How Much House Can I Afford on My Salary?
Lenders use a simple rule of thumb to decide how much they'll lend you — and you can use the same math to set a comfortable budget before you ever talk to a bank.
"How much house can I afford?" is the first question every buyer asks. The answer depends on four things: your income, your existing debts, your down payment, and current interest rates. The fastest way to a reliable estimate is the 28/36 rule, the same benchmark lenders rely on.
The 28/36 rule explained
The rule sets two ceilings based on your gross monthly income (your income before taxes):
- 28% — the front-end ratio: Your total monthly housing payment (principal, interest, property taxes, and insurance) should stay at or below 28% of gross monthly income.
- 36% — the back-end ratio: All of your monthly debt payments combined — housing plus car loans, student loans, and minimum credit-card payments — should stay at or below 36%.
The lower of these two numbers is your realistic housing budget. If you carry significant debt, the 36% rule will limit you more than the 28% rule.
Example by salary
Here's roughly how the 28% housing ceiling translates at different incomes (before subtracting other debts):
| Annual income | Gross / month | 28% housing budget |
|---|---|---|
| $60,000 | $5,000 | ~$1,400 / mo |
| $90,000 | $7,500 | ~$2,100 / mo |
| $120,000 | $10,000 | ~$2,800 / mo |
| $150,000 | $12,500 | ~$3,500 / mo |
That monthly budget then translates into a home price depending on your rate, term, and down payment — which is exactly what the affordability tool calculates for you.
Get your personal number →Open the Affordability tab, enter your income, debts, and down payment, and see your recommended and maximum home price instantly.Don't forget the down payment
Your down payment affects affordability in two ways. A bigger down payment means a smaller loan (lower monthly payment) and may let you avoid PMI if you reach 20%. Even a smaller down payment is fine — many loans allow 3% to 5% down — but expect to pay mortgage insurance until you build equity.
What lenders look at beyond the rule
- Credit score: A higher score earns a lower rate, which directly raises how much you can afford.
- Debt-to-income ratio: Some loan programs allow a back-end DTI up to 43% or even higher, so the 36% rule is conservative.
- Cash reserves: Savings left over after closing reassure lenders and protect you.
- Job stability: Steady, documented income strengthens your application.
Afford vs. comfortable
The maximum a lender will approve is not the same as the amount you'll be comfortable paying. Leave room for maintenance, utilities, emergencies, and life. Many financially healthy buyers deliberately borrow below their ceiling. Use the recommended (conservative) figure in the calculator as your target rather than the absolute max.
The bottom line
Start with the 28/36 rule, factor in your down payment and rate, and aim for a payment that leaves breathing room in your budget. Then confirm with a lender pre-approval, which gives you an exact figure and makes your offers stronger.
Try the Affordability Tool