Home Affordability Calculator
U.S. Flagship #01Loans & MortgagesHow much house you can afford.
Income & loan terms
Enter your income to estimate the home you can afford.
Advanced — debts, DTI, taxes, PMI & costs
Enter your income to estimate the home you can afford.
How this is calculated
- 1Your monthly housing budget is the lower of the front-end ceiling ($0) and the back-end ceiling after debts ($0): $0.
- 2Take off $0 of HOA dues, leaving $0 for principal, interest, property tax, insurance and any PMI.
- 3Because tax, insurance and PMI scale with the price, the tool solves in closed form for the price whose total monthly cost fits $0 at 0.00% over 0 years.
- 4That price is $0: a $0 loan on top of your $0 down payment (0% down).
- 5All in, that's $0 a month and $0 of cash to buy (down payment plus closing costs).
Formulas
| Metric | Formula | Your value |
|---|---|---|
| Max monthly payment | min(income × front, income × back − debts) | $0 |
| Home you can afford | (budget − HOA + a × down) / (a + τ) | $0 |
| Maximum loan | home price − down payment | $0 |
| Total-debt-to-income | (monthly payment + debts) / income | 0.0% |
| Cash needed to buy | down payment + closing % × home | $0 |
Your inputs
| Input | What it means | Your value |
|---|---|---|
| Annual income | Pre-tax income; every debt-to-income ceiling is measured against it. | $0 |
| Down payment (cash) | Cash you bring; it's added on top of the loan you qualify for. | $0 |
| Mortgage rate | The mortgage rate; a higher rate buys a smaller loan from the same budget. | 0.00% |
| Loan term | Years to repay; longer terms support a bigger loan per dollar of budget. | 0 yrs |
| Max housing share of income | The share of income allowed for the home payment alone. | 0% |
| Max total-debt share | The share of income allowed for the home payment plus all other debts. | 0% |
Know what this estimate is based on
- Jurisdiction
- United States home-buying planning model
- Rules and time period
- User-entered planning assumptions; mortgage rates and local ownership costs are not live quotes.
- Scope and limitations
- Affordability range only, not an approval or prequalification. Lenders may use different income, debt, credit, reserve, property, insurance, tax, PMI, fee, and DTI assumptions.
- Source links checked
- Jul 30, 2026
Built and regression-tested by Smart Tools Lab. It has not been individually reviewed by a licensed financial, tax, or legal professional.
How to use
- 01
Enter your annual income, the cash you have for a down payment, the mortgage rate you expect and the loan term in years — the headline updates to the highest home price your income can support.
- 02
Open Advanced to set the two debt-to-income limits (the front-end housing share, 28% by default, and the back-end total-debt share, 36% by default), add your other monthly debts, and tune property tax, home insurance, the PMI rate, HOA dues and closing costs.
- 03
Read the home you can afford, the supported loan, the all-in monthly payment split into principal, interest, tax, insurance, PMI and HOA, the cash you need to close, your debt-to-income gauge and the conservative-to-aggressive affordability range.
Formula
This tool works backwards from your income to a home price. It first turns your annual income into a monthly figure, then sizes your monthly housing budget as the smaller of two debt-to-income ceilings. The front-end ceiling is income times the housing share you set: frontCap = income x (front / 100), 28% by default. The back-end ceiling is income times the total-debt share, less your other monthly debts: backCap = income x (back / 100) - debts, 36% by default. The budget is the lower of the two, never below zero, and whichever rule bites first is the binding limit. Flat HOA dues are taken straight off that budget, leaving what is available for principal, interest, property tax, insurance and PMI. Because tax, insurance and PMI all scale with the home's price or loan, the price sits on both sides of the equation, so the tool solves it in closed form rather than guessing. Writing a for the monthly principal-and-interest payment per dollar of loan - a = i / (1 - (1 + i)^-n), with i = rate / 100 / 12 and n = term x 12 - and tau for the monthly tax-plus-insurance rate per dollar of value, the affordable price is home = (budget - HOA + a x down) / (a + tau), and the loan is home minus your down payment. PMI is conditional: it is charged only while the down payment is under 20% of the price, so the tool solves once without it and, if the resulting loan-to-value still tops 80%, re-solves with the monthly PMI rate added to a. Cash to close is your down payment plus closing costs, a percentage of the price. Finally the tool re-runs the whole solve at a cautious 25/33 stance and an aggressive 36/43 stance to bracket your price with an affordability range, and grades the result from your back-end ratio and how much equity you put down. A larger down payment raises the price, lowers the loan and, at 20%, removes PMI; raising your other debts lowers the back-end ceiling until it becomes the binding limit.
Example
Take the defaults: an annual income of 1,200,000 (100,000 a month), 600,000 in cash for the down payment, a 6% rate over 30 years, a 28% housing share and a 36% total-debt share, with property tax at 1.1%, insurance at 0.35% and PMI at 0.5% a year, no HOA and 3% closing costs. The front-end ceiling is 100,000 x 0.28 = 28,000 and the back-end ceiling is 100,000 x 0.36 = 36,000, so with no other debts the 28,000 housing share binds. Solving for the price gives a home you can afford of about 4,179,000 behind a supported loan of about 3,579,000. Because the 600,000 down is only 14.4% of the price - under 20% - PMI applies, so the 28,000 budget splits into roughly 21,460 of principal and interest, 3,831 of property tax, 1,219 of insurance and 1,491 of PMI, which add back to the full 28,000. You would need about 725,000 of cash to close: the 600,000 down payment plus roughly 125,000 of closing costs. Hold everything steady and move only the rate and the same income reaches about 4,500,000 at 5%, 4,179,000 at 6%, 3,895,000 at 7% and 3,643,000 at 8% - a single point from 6% to 7% trims roughly 284,000 off the home you can afford. Add 15,000 of other monthly debts and the back-end ceiling drops to 21,000, now below the housing share, so the back-end binds and the affordable home falls to about 3,261,000 even though your income never changed. The affordability range frames the same budget as a band: about 3,785,000 at a cautious 25/33 stance up to about 5,229,000 at an aggressive 36/43 stance.
Definitions
- Annual income
- Your pre-tax yearly income; the tool divides it by 12 and measures both debt-to-income ceilings against the monthly figure, so higher income lifts every limit proportionally (0 to 6,000,000 a year).
- Down payment
- Cash you bring to the purchase; it is added on top of the supported loan, so a larger deposit raises the price you can reach, lowers the loan, and at 20% removes PMI (0 to 20,000,000).
- Front-end DTI (housing share)
- The share of monthly income allowed for the home payment alone, the lender's primary affordability gate, 28% by default (10% to 50%).
- Back-end DTI (total-debt share)
- The share of income the home payment plus all your other monthly debts may take, 36% by default and commonly capped at 43%; whichever ceiling is lower sets your budget (10% to 60%).
- Other monthly debts
- Card minimums, car and student-loan payments; subtracted from the back-end ceiling, and if that pulls it below the housing share the back-end becomes the binding limit (0 to 500,000).
- Property tax
- Annual property tax as a percentage of the home's value; because it scales with price it is part of the closed-form solve, claiming a slice of the budget before the loan is sized (0% to 5% a year).
- Home insurance
- Annual homeowner's insurance as a percentage of value; like property tax it scales with price and shares the monthly budget with principal and interest (0% to 3% a year).
- PMI
- Private mortgage insurance, an annual percentage of the loan charged only while your down payment is under 20%; it raises the monthly cost and lowers the price you can afford (0% to 3% a year).
- HOA dues
- Flat monthly homeowners-association or condo fees; a fixed cost taken off the top of your housing budget before the loan is sized (0 to 50,000 a month).
- Closing costs
- Upfront fees as a percentage of the price - title, origination, taxes and the like - added to your down payment to give the cash you need to close (0% to 10%).
- Cash to close
- The total upfront money a purchase needs: your down payment plus closing costs. It is always more than the deposit alone, and the tool shows it so you can plan beyond the down payment.
- Home you can afford
- The headline result: the supported loan plus your down payment, the highest purchase price your income, debts, rate and loan terms can sustain.
Good to know
Front-end and back-end ratios: the two gates every budget passes
Lenders do not look at a single affordability number; they look at two, and your budget has to clear both. The front-end ratio measures the home payment by itself against your gross income, asking what share of your earnings the house alone will consume. The back-end ratio is broader, adding every other monthly debt payment to the home payment before comparing the total to income, so a car loan, a student loan, or a card minimum all count against the same pool. This calculator builds both gates explicitly and lets you set each one. The front-end gate is the housing share, defaulting to twenty-eight percent of income. The back-end gate is the total-debt share, defaulting to thirty-six percent of income, with your other monthly debts subtracted from it first. The budget you actually get is the lower of the two, because the tighter rule is the one a lender will enforce. With the default inputs the front-end gate produces twenty-eight thousand and the back-end gate produces thirty-six thousand, so the front-end share is what binds and your other debts have room to spare. Those defaults are exactly the widely quoted twenty-eight and thirty-six rule of thumb, but neither is locked: you can raise the back-end toward the forty-three percent that many programs allow at their outer limit, or tighten either dial to be more conservative. Understanding which gate is binding tells you what to fix. If the front-end share is the constraint, only more income, a lower rate, or a bigger deposit moves the price. If the back-end is the constraint, clearing other debts is the fastest way to unlock more home, because every payment you eliminate hands its room straight back to your housing budget.
How the down payment sets both the loan and the price you reach
The down payment occupies a special place in this calculation because it does two things at once. The supported loan is sized from your monthly payment budget, your rate and your term, so cash you bring to the table does not inflate it. Instead the deposit is layered on to produce the price, which means a larger down payment raises the home you can afford while shrinking the mortgage you carry away from the closing. In the default scenario a six hundred thousand deposit reaches a home of about four million one hundred eighty thousand behind a loan of roughly three million five hundred eighty thousand; raise the deposit to eight hundred thousand and the affordable home climbs to about four million three hundred fifty thousand while the loan actually falls to around three million five hundred fifty thousand. Notice the price does not rise by the full extra deposit, and the loan does not stay fixed: a pricier home owes proportionally more property tax and insurance, which claims a little of the budget back from principal and interest, so each extra unit of deposit lifts the price by somewhat less than one for one and trims the loan at the same time. That still makes the deposit uniquely powerful. Income, rate and term all change affordability only by changing the monthly commitment; the down payment lifts the price you can reach without asking your budget to stretch any further. It also reshapes the rest of the purchase: a smaller loan means less interest over the life of the mortgage, often a better rate as the loan-to-value ratio falls, and below certain thresholds the removal of mortgage insurance. The deposit is therefore the lever most worth growing before you shop, because its benefits compound across price, payment and rate together.
Why mortgage rates dramatically reshape your buying power
Of all the inputs, the rate is the one that can move your affordable price the most for a change that feels small on paper. The reason is structural. Your monthly payment budget is fixed by your income and the shares you allow, and that budget is converted into a loan by discounting it over the term at the rate. A higher rate means a larger slice of every payment is consumed by interest, leaving less to repay principal, so the same payment supports a smaller loan and therefore a smaller home. The effect is not linear and it is not gentle. Hold the default twenty-eight thousand budget steady and the supported home is about four million five hundred thousand at five percent, four million one hundred eighty thousand at six percent, three million eight hundred ninety-five thousand at seven percent, and three million six hundred forty-three thousand at eight percent. A single point from six to seven erases roughly two hundred eighty-four thousand of buying power, and the income that produced it never changed. This is why the same household can afford a noticeably different house from one year to the next purely because the rate environment shifted. It also explains why rate shopping is not a minor optimization. A quarter point saved is real money in price terms, and a rate lock protects the budget you planned around while you search. The buying-power table in this tool exists to make the sensitivity visible at a glance, so you can see the price your budget reaches across a band of rates rather than betting everything on a single quoted number that may have moved by the time you are ready to buy.
PITI: the full housing cost beyond principal and interest
The supported loan in this calculator is built on the principal-and-interest portion of your payment, but that is not the whole of what you will write a check for each month. The industry shorthand for the complete payment is PITI, standing for principal, interest, taxes and insurance, and the last two letters matter enormously to what you can actually afford. Property tax is levied annually but usually collected monthly through an escrow account, and homeowners insurance is required by any lender holding the loan. On top of those, a deposit below a certain threshold often triggers private mortgage insurance, and a property in a managed community may carry homeowners association dues as well. None of these reduce your loan, but all of them compete for the same housing budget. This is exactly why the tool takes property tax and insurance as annual percentages of the home's value rather than ignoring them. Because those costs rise with the price, and the price is the very thing being solved for, the calculator handles them together in one step: your housing budget must cover principal and interest plus tax plus insurance, so the more those carrying costs claim, the smaller the loan and the lower the price. Raising the property-tax rate from one percent to two, for instance, visibly pulls the affordable home down even though your income, rate and term are unchanged, because a larger share of every month now goes to the tax and insurance line rather than to the mortgage. Ignoring these costs is one of the most common ways buyers overshoot. A price that looks affordable on principal and interest alone can become a monthly strain once taxes, insurance and association dues are added. Estimating them honestly and entering them as percentages gives you a price that reflects the real payment rather than a flattering fragment of it.
Pre-qualification versus pre-approval, and what this number is
When you start shopping you will meet two similar-sounding terms that carry very different weight, and it helps to know where this calculator sits between them. Pre-qualification is the lightest touch. You tell a lender your income, debts and assets, they apply the same kind of ratios this tool uses, and they hand back an estimate of what you might borrow. Nothing is verified, no documents change hands, and the number is only as good as the figures you supplied. Pre-approval is a serious step further. The lender pulls your credit, collects pay records, bank statements and tax returns, and issues a conditional commitment to lend a specific amount on specific terms. Sellers treat a pre-approval as real because it has been underwritten; they often treat a pre-qualification as merely hopeful. The price this calculator produces is best understood as a careful pre-qualification estimate. It applies the same affordability logic a lender uses and it respects both the front-end and back-end ceilings, so it is far more grounded than a guess. But it knows only what you typed. It cannot see your credit score, your employment stability, your cash reserves, or the particular loan program a lender will steer you toward, all of which can move the final figure up or down. Use this number to decide which price ranges are worth exploring and to walk into a lender conversation already oriented. Then convert it into a pre-approval before you make offers, both because the verified figure is more accurate and because, in a competitive market, an offer backed by a pre-approval is taken seriously while one backed only by an estimate is often set aside.
What you can borrow versus what you should
This calculator answers the question of the maximum, the highest price your income and terms will sustain under the lender's ceilings. That is a useful number, but it is a ceiling, not a target, and the distance between can borrow and should borrow is where a comfortable purchase separates from a stressful one. Lender ratios are designed to predict whether you will repay the loan, not whether you will live well while doing it. A back-end limit that allows thirty-six or even forty-three percent of income across all debts can be technically approvable and still leave too little for retirement saving, travel, childcare, or simply the slack that makes life pleasant. Borrowing to the maximum also removes your margin for error. Every input here is an assumption: the rate could be higher when you lock, the taxes could be underestimated, your income could dip. A purchase sized to the absolute limit has no room to absorb any of those, so a small surprise becomes a real problem. There is a strong case for deliberately buying below the ceiling. Set the housing share in this tool lower than the maximum you could clear, perhaps to twenty-five percent rather than twenty-eight, and look at the price that produces. The gap between that figure and the maximum is your cushion, and it buys real things: the ability to keep saving, to weather a job change, to handle a major repair without borrowing again. The most financially comfortable buyers are rarely the ones who stretched to the top of their approval. They are the ones who treated the maximum as information about the boundary and then chose a price that left them room to breathe, save and absorb the inevitable surprises of owning a home.
Stress-testing affordability against rate rises and income shocks
An affordability figure is a snapshot taken under one set of assumptions, and the assumptions will not all hold. Stress-testing means deliberately worsening the inputs to see whether the purchase still works when conditions turn against you, and this calculator makes that easy because every assumption is a field you can move. The first test is the rate. If you are quoting at six percent, rerun the numbers at seven or eight and look at the price you can still reach. You already know from the buying-power table that a single point can cost hundreds of thousands of price, so if a higher rate would push you out of the homes you want, that fragility is worth knowing before you commit rather than after. The second test is income. Lower the income field to reflect a plausible setback, a reduced bonus, a move to a single earner, a period between jobs, and see whether the price you were targeting still clears the ceilings. The third test uses the other-debts field. Add the other debts you might realistically take on, a car loan or a renovation loan, and watch whether the back-end ceiling drops below your housing share and starts to bind. A purchase that survives all three tests with room to spare is genuinely robust. One that only works under the most favorable assumptions is a bet that nothing will change, which over the life of a thirty-year loan is a poor bet to make. The point of the exercise is not pessimism but resilience. By choosing a price that still works under a worse rate, a lower income and a heavier debt load, you build the margin that lets you keep the home through whatever the years bring rather than choosing one that depends on perfect conditions.
Closing costs and cash reserves the price tag ignores
The home price this tool produces is the purchase price, the agreed value of the property, and it is easy to mistake it for the total cash a purchase demands. It is not, and the difference can run to a substantial sum that the headline figure says nothing about. Closing costs are the fees that accompany the transaction itself: loan origination charges, appraisal and inspection fees, title work, legal costs, and various government taxes on the transfer. Together they commonly add a meaningful percentage of the price on top of the price, and they are due in cash at completion, separate from and in addition to your down payment. A buyer who saves exactly enough for the deposit and nothing more can find themselves unable to close. Beyond the transaction, prudent ownership calls for cash reserves held back after the purchase. Lenders themselves often want to see several months of payments in reserve, and the logic holds regardless of whether they ask: a new home brings repairs, a roof or a system can fail, and the months after moving in are exactly when a financial cushion is most valuable and most often depleted by furnishing and moving costs. This is why draining every account to maximize the down payment can be a mistake even though a larger deposit raises the price you can reach. The right plan budgets for three distinct pools of cash: the down payment that this calculator adds to your loan, the closing costs that ride on top of the price, and a reserve held in safety after the keys change hands. Sizing all three before you shop keeps the affordable price honest, because a home you can technically buy but cannot close on, or cannot maintain once inside, was never truly affordable in the first place.
Frequently asked questions
How much house can I afford on my income?
As much as fits the lower of two debt-to-income ceilings against your monthly income. On the defaults a 1,200,000 annual income (100,000 a month) gives a 28,000 housing budget, which supports a home of about 4,179,000 on a 600,000 down payment. The classic 28/36 rule of thumb is the starting point, but your real answer shifts with your down payment, rate, other debts and the taxes and insurance on the home. Enter your own numbers and the headline updates to the highest price those inputs can sustain.
What is the difference between the front-end and back-end ratio?
The front-end (housing) ratio is the slice of income going to the home payment alone, defaulting to 28%. The back-end (total-debt) ratio counts that payment plus all your other monthly debts against income, defaulting to 36% and commonly capped at 43%. The tool sizes your budget as the lower of these two ceilings, so whichever bites first controls the result. With no other debts the front-end usually binds; add enough debt and the back-end takes over and pulls your affordable price down even though your income has not changed.
Why does a down payment under 20% add PMI, and how do I avoid it?
Private mortgage insurance protects the lender when you borrow more than 80% of the home's value, so it is charged while your down payment is under 20%. On the defaults the 600,000 down is only 14.4% of the price, so about 1,491 a month of the 28,000 budget goes to PMI instead of toward a bigger loan. You avoid it by reaching 20% down: raising the deposit removes PMI, frees that money for principal and interest, and lifts the price you can afford. The tool re-solves automatically as soon as your equity clears 20%.
Why is the cash I need to buy more than my down payment?
Because closing costs are on top of the deposit. Title fees, loan origination, prepaid taxes and insurance and similar charges typically run a few percent of the price, and the tool adds them to your down payment to show the true cash to close. On the defaults a 600,000 down payment plus about 125,000 of closing costs at 3% means you actually need roughly 725,000 in hand. Budgeting only for the deposit is the most common way buyers come up short at the signing table.
How much does the mortgage rate change what I can afford?
A lot, because your payment budget is fixed and a higher rate buys a smaller loan. On the defaults the same income supports about 4,500,000 at 5%, 4,179,000 at 6%, 3,895,000 at 7% and 3,643,000 at 8% - so a single point from 6% to 7% trims roughly 284,000 off the home you can afford. That is real money lost to one rate point, which is why locking a rate and shopping when rates dip can matter as much as saving a larger deposit. The buying-power-by-rate table makes the sensitivity visible at a glance.
What do the conservative and aggressive figures mean?
They bracket your price as an affordability range. The conservative end re-runs the whole solve at a cautious 25/33 debt-to-income stance, and the aggressive end at a 36/43 stance - the upper edge of what most lenders allow. On the defaults that band runs from about 3,785,000 to about 5,229,000, with your 28/36 target sitting between them. A conservative budget protects you if income dips or costs rise; an aggressive one assumes everything goes right. Aiming nearer the low end leaves room to absorb surprises.
Is the price this gives me what a lender will actually approve?
It is a close estimate of the ceiling, not a guarantee. Lenders also weigh your credit score, employment history, cash reserves and the property itself, and their exact ratio limits vary by loan program. The figure here tells you the price your income, debts and terms can sustain, which is the right starting point. Treat it as the upper bound for a pre-qualification conversation, then expect the lender's pre-approval to refine it with documents and their own rules.