How Much House Can I Afford?

On a $100,000 salary, with $500 a month in other debts and $40,000 down, the 28/36 rule supports a home of about $322,167 at 7.28%. That's a total housing payment of $2,333 a month.

Gross annual income ($)

Monthly debt payments ($)

Down payment ($)

Interest rate (%)

Loan term

Property tax (% of price/yr)

Home insurance (% of price/yr)

HOA dues ($/mo)

You can afford a home up to about

$322,167

Max housing payment $2,333/mo (limited by the 28% housing limit) · Loan $282,167 · Total DTI 34%

28% cap: $2,333/mo · 36% cap minus debts: $2,500/mo

Rates here start at the Freddie Mac PMMS average for the week of October 1, 2026: 7.28% on a 30-year fixed and 6.6% on a 15-year fixed. That survey is an average. It reflects borrowers with strong credit and about 20% down. Your quoted rate can be higher or lower. The 2026 conforming loan limit (FHFA) is $832,750 in most counties and up to $1,249,125 in high-cost areas.

The 28/36 rule explained

Many lenders start from two debt-to-income (DTI) guidelines. The front-end ratio covers housing. Principal, interest, property tax, insurance and HOA should stay at or below 28% of gross monthly income. The back-end ratio covers all debt. Housing plus every other monthly debt payment should stay at or below 36%. That means car loans, student loans and credit card minimums too. Whichever limit is lower sets your budget.

The CFPB notes that many lenders approve higher DTIs. Some programs go to 43% or more. But a lower DTI leaves more room for savings and repairs.

Worked example

Gross monthly income: $100,000 ÷ 12 = $8,333.33.
28% housing cap: $8,333.33 × 0.28 = $2,333.33.
36% total-debt cap: $8,333.33 × 0.36 − $500 debts = $2,500.00. The lower number, $2,333.33, is your max housing payment (the 28% housing limit binds).
Each $1 borrowed at 7.28% for 30 years costs 0.006842 a month; each $1 of price adds 0.00125 a month in tax (1%) and insurance (0.5%), both assumed.
Price = ($2,333.33 + 0.006842 × $40,000) ÷ (0.006842 + 0.00125) = $322,167, so the loan is $282,167.

Paying off that $500 monthly debt would raise the budget to about $322,167. The reason is simple. The 28% cap ($2,333) would become the limit instead. Also, this estimate leaves out PMI. With less than 20% down, add PMI and expect a lower price.

Affordable home price by income

Assumes $40,000 down, no other debts, 7.28% for 30 years, 1% property tax and 0.5% insurance.

Annual income	Max housing payment	Home price	With $500/mo debts
$50,000	$1,167	$177,994	$157,398
$60,000	$1,400	$206,829	$194,471
$75,000	$1,750	$250,081	$250,081
$90,000	$2,100	$293,333	$293,333
$100,000	$2,333	$322,167	$322,167
$120,000	$2,800	$379,837	$379,837
$150,000	$3,500	$466,341	$466,341
$175,000	$4,083	$538,427	$538,427
$200,000	$4,667	$610,514	$610,514
$250,000	$5,833	$754,687	$754,687

Frequently asked questions

What is a good debt-to-income ratio for a mortgage?

The classic guideline is 28% for housing and 36% for all debts. The CFPB describes 43% as a common upper limit for many qualified mortgages. Some programs allow more with strong credit or reserves. But a lower DTI means more breathing room.

Does the 28% rule use gross or take-home pay?

Gross pay. That's income before taxes and deductions. Take-home pay is lower. So the same payment is a bigger share of what actually reaches your account. Budget from both numbers.

How much house can I afford on $100,000 a year?

About $322,167 with $40,000 down and no other debts at 7.28%, or about $322,167 if you also pay $500 a month on other debts.

How do interest rates change what I can afford?

At a fixed payment, a higher rate means a smaller loan. A $2,333 housing budget buys noticeably less house at 8% than at 6%. Try both rates in the calculator.

Are closing costs included?

No. Closing costs, moving costs and an emergency fund all come out of cash. That's on top of the down payment. So don't put every dollar you have into the down payment.

Related calculators

Sources

Updated: October 2, 2026 · Sources and methodology