How much house you can afford depends on your income, monthly debts, down payment, mortgage rate and local housing costs.
With limited debt, the examples in this guide range from about $190,000 on a $40,000 salary to around $940,000 on a $200,000 salary, but your own number can be meaningfully higher or lower.
Assumptions Used in Our Examples
| Assumption | Value used |
|---|---|
| Mortgage rate | 6.71% |
| Mortgage term | 30-year fixed |
| Default down payment | 10% |
| Total DTI planning limit | 43% |
| Estimated property taxes | 1.1% of home value annually |
| Estimated homeowners insurance | 0.35% of home value annually |
| Last updated | Sept. 3, 2026 |
The 6.71% rate is the national average 30-year fixed mortgage rate reported in Freddie Mac’s Sept. 3, 2026 survey. The 43% DTI figure is a planning assumption, not a universal mortgage limit. Actual underwriting standards vary by lender, loan type and borrower profile.
Key Takeaways
- Income is only the starting point. Two households earning the same salary can have very different home-buying budgets if one has car loans, student debt or a larger down payment.
- Monthly debt can move the answer quickly. Lenders compare your recurring debt obligations with your gross monthly income when evaluating whether a mortgage fits.
- The amount you qualify to borrow does not have to be the amount you spend. Maintenance, savings goals, childcare and other household costs can justify buying below your maximum.
How Do Lenders Decide How Much House You Can Afford?
Lenders generally look at whether your verified income is sufficient to cover the proposed housing payment along with your other recurring debts.
The core calculation is your debt-to-income ratio, or DTI.
DTI is calculated by dividing monthly debt obligations by gross monthly income.
For example, suppose your household earns $8,333 per month before taxes. Your proposed housing payment is $3,000 and you have another $500 in monthly debt payments.
Your total monthly obligations would be $3,500.
That produces a DTI of about 42%.
There is no single DTI cutoff that applies to every mortgage. The Fannie Mae Selling Guide, for example, allows a maximum total DTI of 50% for loans approved through Desktop Underwriter, while manually underwritten loans generally have lower limits.
That is why the 43% figure used in our calculator examples should be treated as a planning assumption rather than a promise of approval.
What Is the Difference Between Front-End and Back-End DTI?
Front-end DTI looks only at the proposed housing expense.
Back-end DTI adds your other qualifying monthly debts.
Front-End vs. Back-End DTI
| Ratio | What it includes | Example |
|---|---|---|
| Front-end | Mortgage principal and interest, property taxes, homeowners insurance, mortgage insurance and applicable housing expenses | $3,000 housing payment ÷ $8,333 gross income = 36% |
| Back-end | Housing payment plus qualifying car loans, student loans, credit card payments and other recurring debts | $3,500 total obligations ÷ $8,333 gross income = 42% |
In practice, the total debt calculation often becomes the more important constraint for a borrower who already has meaningful monthly obligations.
Someone with no car payment and no student loans may have considerably more room for housing than someone earning the same salary with $1,000 a month already committed to debt.
What Affects How Much House You Can Afford the Most?
Four inputs usually have the largest effect on your result.
The Four Biggest Affordability Factors
| Factor | Why it matters | What generally increases buying power |
|---|---|---|
| 1. Income | Your gross qualifying income determines how much monthly payment your finances can support. | Higher stable qualifying income |
| 2. Existing monthly debt | Debt payments use part of the same monthly income available for housing. | Lower recurring debt payments |
| 3. Mortgage rate | A higher rate increases the payment required for the same loan balance. | A lower mortgage rate |
| 4. Down payment | A larger down payment reduces the amount you need to finance and may eliminate mortgage insurance. | More money down |
How Much House Can You Afford Based on Your Salary?
If you know your household income but do not yet know what home price to target, start here.
The estimates below are rounded planning figures from our salary-based affordability series. They assume limited monthly debt and vary somewhat based on down payment and other costs.
Home Affordability by Annual Income
| Annual income | Approximate home price | Detailed affordability guide |
|---|---|---|
| $40,000 | About $190,000 | Affordability on $40k a year |
| $50,000 | About $235,000 | Affordability on $50k a year |
| $60,000 | About $280,000 | Affordability on $60k a year |
| $70,000 | About $330,000 | Affordability on $70k a year |
| $75,000 | About $350,000 | Affordability on $75k a year |
| $80,000 | About $375,000 | Affordability on $80k a year |
| $90,000 | About $420,000 | Affordability on $90k a year |
| $100,000 | About $470,000 | Affordability on $100k a year |
| $120,000 | About $565,000 | Affordability on $120k a year |
| $150,000 | About $705,000 | Affordability on $150k a year |
| $200,000 | About $940,000 | Affordability on $200k a year |
How Much Income Do You Need for a Specific Home Price?
If you already know your target price, the question works in reverse.
A buyer shopping for a $300,000 home needs a different income profile from someone targeting $750,000 or $1.5 million.
Income Needed by Home Price
| Home price | Approximate starting income | Detailed income guide |
|---|---|---|
| $200,000 | About $50,000 | Income for a $200k home |
| $250,000 | About $62,000 | Income for a $250k home |
| $300,000 | About $75,000 | Income for a $300k home |
| $350,000 | About $87,000 | Income for a $350k home |
| $400,000 | About $100,000 | Income for a $400k home |
| $450,000 | About $112,000 | Income for a $450k home |
| $500,000 | About $125,000 | Income for a $500k home |
| $600,000 | About $150,000 | Income for a $600k home |
| $650,000 | About $162,000 | Income for a $650k home |
| $750,000 | About $175,000+ | Income for a $750k home |
| $800,000 | About $200,000 | Income for an $800k home |
| $900,000 | About $225,000 | Income for a $900k home |
| $1 million | About $250,000+ | Income for a $1 million home |
| $1.5 million | About $375,000 | Income for a $1.5M home |
| $2 million | About $500,000 | Income for a $2M home |
What Does Your Home-Buying Budget Actually Buy?
Qualification tells you what your finances may support.
It does not tell you what that amount buys where you live.
A $300,000 budget can put you above the recent median sale price in one market and below it in another.
The guides below compare specific budgets with recent Movoto market data.
See What Your Budget Buys
| Budget | Market comparison |
|---|---|
| $200,000 | What $200k buys |
| $250,000 | What $250k buys |
| $300,000 | What $300k buys |
| $400,000 | What $400k buys |
| $500,000 | What $500k buys |
| $600,000 | What $600k buys |
| $750,000 | What $750k buys |
| $1 million | What $1 million buys |
How Much Does Your Down Payment Change Affordability?
A larger down payment lowers the mortgage balance and therefore the monthly principal and interest payment.
It can also affect mortgage insurance.
According to the Consumer Financial Protection Bureau, down-payment requirements depend on the loan and lender. You do not universally need 20% down.
On a conventional mortgage, putting less than 20% down commonly means paying private mortgage insurance. The CFPB notes that PMI increases the cost of the loan but can allow borrowers to buy without waiting until they have 20% saved.
Our guide to how much down payment you need for a house compares the tradeoffs directly.
Some eligible buyers can purchase with no down payment at all. The options and limitations are covered separately in our guide to buying a home with no down payment.
How Does Your Credit Affect How Much House You Can Afford?
Credit can affect the mortgage rate and financing terms available to you.
That means two buyers with identical income, debt and down payment could receive different mortgage offers.
A higher rate increases the monthly payment on the same loan balance, reducing the home price that fits within the same budget.
If you are still preparing to buy, see what credit score you may need to buy a house and how long it can take to get your credit ready.
What Costs Does an Affordability Calculator Leave Out?
A calculator is a starting point, not a complete homeownership budget.
Depending on the calculator and the information you enter, the result may not fully account for:
- HOA dues
- Closing costs
- Moving expenses
- Immediate repairs or renovations
- Ongoing maintenance
- Changes in property taxes
- Future increases in homeowners insurance
- The timing of PMI removal
If you already have a specific property in mind, our guide to using a mortgage calculator with taxes and insurance explains where to find the inputs needed for a more property-specific estimate.
A 30-year vs. 15-year mortgage calculator can also show how changing the loan term affects the monthly payment and total interest.
Should You Spend the Maximum a Lender Says You Can Afford?
Not necessarily.
A lender is determining whether a loan fits its underwriting rules.
You are deciding whether the payment fits your life.
Those are related questions, but they are not identical.
Expenses such as childcare, retirement contributions, travel, medical costs, home maintenance and other financial goals may not receive the same weight in a mortgage qualification calculation.
Our guide to borrowing the maximum mortgage you qualify for goes deeper into that distinction.
Before shopping, it can also help to review what you need to buy a house, including cash, credit and documentation.
Once you are ready to move forward, the homebuyer checklist covers the broader purchase process.
Bottom Line
There is no single income multiplier or mortgage rule that tells every buyer how much house they can afford.
Your result comes from the interaction between income, debt, mortgage rate, down payment, taxes, insurance and the financing available to you.
Use the calculator at the top of this page to estimate your own budget. Then use the salary, purchase-price and market tables to move from a rough affordability number to a realistic home search.
The number a lender may approve is your financing ceiling. Your actual home-buying budget should also leave room for the rest of your financial life.
FAQ
How much house can I afford based on my salary?
There is no universal salary multiplier. Under the assumptions used in Movoto’s current affordability examples, buyers with limited debt often land around the mid-four-times-income range, but debt, down payment, mortgage rate, taxes and insurance can move the result substantially.
How much house can I afford if I make $100,000 a year?
About $470,000 is a useful starting estimate in our salary series with limited recurring debt. A larger down payment can increase your buying power, while car loans, student loans and other monthly debts can reduce it.
Does a 20% down payment mean I can afford more house?
Usually, all else being equal. A larger down payment reduces the mortgage balance and can eliminate PMI on a conventional loan. The tradeoff is that you need substantially more cash upfront.
What debt-to-income ratio do you need to buy a house?
There is no single DTI limit for every mortgage. Different lenders and loan programs use different standards. For example, Fannie Mae allows total DTI up to 50% for some loans approved through Desktop Underwriter, while manually underwritten loans generally use lower limits.
Does rent count toward DTI when buying a house?
Your current rent is generally not added on top of the proposed mortgage payment when calculating the DTI for the new home. The lender instead evaluates the housing expense associated with the property you are financing along with your other qualifying debts.
What monthly debts affect how much house I can afford?
Recurring obligations such as auto loans, student loans, credit card minimum payments and other qualifying debts can reduce the amount of income available to support a mortgage. The exact treatment of an obligation depends on the underwriting rules that apply to your loan.
