Much House Can I Afford Calculator

Use this How Much House Can I Afford Calculator to estimate the maximum home price and mortgage that may fit your income, down payment, interest rate, monthly debts and housing expenses. Choose Canada or the United States, enter your financial information, and the calculator will estimate your home-buying range along with your mortgage payment, property taxes, insurance, debt ratios and total monthly housing cost.

Mortgage qualification and true household affordability are not always the same thing. A lender may calculate how much you qualify to borrow using gross income and debt ratios, while your personal budget also needs to cover food, transportation, savings, repairs, childcare, utilities and other expenses. This calculator gives you a detailed starting point so you can test different incomes, down payments, mortgage rates and monthly costs before shopping for a home.

How to Use the How Much House Can I Afford Calculator

Start by choosing Canada or the United States. Mortgage qualification works differently in the two countries, so the calculator changes the formulas and default assumptions depending on which country you select.

Next, enter your gross annual household income. Gross income is your income before income tax, payroll deductions and other deductions. If two borrowers will apply together and both incomes will be included by the lender, enter their combined qualifying income.

Enter the cash you plan to use for your down payment. This should generally exclude money you need for closing costs, moving expenses, emergency savings and immediate repairs or renovations.

Enter the mortgage interest rate you expect to receive and choose the mortgage amortization or loan term. A longer repayment period generally lowers the monthly payment for the same principal amount, while a shorter term or amortization requires a larger payment.

Add your recurring monthly debt payments. These may include car loans, student loans, personal loans, lines of credit and credit-card payments. Existing debt matters because lenders compare your total monthly obligations with your gross monthly income.

Simple mode gives you a fast estimate using built-in assumptions. Advanced mode lets you enter your own property tax rate, insurance, heating or utilities, condo or HOA fees, U.S. mortgage insurance and debt-ratio limits.

After calculating, the main result shows an estimated maximum home price. The detailed results also show the estimated mortgage amount, monthly mortgage payment, total housing cost, down-payment percentage and the debt ratios used in the calculation.

Once you have an estimated purchase price, use the Mortgage Calculator to calculate payments and an amortization schedule for a specific mortgage amount.

How Much House Can I Afford?

How much house you can afford depends on much more than your salary. Income is important, but so are your down payment, mortgage interest rate, current debt payments, property taxes, insurance, utilities, condo or HOA fees and the length of the mortgage.

Two households earning exactly the same amount can have very different home-buying budgets. One household may have no consumer debt and $150,000 available for a down payment. Another may have two vehicle payments, student loans and only $30,000 saved. Their incomes might be identical, but their mortgage affordability can be dramatically different.

Interest rates also matter because mortgage qualification is based heavily on the payment required to support a particular mortgage balance. When rates increase, the payment on the same amount of debt rises. That usually reduces the maximum mortgage that fits inside an income-based affordability limit.

A home affordability calculator therefore works backward. Instead of asking what the payment will be on a home you have already chosen, it asks how much payment your income and debts may support and converts that payment into an estimated mortgage and purchase price.

How Home Affordability Is Calculated

The calculator begins with monthly gross household income. Annual income is divided by 12 so it can be compared with monthly housing costs and debt payments.

It then calculates the maximum housing expense allowed by the selected housing ratio and the maximum total debt expense allowed by the selected total debt ratio. Existing monthly debts are subtracted from the total-debt allowance.

Property taxes, heating, insurance and condo or HOA fees consume part of that monthly allowance. The remaining amount can support the mortgage payment.

The calculator then works backward from the mortgage payment to estimate how much mortgage principal can be supported at the selected interest rate and amortization. The available down payment is added to determine an estimated purchase price.

In Canada mode, additional steps are required. The calculator checks the minimum down-payment requirement, estimates mortgage default insurance when applicable and uses the stress-test qualifying rate when that option is turned on.

How Income Affects How Much House You Can Afford

Mortgage qualification normally starts with gross qualifying income rather than take-home income. Gross income is what you earn before taxes and other payroll deductions.

If household income is $120,000 per year, gross monthly income is $10,000. A lender can then compare monthly housing expenses and debt obligations with that $10,000 figure.

Higher qualifying income generally supports a larger mortgage because a larger monthly payment can remain within the same debt-service percentage. If gross monthly income increases from $8,000 to $10,000, a 39% housing ratio increases the theoretical housing-cost allowance from $3,120 to $3,900.

That does not mean every dollar of income will automatically qualify. Salaried income may be straightforward, but lenders can treat overtime, commissions, bonuses, rental income and self-employment income differently. Some forms of variable income may need to be supported by a history of earnings.

The calculator assumes that the income you enter is the gross annual amount that can be used for qualification. If you are unsure how much variable income a lender will accept, calculate several scenarios using conservative and optimistic income amounts.

If you want to compare gross earnings with take-home pay, use the Paycheck Calculator. Qualification may use gross income, but your personal monthly budget needs to work with the money that actually reaches your bank account.

How Your Down Payment Changes Home Affordability

A larger down payment can increase how much house you can afford because it reduces the amount of money you need to borrow. If two people purchase the same $600,000 home but one puts down $40,000 and another puts down $150,000, their mortgage balances will be very different.

A larger down payment can also reduce mortgage-insurance costs. In Canada, a qualifying home purchase with less than 20% down will generally require mortgage default insurance. In the United States, certain mortgages with smaller down payments may require PMI or another form of mortgage insurance.

The size of the down payment also determines the loan-to-value ratio. Loan-to-value compares the mortgage with the property's value. If you borrow $400,000 to purchase a $500,000 home, the base loan-to-value ratio is 80%.

There can be a point where income, rather than the down payment, becomes the limiting factor. Someone with a very large down payment but modest income may still be limited by the monthly mortgage payment and debt-service ratios.

Do not automatically put every dollar of savings into the down payment. New homeowners may also need money for legal fees, inspections, moving, furniture, repairs and emergency savings.

How Mortgage Rates Affect How Much House You Can Afford

Mortgage interest rates have a direct effect on purchasing power. A lower rate means a given mortgage amount requires a smaller payment. A higher rate means the same mortgage requires a larger payment.

Because lenders use monthly payment calculations when measuring affordability, rising interest rates generally reduce the mortgage balance that can be supported by the same income.

This effect can be substantial because mortgages are large debts repaid over many years. Even a one-percentage-point difference in the interest rate can change the payment by hundreds of dollars per month on a large mortgage.

A useful way to plan is to calculate several rate scenarios. Try the rate you expect to receive, then calculate again at a rate 0.5 or 1 percentage point higher. This shows how sensitive your home-buying budget is to changes in financing costs.

If you already know the exact mortgage amount and only want to compare monthly payments, use the Mortgage Estimate Calculator.

How Monthly Debt Payments Reduce Home Affordability

Existing monthly debt payments can have a major effect on the amount of mortgage you can qualify for. Income creates room within a debt ratio, while existing debts consume some of that room before the new mortgage is added.

For example, imagine a household earns $10,000 gross per month. If its total debt limit is 44%, the theoretical maximum for housing and other qualifying debts combined is $4,400 per month. If the household already has $1,200 of monthly debt payments, only $3,200 remains before reaching that limit.

Common debts can include vehicle loans or leases, student loans, personal loans, minimum credit-card payments and lines of credit. Lenders can have specific rules for how each obligation is calculated.

This is why eliminating a large monthly payment can sometimes increase mortgage qualification significantly. Paying off a $700-per-month vehicle loan may free up substantially more monthly qualification room than adding the same amount of cash to a down payment.

How Much House Can I Afford in Canada?

Canadian mortgage affordability commonly relies on two ratios: Gross Debt Service, or GDS, and Total Debt Service, or TDS. Borrowers may also need to qualify using a mortgage rate above the rate they will actually pay.

Canada mode calculates both GDS and TDS. It increases the potential home price until either the housing-expense limit or total-debt limit is reached.

The calculator also applies Canada's minimum down-payment structure. If the available down payment is too small for a particular purchase price, that price will not be treated as affordable even if the income-based calculation would otherwise permit it.

For high-ratio mortgages, the calculator estimates a mortgage-insurance premium and adds it to the mortgage before calculating the payment. This is important because a buyer who puts less than 20% down can have a financed mortgage balance slightly larger than simply purchase price minus down payment.

What Is the GDS Ratio?

GDS stands for Gross Debt Service. It measures the portion of gross household income required to cover qualifying housing expenses.

CMHC's debt-service calculator states that GDS should not exceed 39%. This calculator therefore uses 39% as the default Canadian GDS limit.

Qualifying housing expenses can include the mortgage payment, property taxes, heating and part of applicable condo or association fees.

For example, a household earning $120,000 per year has gross monthly income of $10,000. At a 39% GDS limit, qualifying housing expenses would be limited to approximately $3,900 per month under that assumption.

The mortgage payment does not receive the entire $3,900. Property taxes, heating and eligible condo expenses must also fit inside the same housing allowance.

What Is the TDS Ratio?

TDS stands for Total Debt Service. TDS begins with housing expenses and then adds other qualifying monthly debts.

CMHC currently states that TDS should not exceed 44%, so 44% is the calculator's default Canadian total-debt limit.

If you have little or no outside debt, the GDS limit may determine your maximum mortgage. If you have large car payments, loans or credit-card obligations, TDS may become the tighter constraint.

Consider a household earning $10,000 per month with $1,000 of qualifying non-housing debt. A 44% TDS limit equals $4,400. Subtract the $1,000 debt and approximately $3,400 remains for qualifying housing expenses before the TDS limit is reached.

Canadian Mortgage Stress Test

The Canadian mortgage stress test requires many borrowers to demonstrate that they could afford their mortgage at a rate higher than the mortgage contract rate.

The current minimum qualifying rate for uninsured mortgages at federally regulated lenders is the greater of the mortgage contract rate plus 2 percentage points or 5.25%.

For example, if your contract mortgage rate is 4.5%, adding two percentage points gives 6.5%. Because 6.5% is higher than the 5.25% floor, the calculator uses 6.5% for the qualifying mortgage payment when the Canadian stress-test option is enabled.

If the actual mortgage rate were 3%, the contract rate plus two percentage points would be 5%. The qualifying rate would instead be 5.25% because the floor is higher.

This means the qualifying payment displayed by the calculator may be considerably larger than the actual monthly mortgage payment. The larger qualifying payment is used in GDS and TDS, while the estimated actual monthly payment uses the mortgage rate you entered.

You can review the current qualifying-rate framework directly through the Office of the Superintendent of Financial Institutions.

Minimum Down Payment in Canada

The minimum down payment in Canada depends on the purchase price of the home.

• For a home priced at $500,000 or less, the minimum down payment is generally 5%.
• For a home above $500,000 but below $1.5 million, the minimum is 5% of the first $500,000 plus 10% of the amount above $500,000.
• For a home priced at $1.5 million or more, the minimum down payment is 20%.

Example: $600,000 Home

Five percent of the first $500,000 is $25,000. Ten percent of the remaining $100,000 is $10,000. The minimum down payment is therefore $35,000.

Example: $1,000,000 Home

The first $500,000 requires $25,000. The remaining $500,000 requires another $50,000. That produces a minimum down payment of $75,000.

For the current federal requirements, see the Financial Consumer Agency of Canada down-payment guide.

Mortgage Loan Insurance in Canada

If your down payment is less than 20%, you will typically need mortgage loan insurance when the home and mortgage meet the applicable requirements.

Mortgage default insurance protects the lender rather than the borrower. The premium is normally calculated as a percentage of the insured mortgage and can generally be added to the mortgage principal.

The calculator estimates standard premium rates based on loan-to-value. It uses 2.80% where loan-to-value is above 80% and up to 85%, 3.10% above 85% and up to 90%, and 4.00% above 90% and up to 95%.

The estimated premium is added to the mortgage balance before the monthly payment is calculated. This is why the result contains both a mortgage before insurance and a mortgage used for the payment calculation.

Actual insurance premiums and eligibility may vary with the mortgage product. Provincial sales tax on a mortgage-insurance premium, where applicable, is not included in this estimate.

30-Year Mortgages in Canada

A longer amortization spreads repayment across more monthly payments. This lowers the required payment on the same mortgage balance and can increase the mortgage that fits within a debt-service calculation.

However, a lower monthly payment does not mean the mortgage costs less. Extending repayment generally means interest is charged over a longer period.

Thirty-year insured amortizations are available for eligible first-time home buyers and purchasers of qualifying new builds under the current federal framework. Other mortgage products can have different amortization options.

To compare how a longer amortization changes lifetime borrowing costs, use the Mortgage Interest Paid Over Time Calculator.

How Much House Can I Afford in the United States?

U.S. mortgage affordability also compares housing expenses and existing debts with gross monthly income, but there is no single debt-to-income limit that applies to every mortgage product and every lender.

Conventional loans, FHA mortgages, VA loans and other products can have different qualification requirements. Credit history, cash reserves, down payment and other underwriting factors can also influence approval.

The calculator therefore uses 28% for housing and 36% for total debt as simple planning assumptions rather than claiming they are universal approval limits. Advanced mode lets you change both percentages.

In U.S. mode, qualifying housing costs include the estimated principal and interest payment, property tax, homeowners insurance, HOA fees and any PMI amount entered.

What Is Debt-to-Income Ratio?

Debt-to-income ratio, commonly shortened to DTI, compares monthly debt obligations with gross monthly income.

For example, someone earning $8,000 per month before tax with $3,000 of qualifying monthly debt has a DTI of 37.5%.

A lower DTI means a smaller percentage of income is already committed to debt. A higher DTI means more income is required to service existing obligations.

Because DTI rules depend on the mortgage program and lender, use the U.S. Advanced mode when you know the ratio assumptions associated with a specific loan.

How Much House Can I Afford Based on My Salary?

Many buyers begin with their annual salary because it is the easiest number to identify. However, there is no universal rule stating that every household can afford a home worth exactly three, four or five times its income.

The same salary can support very different home prices depending on interest rates, debt, down payment and property expenses. The examples below show how to think about different income levels without pretending there is one correct purchase price.

How Much House Can I Afford on $50,000 a Year?

An annual household income of $50,000 equals approximately $4,167 of gross income per month. Housing costs need to fit within the applicable debt ratios after accounting for any other monthly debts.

A buyer with no vehicle payment and a larger down payment may be able to purchase substantially more than someone earning the same $50,000 while carrying significant debt.

How Much House Can I Afford on $60,000 a Year?

A $60,000 household income equals $5,000 of gross monthly income. Enter $60,000 in the calculator and then use your actual down payment, debt payments and mortgage rate to obtain a more meaningful estimate than a generic income multiple.

How Much House Can I Afford on $75,000 a Year?

A $75,000 income equals $6,250 per month before tax. The amount available for a mortgage payment depends on how much of the applicable housing and total-debt limits is consumed by taxes, heating, insurance and existing debts.

How Much House Can I Afford on $80,000 a Year?

An $80,000 annual income is approximately $6,667 gross per month. A buyer with a $700 monthly vehicle payment will generally have less mortgage qualification room than a buyer with no other debt, even though both earn $80,000.

How Much House Can I Afford on $100,000 a Year?

A $100,000 annual household income equals approximately $8,333 per month before tax. Instead of multiplying $100,000 by a fixed number, the calculator measures actual mortgage payment capacity using the other financial information you provide.

How Much House Can I Afford on $120,000 a Year?

A $120,000 household income equals $10,000 gross per month. Under a 39% housing-ratio assumption, $3,900 of monthly gross income could theoretically be allocated to qualifying housing costs before considering the separate total-debt limit.

Remember that this $3,900 includes more than the mortgage payment. Taxes, heating and applicable condo costs also consume part of the housing allowance.

How Much House Can I Afford on $150,000 a Year?

A $150,000 household income equals $12,500 gross per month. Higher income can support a larger monthly payment, but the actual home-price estimate will still depend on interest rates, available down payment and debt.

How Much House Can I Afford on $200,000 a Year?

A $200,000 household income is approximately $16,667 gross per month. At higher incomes, available down payment can become particularly important because the calculated purchase price may approach thresholds where mortgage-insurance and minimum-equity rules change.

How Much House Can I Afford on $250,000 a Year?

A $250,000 household income is approximately $20,833 gross per month. Even at this income level, large vehicle payments, student debt, a small down payment or high property taxes can materially reduce the resulting maximum purchase price.

Homeownership Costs Beyond the Mortgage Payment

A mortgage is usually the largest cost of owning a home, but it is not the only one. A home that appears affordable based only on principal and interest can become much more expensive after taxes, insurance, maintenance and utilities are included.

Property Taxes

Property taxes vary by municipality and property. The calculator estimates taxes as a percentage of the home's value because the purchase price is being solved dynamically.

If the property-tax assumption is 1% and the estimated home price is $500,000, estimated annual property tax is $5,000, or about $417 per month.

Home Insurance

Homeowners insurance protects against covered losses and is an ongoing ownership expense. Premiums vary based on the home, location, coverage level, deductible and insurer.

Heating and Utilities

Heating and utility costs vary with climate, home size, insulation, energy source and household usage. Canadian affordability calculations make heating particularly important because it is included in the modeled GDS and TDS housing expenses.

Condo and HOA Fees

A condo or homeowners association fee can add hundreds of dollars to monthly housing costs. Canada mode uses half of the entered condo fee in its modeled debt-service calculation while displaying the entire fee in the estimated real monthly housing cost.

Maintenance

The calculator does not automatically include a maintenance allowance in the mortgage qualification formula, but homeowners should still budget for repairs and replacement costs.

A furnace, roof, appliance, plumbing repair or exterior project can create a large expense that is not reflected in the mortgage payment.

Closing Costs

Closing costs are separate from the down payment. Depending on the location and purchase, costs can include legal fees, title-related expenses, appraisals, inspections, taxes and prepaid adjustments.

If you have $80,000 saved but expect to need $15,000 for closing and moving costs, you may want to enter only $65,000 as your down payment instead of assuming the full $80,000 is available for the purchase price.

How Much You Qualify For vs. How Much You Can Comfortably Afford

A mortgage affordability calculation answers a lending question: approximately how much debt can fit inside the income and debt limits being modeled?

Your personal budget asks a different question: how much housing cost can you comfortably pay every month while still achieving your other financial goals?

A lender's ratio calculation does not know how much you spend on groceries, childcare, fuel, travel, retirement contributions, hobbies, medical expenses, family support or other priorities.

You may therefore qualify for a larger mortgage than you actually want. Buying below the maximum can create additional monthly room for savings, emergencies and lifestyle expenses.

The opposite is also important: an online result showing that a certain price fits the mathematical assumptions does not guarantee that a lender will approve that amount.

Mortgage approval can depend on credit, documentation, the property being purchased, the stability and type of income, the source of the down payment and lender-specific underwriting requirements.

Should I Buy the Maximum House I Can Afford?

The maximum affordability result should be viewed as an upper estimate rather than a spending target.

Try running the calculator at several scenarios and then compare what a mortgage below the maximum would do to your monthly cash flow. A home costing $50,000 or $100,000 less may create a noticeably smaller payment and more flexibility.

Consider whether the payment would still be comfortable if property taxes, utilities, insurance or maintenance expenses increased. Homeownership expenses rarely remain perfectly unchanged for decades.

If you are comparing buying with continuing to rent, use the Rent vs Buy Calculator to compare both choices over time.

How to Increase How Much House You Can Afford

Home affordability is affected by several variables, which means there are several ways the estimate can change. Adjust one variable at a time in the calculator to see which change has the largest effect in your situation.

• Increase your down payment: More cash reduces the amount that needs to be financed.
• Pay down monthly debt: Removing a car loan or other recurring payment can create more room in the total-debt calculation.
• Increase qualifying income: Higher documented gross income increases the income available within the debt ratios.
• Obtain a lower mortgage rate: A lower rate reduces the payment required for the same mortgage principal.
• Choose a longer amortization when appropriate and eligible: A longer repayment period lowers the scheduled monthly payment but usually increases total interest.
• Consider lower property taxes: Property taxes consume part of the monthly housing allowance.
• Consider lower condo or HOA fees: Large recurring fees can noticeably reduce affordability.
• Choose a lower-priced property: You do not have to spend the maximum amount produced by the calculator.

Why Paying Off Debt Can Increase Mortgage Affordability

Paying down debt before applying for a mortgage can improve affordability in two ways. It reduces the amount of debt you owe and may eliminate a recurring monthly payment from the lender's total-debt calculation.

The monthly-payment effect is particularly important. Suppose you have $15,000 remaining on a vehicle loan with a $700 monthly payment. Eliminating that payment can create $700 of additional monthly room before reaching a total-debt limit.

That does not mean you should automatically use money intended for a down payment to pay off every loan. Reducing debt and increasing the down payment can both help, and the better use of cash depends on the size of the payments, interest rates and applicable down-payment rules.

How Property Taxes Change Home Affordability

Property tax is easy to overlook because it is not part of the mortgage itself. However, it is still an unavoidable housing expense and is often included when measuring mortgage affordability.

Two homes with the same purchase price can have different affordability results if their tax bills are substantially different.

For example, a 1% annual property tax on a $600,000 home is $6,000 per year, or $500 per month. A 2% tax rate would double that expense to $1,000 per month.

That extra $500 can reduce the amount of monthly income remaining for mortgage principal and interest.

How Condo Fees Affect Mortgage Affordability

Condo fees are recurring expenses and can have a meaningful effect on affordability. A $700 monthly condo fee can make a condominium with a relatively low purchase price more expensive each month than expected.

Some condo fees cover expenses that a homeowner would otherwise pay separately, such as exterior maintenance or certain utilities. Others cover amenities or reserve-fund contributions. The effect on your personal budget therefore depends on what is included.

Regardless of what the fee pays for, it should not be ignored when comparing properties.

Mortgage Affordability Calculator vs. Mortgage Calculator

A mortgage affordability calculator and a mortgage payment calculator answer opposite questions.

A mortgage calculator starts with a loan amount. You might enter a $500,000 mortgage, a 4.5% rate and a 25-year amortization and ask what the payment will be.

A home affordability calculator starts with income and debts. It asks how much mortgage payment may fit within those limits, then works backward to estimate the mortgage and home price.

Affordability is useful when you are establishing a home-buying budget. A standard mortgage calculator becomes more useful once you start looking at specific homes and mortgage amounts.

How Much Mortgage Can I Afford?

The mortgage amount and home price are not the same thing. Your down payment covers part of the purchase price, while the mortgage finances the remainder.

If a house costs $600,000 and you put down $120,000, the base mortgage is $480,000. If no mortgage-insurance premium is financed, the mortgage begins at approximately that amount.

With an insured mortgage, a default-insurance premium may be added to the mortgage principal. The financed mortgage can therefore be slightly larger than purchase price minus down payment.

How Much House Can I Afford With No Debt?

Having no recurring consumer debt generally increases mortgage borrowing capacity because less income is already committed to loan payments.

However, a debt-free borrower is still limited by housing expenses. Property tax, heating, insurance and condo fees all use part of the monthly housing budget.

In Canada, the GDS limit can become the main constraint even when there is no outside debt. A borrower cannot necessarily use the entire TDS allowance for a mortgage simply because they have no car loans or credit-card debt.

How Much House Can Two Incomes Afford?

If two borrowers apply together and both incomes qualify, add their gross annual incomes and enter the combined amount.

For example, if one borrower earns $80,000 and the other earns $60,000, enter $140,000 of gross household income.

You also need to include the debts of both borrowers. If one has a $600 vehicle payment and the other has a $300 student-loan payment, enter $900 of monthly debt.

Does Credit Score Affect How Much House I Can Afford?

Credit score is not included as a direct input because there is no single formula that converts a credit score into an exact home price.

Credit can still have a major indirect effect. It may influence whether you qualify for a mortgage, which mortgage products are available and the interest rate or pricing you receive.

If your expected credit profile means you are likely to receive a higher interest rate than the best advertised rate, enter the higher realistic rate. This will produce a more useful affordability estimate.

How Closing Costs Affect Your Home-Buying Budget

The calculator treats the down-payment input as money available specifically for the down payment. It does not subtract closing costs automatically.

If you have $100,000 saved but expect to need $20,000 for closing, moving and immediate expenses, using $80,000 as the calculator's down payment may provide a more realistic estimate.

Closing costs vary considerably by location and transaction, so they are better budgeted separately rather than hidden inside a universal assumption.

How Amortization Changes What House You Can Afford

Amortization is the length of time used to repay the mortgage in full according to the payment schedule. A longer amortization spreads the mortgage across more payments.

For the same mortgage balance and interest rate, a 30-year amortization will normally have a smaller required payment than a 25-year or 20-year amortization.

Because mortgage affordability uses monthly payments, a longer amortization can increase the mortgage principal supported by a particular income.

The disadvantage is additional interest. More time in debt generally means more interest payments over the life of the mortgage.

How to Compare Different Home Prices

Do not stop at the maximum home-price result. Once you know the estimated upper limit, compare several lower purchase prices.

If the affordability calculator estimates $700,000, compare the payments on $550,000, $600,000, $650,000 and $700,000 homes.

The difference between those price levels may translate into hundreds of dollars of monthly cash flow and a large difference in interest over time.

If you need to calculate down-payment percentages or compare percentage changes in home prices, use the Percentage Calculator.

Why Your Bank May Give You a Different Number

An online calculator cannot reproduce every underwriting rule used by every bank, credit union, mortgage company or loan program.

A lender may calculate income differently, especially if you earn overtime, bonuses, commissions, rental income or self-employment income.

The lender may also calculate credit-card debt, lines of credit, student loans or vehicle obligations differently from the simple monthly-debt amount entered here.

Once you choose a specific property, the lender may use its actual taxes, heating assumptions and condo fees rather than the general estimates used while you were establishing a budget.

The affordability result is therefore best used for initial planning and comparing scenarios rather than as a guarantee that the exact amount will be approved.

How Much House Can I Afford Calculator FAQ

Final Thoughts

The question “how much house can I afford?” cannot be answered accurately from salary alone. Your home-buying budget is the result of income, down payment, debt, mortgage rates, amortization, taxes, insurance, utilities and other housing expenses working together.

Use Canada mode to estimate affordability using GDS, TDS, current minimum-down-payment rules, mortgage insurance and the mortgage stress test. Use United States mode to model housing and total debt-to-income ratios while adjusting the assumptions to match the mortgage program or lender you are considering.

Once the calculator produces an estimated maximum home price, test several lower purchase prices as well. Comparing the monthly cost at different price levels can be more useful than focusing entirely on the largest mortgage you might qualify to borrow.

The goal is to establish a realistic home-buying range before you move on to individual listings and lender approval. Use the estimate together with your personal monthly budget so the home you choose works not only on a qualification worksheet, but also in everyday life.