What House Can I Afford on My Salary?

Published 2026 - 4 min read

Lenders don't care what you feel you can pay - they use ratios. The standard is 28/36: no more than 28% of your gross monthly income on housing, and no more than 36% once all debts are included. You can apply the same rule yourself before you ever talk to a lender.

A worked example

On a $90,000 salary, gross monthly income is $7,500. Housing at 28% is $2,100 a month. If you also pay $400 a month in car and credit card debt, total-debt math allows $2,300 for housing (36% of $7,500 minus $400), so the 28% figure is the limit that binds: about $2,100.

From payment to price

That $2,100 must cover principal, interest, property tax and insurance - not just the loan payment. At a 6.5% rate with a 20% down payment, a $2,100 total payment supports roughly a $300,000 home. Change the rate or taxes and the number moves a lot.

Why existing debt matters

More car payment means less mortgage. The affordability rule that counts your debts is stricter than the one that ignores them, and it is the one lenders actually use.

Do the math on your numbers

Use the home affordability calculator with debts to find your real ceiling, including property tax and insurance.

Finally, sanity-check the result against your real budget rather than the lender's maximum. A pre-approval letter quotes the top of your range, but a comfortable payment leaves room for maintenance - roughly 1% of the home's value a year - plus utilities, insurance and the life you actually want. Most buyers who stretch to the limit do not regret the house; they regret the monthly squeeze that comes with it.