Home Affordability Calculator
Find out how much house you can afford using the 28/36 rule.
Enter income, debts, down payment, and interest rate for a maximum purchase price estimate.
Home affordability is calculated using three overlapping rules that lenders and financial planners use to determine how much house you can responsibly buy.
Rule 1 — The 28/36 Rule:
Max Housing Payment = Gross Monthly Income × 28%
Max Total Debt = Gross Monthly Income × 36%
Your mortgage (principal + interest + taxes + insurance) should not exceed 28% of gross monthly income. All debt combined (mortgage + car + student loans + credit cards) should not exceed 36%.
Rule 2 — Maximum Purchase Price:
Max Home Price ≈ Annual Gross Income × 3 to 4
Conservative buyers use 3×. More aggressive financing allows up to 4–5× in low-rate environments.
Rule 3 — Monthly Payment Formula (amortization):
Monthly Payment = P × [r(1+r)^n] / [(1+r)^n − 1]
Where P = loan amount, r = monthly rate, n = months.
Worked example:
Gross income: $7,500/month. Down payment: $40,000. Interest rate: 6.8%. Term: 30 years.
Max housing payment (28%): $7,500 × 0.28 = $2,100/month
Monthly rate: 6.8% / 12 = 0.567%.
Solving for P with payment = $2,100, n = 360:
P = $2,100 × [(1.00567)^360 − 1] / [0.00567 × (1.00567)^360]
(1.00567)^360 ≈ 7.69 → P ≈ $2,100 × 6.69 / 0.04359 ≈ $322,000
Max home price = $322,000 + $40,000 down = ≈ $362,000
Additional costs to include:
- Property taxes: typically 1–2% of home value per year
- Homeowners insurance: $1,000–$3,000/year
- PMI (if down payment < 20%): 0.5–1.5% of loan per year
How we build and check this calculator
This calculator runs entirely in your browser, so the numbers you enter stay on your device. The math behind it is written by hand and tested against worked examples and standard references before the page goes live.
SuperGlobalCalculator is independently built and maintained. See how we build and verify our calculators.