Updated July 2026 · 10-minute read · Reviewed by a CFP® practitioner
How much house can you afford? The answer depends on your salary, debt, down payment, and current interest rates. Here's a complete breakdown of what different income levels can afford in 2026, with real numbers, not guesswork.
Lenders use two ratios to determine how much you can borrow:
Your housing payment (mortgage, taxes, insurance, HOA) should not exceed 28% of your gross monthly income.
Your total debt payments (housing + credit cards, auto loans, student loans) should not exceed 36% of your gross monthly income.
Note: Some lenders allow higher ratios (up to 43-50%) for borrowers with excellent credit and significant reserves, but 28/36 is the conservative standard.
Assumptions: 6.75% interest rate, 30-year fixed, 20% down payment, $200/month debt payments, 1.5% property tax rate, $1,500/year homeowners insurance.
| Annual Salary | Monthly Income | Max Home Price | Down Payment (20%) | Monthly Payment |
|---|---|---|---|---|
| $50,000 | $4,167 | $175,000 | $35,000 | $1,167 |
| $75,000 | $6,250 | $262,500 | $52,500 | $1,750 |
| $100,000 | $8,333 | $350,000 | $70,000 | $2,333 |
| $125,000 | $10,417 | $437,500 | $87,500 | $2,917 |
| $150,000 | $12,500 | $525,000 | $105,000 | $3,500 |
| $200,000 | $16,667 | $700,000 | $140,000 | $4,667 |
What you can afford: $175,000 home
Reality check: With a $50K salary, you'll need to budget carefully. Consider FHA loans (3.5% down) or down payment assistance programs to make homeownership more accessible.
What you can afford: $262,500 home
Reality check: This is a comfortable range for many middle-class families. You can afford a modest home in most mid-sized cities, but you'll struggle in high-cost areas like NYC, SF, or LA.
What you can afford: $350,000 home
Reality check: This is the sweet spot for many dual-income households. You can afford a nice home in most markets, including some suburbs of major cities.
What you can afford: $525,000 home
Reality check: This puts you in the upper-middle class. You can afford a spacious home in most markets, including some high-cost areas (though not NYC or SF proper).
If you have significant debt (student loans, credit cards, auto loans), your affordability decreases. Lenders look at your debt-to-income (DTI) ratio:
Most lenders prefer DTI below 36%, but some allow up to 43-50% for borrowers with excellent credit.
A larger down payment reduces your loan amount and monthly payment, allowing you to afford a more expensive home. However, it also requires more savings upfront.
Higher interest rates reduce your purchasing power. A 1% increase in rates can reduce your affordability by 10-15%.
Property taxes and homeowners insurance vary significantly by location. High-tax states (like New Jersey, Illinois, Texas) reduce your affordability compared to low-tax states.
If you're buying a condo or townhome, HOA fees can add $200-$500+ to your monthly payment. Factor these into your affordability calculation.
A 50-100 point improvement in your credit score can lower your interest rate by 0.25-0.5%, increasing your affordability.
A 30-year mortgage has lower monthly payments than a 15-year mortgage, allowing you to afford a more expensive home. However, you'll pay more interest over time.
If you're flexible on location, you can afford a much larger home in lower-cost areas. Use our state mortgage calculators to compare affordability by state.
Here's what a $100,000 salary gets you in different markets (assuming 20% down, 6.75% rate):
| Market | Median Home Price | Affordable? | Notes |
|---|---|---|---|
| Cleveland, OH | $150,000 | ✅ Yes | Very affordable, can buy a large home |
| Indianapolis, IN | $250,000 | ✅ Yes | Affordable, can buy a nice home |
| Atlanta, GA | $380,000 | ⚠️ Stretch | Tight budget, need to minimize debt |
| Denver, CO | $550,000 | ❌ No | Too expensive for $100K salary |
| Los Angeles, CA | $900,000 | ❌ No | Way too expensive |
| New York, NY | $700,000 | ❌ No | Too expensive, need $150K+ salary |
With a $75,000 salary, you can afford a home priced around $262,500 (assuming 20% down, 6.75% interest rate, and minimal debt). Your monthly payment would be approximately $1,750. If you have significant debt or want a larger down payment, your affordability decreases.
With a $100,000 salary, you can afford a home priced around $350,000 (assuming 20% down, 6.75% interest rate, and minimal debt). Your monthly payment would be approximately $2,333. This is a comfortable range for many dual-income households.
The 28/36 rule is a conservative guideline, but some lenders allow higher ratios (up to 43-50%) for borrowers with excellent credit and significant reserves. However, just because you can borrow more doesn't mean you should. Consider your lifestyle, savings goals, and comfort level with debt.
A larger down payment reduces your loan amount and monthly payment, allowing you to afford a more expensive home. For example, if you put down 10% instead of 20%, you can afford a home that's about 10-15% more expensive, but you'll pay PMI and have a higher monthly payment.
Yes, but your student loan payments reduce your affordability. Lenders include your student loan payment in your debt-to-income (DTI) ratio. If your DTI exceeds 43%, you may have trouble qualifying. Consider paying down your student loans before buying a house, or look for homes in your lower end of your affordability range.
Your salary is the biggest factor in how much house you can afford, but it's not the only one. Your debt, down payment, credit score, and local market conditions all play a role. Use the 28/36 rule as a starting point, then use our affordability calculator to get a more precise estimate based on your specific situation.
Remember: just because you can afford a certain home price doesn't mean you should. Consider your lifestyle, savings goals, and comfort level with debt. It's better to buy a home you can comfortably afford than to stretch your budget and become house-poor.
See exactly how much house you can afford based on your income, debt, and down payment.
Open the Affordability Calculator →