Home Affordability Calculator
Estimate the home price and loan amount your income, debts, down payment and a debt-to-income budget you set can support.
How to Use
- Enter your gross annual income (before tax) and any existing monthly debt payments — car loans, student loans, credit card minimums, and so on.
- Enter the down payment you plan to make, the interest rate and loan term you're estimating with, and a maximum debt-to-income ratio you're comfortable budgeting to (see the DTI Calculator if you're not sure what's realistic for your situation).
- Add monthly property tax + insurance and HOA fees if you have estimates — leave them at $0 if you don't, and the full DTI budget goes toward principal + interest instead.
- The result shows the maximum affordable home price and loan amount this budget supports, plus the maximum principal + interest and total housing payment behind it.
Formula
- Monthly income
- monthly_income = annual_income ÷ 12
- Max total monthly debt
- max_total_debt = max_dti_percent ÷ 100 × monthly_income
- Max housing payment
- max_housing_payment = max_total_debt − existing_monthly_debts
- Max principal + interest
- max_pi = max_housing_payment − taxes/insurance − HOA
- Max loan amount
- max_loan = max_pi × (1 − (1 + monthly_rate)^−months) ÷ monthly_rate
- Max home price
- max_home_price = max_loan + down_payment
Worked Example
$90,000 annual income, $400 in existing monthly debts, $40,000 down payment, 6.5% rate, 30-year term, budgeting to a 36% maximum DTI, with $300 taxes/insurance and $100 HOA estimated.
- Monthly income: $90,000 ÷ 12 = $7,500
- Max total monthly debt: 36% × $7,500 = $2,700
- Max housing payment: $2,700 − $400 = $2,300
- Max principal + interest: $2,300 − $300 − $100 = $1,900
- Monthly rate: 6.5 ÷ 100 ÷ 12 ≈ 0.005417
- Max loan: $1,900 × (1 − 1.005417⁻³⁶⁰) ÷ 0.005417 ≈ $300,600.56
- Max home price: $300,600.56 + $40,000 = $340,600.56
Result: Estimated maximum home price: $340,600.56 / Estimated maximum loan amount: $300,600.56 / Maximum monthly principal + interest: $1,900.00 / Total maximum monthly housing payment (P&I + taxes/insurance + HOA): $2,300.00
About This Tool
What this tool does
This calculator works backward from your income, existing debts, down payment and a debt-to-income (DTI) budget you choose to estimate the maximum home price and loan amount that budget can support.
When to use it
Use it early in a home search to set a realistic price range before you start browsing listings or talking to a lender, or to see how a bigger down payment, a lower rate, or a different DTI target changes what you could budget for.
What the result means
The maximum loan amount is the largest loan your chosen monthly principal + interest budget can fully amortize at the rate and term you entered. The maximum home price adds your down payment back on top of that loan amount.
Assumptions & limitations
The maximum DTI percentage is a budget YOU set, not a number this calculator assumes or recommends — actual qualifying DTI thresholds vary by lender, loan program, your credit profile, and other factors, and are not fixed by regulation (see the DTI Calculator's own assumptions for more on this). This estimate is not a pre-qualification, pre-approval, or lending decision of any kind, and does not imply any lender would actually approve this amount — always confirm real affordability and approval with an actual lender. Property tax, insurance, and HOA are entered as flat monthly dollar amounts you estimate yourself, since expressing them as a percentage of the home price this calculator is solving for would be circular; if you leave them at $0, the full DTI budget goes toward principal + interest instead, which will overstate what you can actually afford once those costs are real.