How much house can I afford based on my salary?

A common starting rule caps total debt, including the mortgage, at roughly 36% of gross monthly income, though qualified mortgage guidelines allow up to about 43% for some borrowers. On an 85,000 salary with 400 of other debt and a 40,000 deposit, that range spans a home price of roughly 237,900 at 28% up to about 401,700 at 43%, which is why the ratio you choose matters as much as the income itself.

What is a good debt-to-income ratio for a mortgage?

Most conventional lenders look for a back-end ratio, covering the mortgage plus all other debt, at or below 36-38%, while government-backed qualified mortgages generally allow up to 43%. Ratios above that level are still approved in some cases with compensating factors like a large deposit or strong reserves, but they narrow the pool of lenders willing to offer competitive pricing.

Does this calculator include property tax and homeowners insurance?

Yes, but only at the fixed monthly figure you enter yourself; it does not estimate a real tax rate or insurance premium for a specific address. Enter a realistic local figure, since a 300 estimate on a home that actually carries a 500 tax and insurance bill overstates the loan you can really support.

How does a bigger deposit change how much house I can afford?

A larger deposit adds directly to the home price on top of the loan the budget supports, and it can also improve the rate or remove mortgage insurance once it crosses common thresholds like 20% equity in the US. Both effects push the affordable price higher than the deposit amount alone would suggest.

Why does a shorter mortgage term lower the price I can afford?

The same monthly budget buys less loan over 15 years than over 30, because the balance has to be repaid twice as fast. On a 2,250 budget at 6.0%, a 15-year term supports a loan of about 266,600, well below what the same budget would support over 30 years.

Is the debt-to-income limit the same as what a lender will actually approve?

No. This calculator uses whichever ratio you enter as a planning ceiling, while an actual lender weighs credit score, cash reserves, employment history and loan program rules alongside debt-to-income, and can land above or below the figure you tested here.

Mortgage affordability calculator

This calculator works backwards from your income and existing bills to a home price, rather than forwards from a listing price to a payment. It sets a monthly housing budget from a debt-to-income ceiling you choose, subtracts what you already owe and what tax and insurance will cost, then converts what is left into the largest loan that budget can carry at your rate and term.

What debt-to-income ceiling actually limits

Gross monthly income multiplied by your chosen ratio sets the total ceiling for housing plus other debt payments, not the housing payment alone. On 96,000 a year, an 8,000 monthly income and a 36% ceiling cap combined debt at 2,880, so a 550 car payment and 380 of tax and insurance leave 1,950 for principal and interest — the housing payment is squeezed by whatever else you already owe.

Mortgage underwriters in the US commonly reference a 43% back-end ratio as an upper bound for qualified mortgages, with many conventional lenders preferring something closer to 36-38% once other debts are counted. A ratio above roughly 43% is where approval odds fall off sharply for most lenders, even if this calculator will still compute a number above that line if you ask it to.

Treat the output as a ceiling, not a target. A budget that consumes the full ratio you entered leaves no room for a rate rise at renewal, a repair bill, or a second income that later drops to one.

Two borrowers, one income, different limits

Take a 85,000 income, 400 in other monthly debt, a 40,000 deposit, a 6.75% rate over 30 years and 300 for tax and insurance. At a 28% ratio the monthly income of 7,083 supports a housing budget of 1,283, which finances a loan of about 197,900 and a home price of about 237,900 including the deposit.

Keep every other figure the same but raise the ceiling to a 43% back-end ratio and the housing budget jumps to 2,346, financing a loan of about 361,700 and a home price of about 401,700. The only input that changed is the ratio, yet the supportable price rose by roughly 69% — which shows how much of this calculator's answer depends on which ceiling you decide to trust.

Now compare a household earning 120,000 a year with 900 of other debt, an 80,000 deposit, a 15-year term at 6.0% and 450 for tax and insurance, at a 36% ratio. The monthly budget of 2,250 only reaches a loan of about 266,600 over 15 years, for a total price near 346,600, because half the term means every dollar of budget buys less loan than it would over 30 years.

Where the affordability figure stops being reliable

The calculation assumes tax and insurance stay at the fixed monthly figure you enter for the entire term, but property tax reassessments and rising insurance premiums both tend to climb over time, especially in the years right after a purchase resets the assessed value. A budget that fits today can tighten within two or three years even with no change to the mortgage rate itself.

It also assumes the debt-to-income ratio you pick is the one an actual lender will apply. Underwriters weigh credit score, reserves, loan type and local program rules, and can approve a higher ratio for a strong file or cap a weaker one below 36%, so treat the result as a planning estimate before a formal pre-approval, not a guarantee.

The formula has no mechanism for a variable rate. If the loan you eventually take is an adjustable-rate mortgage or a short-term fixed that reverts, this figure only describes the first period; re-run it at a higher assumed rate to see whether the budget still holds after a reset.

Jurisdiction and timing notes

US conforming loans are additionally capped by county-level loan limits set annually by the Federal Housing Finance Agency, so a price this calculator supports may still require a jumbo loan with its own pricing and larger deposit expectations in high-cost counties.

UK affordability assessments work differently: lenders apply an income multiple, commonly around 4 to 4.5 times gross income, combined with a stress test at a rate several points above the offered rate, so the debt-to-income mechanics here are a rough guide rather than a direct match to a UK mortgage in principle.

Deposit percentage also drives pricing thresholds that this calculator does not apply automatically. Crossing 20% equity in the US commonly removes private mortgage insurance, and in the UK moving from a 90% to an 85% or 75% loan-to-value band typically unlocks a materially lower rate, so a slightly larger deposit can improve the affordable price by more than the deposit amount alone suggests.

Frequently asked questions

How much house can I afford based on my salary?: A common starting rule caps total debt, including the mortgage, at roughly 36% of gross monthly income, though qualified mortgage guidelines allow up to about 43% for some borrowers. On an 85,000 salary with 400 of other debt and a 40,000 deposit, that range spans a home price of roughly 237,900 at 28% up to about 401,700 at 43%, which is why the ratio you choose matters as much as the income itself.
What is a good debt-to-income ratio for a mortgage?: Most conventional lenders look for a back-end ratio, covering the mortgage plus all other debt, at or below 36-38%, while government-backed qualified mortgages generally allow up to 43%. Ratios above that level are still approved in some cases with compensating factors like a large deposit or strong reserves, but they narrow the pool of lenders willing to offer competitive pricing.
Does this calculator include property tax and homeowners insurance?: Yes, but only at the fixed monthly figure you enter yourself; it does not estimate a real tax rate or insurance premium for a specific address. Enter a realistic local figure, since a 300 estimate on a home that actually carries a 500 tax and insurance bill overstates the loan you can really support.
How does a bigger deposit change how much house I can afford?: A larger deposit adds directly to the home price on top of the loan the budget supports, and it can also improve the rate or remove mortgage insurance once it crosses common thresholds like 20% equity in the US. Both effects push the affordable price higher than the deposit amount alone would suggest.
Why does a shorter mortgage term lower the price I can afford?: The same monthly budget buys less loan over 15 years than over 30, because the balance has to be repaid twice as fast. On a 2,250 budget at 6.0%, a 15-year term supports a loan of about 266,600, well below what the same budget would support over 30 years.
Is the debt-to-income limit the same as what a lender will actually approve?: No. This calculator uses whichever ratio you enter as a planning ceiling, while an actual lender weighs credit score, cash reserves, employment history and loan program rules alongside debt-to-income, and can land above or below the figure you tested here.

Sources

Consumer Financial Protection Bureau — Qualified Mortgage rule — Describes the 43% debt-to-income threshold used as a general qualified-mortgage ceiling in current CFPB guidance.
Federal Housing Finance Agency — conforming loan limits — Annually updated county-level loan limits that cap conforming mortgage financing in the US (2025 limits published by FHFA).