This home affordability calculator works backward from income: the 28/36 lending rules set your housing budget, and taxes, insurance and your down payment turn that budget into a home price.
| Monthly housing budget (28% front rule) | – |
| Max principal & interest inside it | – |
| Loan supported | – |
| Affordable home price | – |
Income → Budget → Price: The Lender’s Assembly Line, Run in Reverse
The ratios themselves are our DTI Calculator; closing day adds our Closing Cost Calculator‘s stack. Part of our Finance Calculators collection.
Worked Numbers (Verified)
- $110,000 income: 28% front rule gives a $2,567/mo housing budget; with $400 of other debts the 36% back-end allows $2,900 — so the front rule binds here
- $2,000/mo of pure P&I at 6.75%/30 yr supports a loan of $308,357 — the conversion factor between payment comfort and borrowing power at this rate (at 5% it would be $372,000+ — rates ARE affordability)
- Taxes and insurance take their cut BEFORE the loan gets sized: at 1.1% tax on a $450k home that’s $413/mo of the budget spent before a dollar of principal — high-tax states quietly shrink prices by six figures at the same income
Affordability Discipline
- The lender’s ceiling ≠ your budget: banks underwrite the loan’s survival, not your savings rate. Pick the smaller of (bank number, your-life number).
- Rate sensitivity dominates: ±1% rate moves affordable price roughly ∓10% at the same payment — timing and credit score are price levers.
- Debts are price in disguise: every $100/mo of car/card minimums costs about $15,000 of house at typical rates — paying a card off pre-application is a price increase you control.
- Keep the post-close reserves: affordability that consumes the emergency fund converts the first roof leak into credit-card debt.
Related Tools
- Mortgage Calculator — payment for a chosen price
- DTI Calculator — the ratios lenders use
- Closing Cost Calculator — cash beyond the down payment
Frequently Asked Questions
How much house can I afford on $110,000 a year?
By the 28% rule, housing gets $2,567/mo. After typical taxes/insurance, that supports roughly a $308k loan per $2,000 of principal & interest — plus your down payment on top. This calculator solves the exact price with your rate, tax rate, insurance and debts.
What is the 28/36 rule?
Lenders’ classic guide: housing costs ≤ 28% of gross income (front-end), and housing + all debts ≤ 36% (back-end; QM rules allow higher back-end for some loans). Whichever binds harder sets your budget — this tool checks both and tells you which one bound.
How does my down payment change affordability?
Directly: price = loan supported + down payment, and a bigger down payment also cuts the loan the same budget must service. Crossing 20% down additionally removes PMI — a double win that this model approximates via the insurance field (drop it when PMI-free).
Do property taxes really change the price that much?
Yes. At 1.1%/yr, taxes consume $413/mo on a $450k home — equivalent to about $64,000 of loan at 6.75%. A 2.2% tax state halves that headroom; a 0.6% state doubles it. Same income, same rate, wildly different houses by ZIP code.
Should I buy at the maximum this calculator gives?
It’s a lender ceiling, not a recommendation. It excludes maintenance (~1%/yr), utilities growth, childcare, savings goals and sanity. Most financial planners suggest treating the number as the top of the range and shopping 10–20% below it.
Is this home affordability calculator free?
Yes — free, instant, no sign-up.