How much house can I afford on an $80,000 salary?

With an $80,000 salary, $400/month in existing debts, $40,000 down payment, 6.8% rate, 1.1% property tax, and $1,200/year insurance, the 28/36 rule suggests a home price of roughly $300,000–$330,000. With no other debts, the back-end limit increases and you may qualify for closer to $370,000. These are estimates — lenders evaluate credit score, reserves, and employment history as well.

What is the 28/36 rule for home buying?

The 28/36 rule is a lender guideline: your housing costs (principal, interest, taxes, and insurance — PITI) should not exceed 28% of gross monthly income (front-end DTI), and all monthly debt payments combined should not exceed 36% (back-end DTI). Some lenders allow up to 43–45% back-end DTI with strong compensating factors such as excellent credit or large cash reserves.

How much down payment do I need?

A 20% down payment eliminates PMI (private mortgage insurance), which typically costs 0.5–1% of the loan per year — about $125–$250/month on a $300,000 loan. FHA loans require just 3.5% down (580+ credit score). Conventional loans allow as little as 3% down (620+ credit score) with PMI. VA loans for eligible veterans require 0% down with no PMI.

Does my credit score affect how much I can afford?

Yes, significantly. A score of 760+ qualifies for the best mortgage rates. Dropping from 760 to 680 can raise your rate by 0.5–1.0%, which on a $300,000 loan adds roughly $90–$180/month and $32,000–$65,000 in total interest over 30 years. Before applying for a mortgage, check your credit report and pay down credit card balances to improve your utilization ratio.

What hidden costs should I budget for beyond the mortgage?

Budget for: closing costs (2–5% of the purchase price, paid upfront), home inspection ($300–$500), moving costs ($1,000–$5,000+), repairs and maintenance (1–2% of home value annually), HOA fees if applicable ($100–$800+/month), and utility deposits. An emergency reserve of 3–6 months of housing expenses is also strongly recommended after purchase.

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

On a $100,000 salary with $500/month in existing debts, 20% down, 7% mortgage rate, and typical property taxes and insurance, the 28/36 rule suggests a home price of roughly $380,000–$420,000. With no other debts, the upper range extends to $450,000–$475,000. Each 1% increase in mortgage rate reduces buying power by roughly $35,000–$45,000 on a $400,000 home budget — rate sensitivity is significant.

What is the 28/36 rule for mortgages?

The 28/36 rule is a lender guideline for qualifying borrowers. The "28" means housing costs (PITI — principal, interest, taxes, insurance) should not exceed 28% of gross monthly income. The "36" means total monthly debt obligations (housing plus car loans, student loans, credit card minimums) should not exceed 36%. Many lenders now approve borrowers up to 43–50% back-end DTI with compensating factors, but staying near the 28/36 targets protects your financial flexibility.

How does my credit score affect how much house I can afford?

Your credit score affects your mortgage interest rate, which directly affects how much house you can afford. A borrower with a 760+ score might qualify at 6.75%, while a 680 score might get 7.5% — a 0.75% difference. On a $350,000 loan over 30 years, that gap adds roughly $180/month and $65,000 in total interest. Before applying, check your credit report for errors, pay down revolving debt below 30% utilization, and avoid new credit applications for 6–12 months.

Home Affordability Calculator

Calculates maximum home price based on income, debts, down payment, and the 28/36 DTI rule.

How to Use the Home Affordability Calculator

This home affordability calculator shows the maximum home price you can qualify for. Enter your annual gross income, monthly debt payments (car loans, student loans, credit card minimums), down payment amount, mortgage rate, and loan term. The calculator applies both the 28% front-end DTI rule and the 36% back-end DTI rule to determine your maximum home price, then shows a detailed monthly payment breakdown including estimated property tax and homeowners insurance.

The 28/36 Rule Explained

The 28/36 rule is the standard lender guideline for mortgage qualification. The front-end ratio (28%) means housing costs — principal, interest, property taxes, and insurance (PITI) — should not exceed 28% of your gross monthly income. The back-end ratio (36%) means total monthly debt payments (housing + all other debts) should not exceed 36%.

When these two limits disagree, the lower result is your binding constraint. For example, if you earn $6,000/month: the 28% rule allows $1,680 for housing; if you have $500/month in car and student loan payments, the 36% rule allows only $1,660 for housing ($2,160 total debt limit minus $500). Some conventional and FHA lenders approve up to 43–50% back-end DTI for strong borrowers.

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How Much House Can You Afford by Income?

As a rough guide, many buyers can afford a home priced at 3–5× their annual gross income. At 6.8% interest, $0 in debts, and 20% down, a household earning $80,000/year can typically afford $320,000–$370,000; $100,000/year maps to roughly $400,000–$460,000; $150,000/year maps to $600,000–$700,000. Debts, down payment size, and local property taxes shift these ranges significantly.

Use our mortgage payment calculator to verify that the monthly payment for any specific home price fits your budget, and our closing cost calculator to estimate the upfront cash needed at closing.

Down Payment Strategies and PMI

A 20% down payment avoids PMI and reduces your loan balance — but it is not always the optimal choice. If your savings earn less than your mortgage rate, putting more down saves money. If your savings earn more (e.g., investing in equities), keeping some liquid and paying PMI may make sense financially. PMI is cancelable once equity reaches 20%, so it is a temporary cost.

Down payment assistance programs exist in most states for first-time buyers. Many offer grants of 3–5% of the purchase price or low-interest second mortgages. Check your state housing finance agency for current programs — they can meaningfully reduce the cash needed to close.

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How Interest Rate Changes Your Buying Power

Mortgage rate sensitivity is one of the most important and underappreciated factors in home affordability. A 1% rate increase on a $400,000 home with 20% down ($320,000 loan) adds roughly $190/month to the mortgage payment and $68,000 in total interest over 30 years. In practical terms, rising from 6% to 7% reduces the home price you can afford (at the same monthly payment) by approximately $35,000–$45,000.

The implication: if rates drop by 1% after you buy, refinancing can recapture that buying power — either lowering your payment or allowing you to afford a faster payoff. If rates rise, buyers who locked early have a significant advantage. The mortgage payment calculator lets you model the payment impact of different rates on any home price before committing.

Hidden Homebuying Costs to Budget For

The purchase price is only part of what you will spend. Closing costs typically run 2–5% of the purchase price — on a $350,000 home, that is $7,000–$17,500 due at closing. These include lender fees (origination, underwriting), third-party fees (title search, appraisal, attorney), and prepaid items (homeowner's insurance, property tax escrow, prepaid interest).

Home inspection: $300–$600 — always worth it to uncover major issues
Maintenance reserve: Budget 1–2% of home value per year for repairs
Moving costs: $1,000–$5,000+ depending on distance and volume
Furniture and appliances: Often underestimated by first-time buyers
HOA fees: $100–$800+/month for condos and planned communities

Financial Disclaimer

This calculator is for educational and planning purposes only. Results are estimates based on the 28/36 DTI guideline. Actual mortgage qualification depends on credit score, employment history, asset reserves, loan type, and lender-specific criteria. Property tax and insurance estimates may differ from actual amounts. This tool does not constitute financial, mortgage, or legal advice. Consult a licensed mortgage professional before making home-buying decisions.