House Affordability Calculator
Find the house price you can afford using lender debt-to-income rules.
Please note: Estimates only, not investment or legal advice. Property markets, taxes, fees and lending rules vary by location and change over time. Verify figures with a qualified professional before committing.
What the House Affordability Calculator does
Lenders cap borrowing with two ratios: housing costs against gross income, and all debt payments against gross income. Whichever allows less becomes the binding constraint, and the affordable loan follows by inverting the mortgage payment formula.
Formula
Housing allowance = min(Income × Front-end ratio, Income × Back-end ratio − Existing debts)Available for P&I = Housing allowance − Tax and insuranceMax loan = P&I × ((1 + r)ⁿ − 1) ÷ (r × (1 + r)ⁿ)Max price = Max loan + Down payment
Inputs explained
| Input | Unit | Required | Notes |
|---|---|---|---|
| Gross annual income | selected currency | Yes | Accepts more than 0. |
| Existing monthly debt payments | selected currency | Optional | Car loans, student loans, card minimums. Accepts 0 or more. |
| Down payment available | selected currency | Yes | Accepts 0 or more. |
| Mortgage interest rate | % | Yes | — |
| Loan term | years | Yes | Accepts 1 or more. |
| Housing ratio limit | % | Yes | Maximum housing cost as a share of gross income. |
| Total debt ratio limit | % | Yes | — |
| Annual property tax | selected currency | Optional | Accepts 0 or more. |
| Annual home insurance | selected currency | Optional | Accepts 0 or more. |
| Currency | one of 10 options | Optional | — |
How to use it
- Choose Currency.
- Enter Gross annual income, Down payment available, Mortgage interest rate and Loan term and 2 more.
- Optionally add Existing monthly debt payments, Annual property tax and Annual home insurance.
- Select Calculate.
Worked example
$95,000 income, $450 existing debts, $60,000 down, 6.5% over 30 years, $4,000 tax, $1,400 insurance.
- Income
- 95000
- Debts
- 450
- Down
- 60000
- Rate
- 6.5
- Tax
- 4000
- Insurance
- 1400
Housing budget $2,217 (total debt ratio binds), less $450 escrow leaves $1,767 for P&I — a $279,600 loan and about $339,600 price.
Frequently asked questions
Should I borrow the maximum I qualify for?
Rarely. Lender limits are set by their risk appetite, not your life. Leaving room for maintenance, savings and income disruption matters more than maximising the purchase.
Why does my existing debt reduce affordability so much?
A $450 monthly car payment consumes $450 of your total debt allowance directly. Clearing a loan before applying can raise your borrowing power substantially.