Home Affordability Calculator

Use the Home Affordability Calculator

Your results

Estimated affordable home price: $0.00
Estimated monthly mortgage payment: $0.00
Estimated total monthly housing cost: $0.00
Debt-to-income ratio: 0.00%

How this calculator works

What it does: Estimate an affordable home price from your income, debts, down payment, mortgage terms, recurring housing costs, and maximum debt-to-income ratio.
Inputs used: The estimate uses annual gross income, monthly debt payments, down payment, mortgage interest rate (%), loan term (years), property tax rate (%), home insurance per year, hoa per month, and maximum debt-to-income ratio (%).
Calculation approach: The calculator applies the relationships defined for the home affordability calculator to those inputs and updates estimated affordable home price, estimated monthly mortgage payment, estimated total monthly housing cost, and debt-to-income ratio.
How to read the result: Treat the result as a scenario based on the values entered. Compare a few reasonable inputs and consider costs, taxes, timing, or risks that the calculator does not include.

How to Use This Calculator

Enter Annual gross income, Monthly debt payments, and Down payment using values that match the scenario you want to evaluate.
Enter Mortgage interest rate (%), Loan term (years), and Property tax rate (%) using values that match the scenario you want to evaluate.
Enter Home insurance per year, HOA per month, and Maximum debt-to-income ratio (%) using values that match the scenario you want to evaluate.
Review the assumptions for the home affordability calculator, especially rates, time periods, and optional amounts.
Select Calculate to update the results, then adjust one input at a time to compare scenarios.

Understanding the Results

Estimated affordable home price: The estimated affordable home price estimated by the Home Affordability Calculator using annual gross income, monthly debt payments, and down payment and the other values entered.
Estimated monthly mortgage payment: The estimated monthly mortgage payment estimated by the Home Affordability Calculator using annual gross income, monthly debt payments, and down payment and the other values entered.
Estimated total monthly housing cost: The estimated total monthly housing cost estimated by the Home Affordability Calculator using annual gross income, monthly debt payments, and down payment and the other values entered.
Debt-to-income ratio: A percentage or comparison measure that summarizes the relationship between the calculator's key values.

Common Mistakes

Comparing only the mortgage payment and rent while overlooking taxes, insurance, maintenance, fees, and transaction costs.
Using the maximum approved amount instead of a payment that fits the full household budget.
Spending all available cash on the purchase and leaving no emergency or repair reserve.
Assuming home appreciation or future refinancing is guaranteed.

Worked Example

Example inputs

Annual gross income: $120,000
Monthly debt payments: $500
Down payment: $80,000
Mortgage interest rate (%): 6.5%
Loan term (years): 30
Property tax rate (%): 1.2%
Home insurance per year: $2,000
HOA per month: $0
Maximum debt-to-income ratio (%): 36%

Example results

Estimated affordable home price: $469,763.42
Estimated monthly mortgage payment: $2,463.57
Estimated total monthly housing cost: $3,100.00
Debt-to-income ratio: 36.00%

For this illustrative scenario, the estimated affordable home price is $469,763.42. Changing any input can materially change the result, so use the example as a walkthrough rather than a guarantee.

Frequently asked questions

How is the affordable home price estimated?

The calculator determines the monthly debt limit from gross income and the selected DTI cap, subtracts existing monthly debts, and searches for the highest home price whose mortgage, property tax, insurance, and HOA fit the remaining budget.

What does debt-to-income ratio mean?

DTI is the percentage of gross monthly income used for recurring debt and housing payments. Lenders use it alongside credit, assets, loan type, and other underwriting factors.

How does a larger down payment affect affordability?

A larger down payment reduces the mortgage principal and monthly principal-and-interest payment, which can support a higher purchase price under the same monthly housing limit.

Are property tax, insurance, and HOA included?

Yes. Property tax is estimated from the home price, while annual insurance and monthly HOA costs are added to the mortgage payment when solving for affordability.

Is this the same as a mortgage preapproval?

No. This is an estimate. A lender may also consider credit history, cash reserves, employment, loan limits, mortgage insurance, closing costs, and program-specific qualification rules.

What does the Home Affordability Calculator calculate?

Estimate an affordable home price from your income, debts, down payment, mortgage terms, recurring housing costs, and maximum debt-to-income ratio. The result is based only on the inputs and assumptions shown on the page.

How should I interpret the estimated affordable home price from the Home Affordability Calculator?

Use it as an estimate for the scenario entered, not as a guarantee or personal recommendation. Test changes to annual gross income, monthly debt payments, and down payment to see which assumptions have the greatest effect.