead of $40,000 raises it to about $321,836.
  • High monthly debts: if debts rise from $400 to $1,200 a month, the 36% limit takes over and the price drops to about $221,466. Paying off a car loan first can make a big difference.

Affordability vs Pre-Approval

  • This calculator: shows what fits your budget using cautious rules, before you speak to a lender.
  • Pre-approval: a lender checks your credit, income and debts and says how much it may lend.
  • Why they differ: lenders may approve more than feels comfortable, as their limits can be higher than 28/36.
  • Best approach: decide your own comfortable budget first, then use pre-approval to confirm it.

Home Price by Income

With $400 monthly debts, $40,000 down, a 6.5% 30-year loan, 1.1% property tax and $1,800 insurance.

Yearly incomeComfortable (28/36)Stretch (36/43)
$50,000$166,197$206,497
$70,000$239,889$304,369
$90,000$304,369$387,273
$110,000$368,850$470,176
$130,000$433,330$553,079
$150,000$497,810$635,983

What Can Change Your Budget

  • Credit score: this affects the rate you are offered.
  • PMI: a small down payment can add monthly mortgage insurance.
  • HOA fees and repairs: these are real monthly costs, so leave room for them.
  • Loan program: lenders and programs use different limits. The 28/36 rule is a guide, not a rule set by law.

Common Mistakes to Avoid

  • Using take-home pay. The 28/36 rule uses gross income before tax.
  • Forgetting PMI. Conventional loans with less than 20% down usually add mortgage insurance.
  • Ignoring upkeep. Repairs, HOA fees and utilities add to the monthly cost.
  • Spending all your savings on the down payment. Keep money for closing costs, moving and an emergency fund.
  • Buying at the stretch price. It leaves little room if income drops or costs rise.

Frequently Asked Questions

A common guide is to keep housing at 28% of gross income or less. Enter your income, debts and loan details above for an estimate.

It suggests spending up to 28% of gross income on housing and up to 36% on all debts, including housing.

No. It is a guideline. Many lenders accept higher ratios, depending on the loan and the borrower.

No. If you expect these costs, your real budget will be lower. Add them to your monthly debts for a rough estimate.

It depends on your savings and loan type. A larger down payment lowers the loan and the monthly payment. Try our Down Payment Calculator.

With no other debts, $50,000 down, a 6.5% 30-year loan, 1.1% property tax and $1,800 insurance, the 28/36 rule points to about $345,343.

Private mortgage insurance protects the lender. It is usually required on conventional loans when you put down less than 20%.

Yes. Closing costs are paid up front, often a few percent of the loan. Set that money aside on top of your down payment.

References & Sources

SourceUsed ForLink
Bankrate, What is the 28/36 rule Definition of the 28/36 guide. https://www.bankrate.com/mortgages/what-is-the-28-36-rule
Rocket Mortgage, Why the 28/36 rule matters What the ratios include. https://www.rocketmortgage.com/learn/28-36-rule
Consumer Financial Protection Bureau, Owning a home General guidance for home buyers. https://www.consumerfinance.gov/owning-a-home/