Home Affordability Calculator
Determine how much house you can afford.
You can afford a home worth: -
How It Works
Our Home Affordability Calculator helps you estimate the home price you can comfortably afford based on your financial situation. By entering your gross monthly income and total monthly debt payments, the calculator uses the popular 28/36 rule to determine a reasonable home price for you. This rule is a widely used guideline in the mortgage industry to assess a borrower's ability to manage a mortgage.
The 28/36 rule states that your monthly housing expenses (including mortgage principal and interest, property taxes, and homeowners' insurance) should not exceed 28% of your gross monthly income. Additionally, your total debt-to-income ratio (DTI), which includes your housing expenses plus all other monthly debt payments (such as car loans, student loans, and credit card payments), should not exceed 36% of your gross monthly income. Our calculator uses these principles to provide you with a reliable estimate of your home affordability.
Understanding your home affordability is a critical first step in the home-buying journey. It empowers you to set a realistic budget, narrow down your property search, and approach the mortgage application process with confidence. By knowing how much you can afford, you can avoid the financial strain of being house-poor and ensure that you can comfortably enjoy your new home without sacrificing your other financial goals and lifestyle.
Frequently Asked Questions
What is home affordability?
Home affordability refers to the amount of money you can reasonably afford to spend on a home. It takes into account your income, debts, and other financial obligations to determine a manageable mortgage payment.
How is home affordability calculated?
Home affordability is typically calculated using the 28/36 rule. This rule suggests that your monthly housing costs (including mortgage, property taxes, and insurance) should not exceed 28% of your gross monthly income, and your total debt (including housing costs and other debts) should not exceed 36% of your gross monthly income.
Why is it important to calculate home affordability?
Calculating home affordability is a crucial first step in the home-buying process. It helps you set a realistic budget, avoid financial stress, and ensure that you can comfortably manage your mortgage payments without compromising your other financial goals.
Related Tools
SEO Summary
This home affordability calculator is a free tool to help you determine how much house you can afford. It is designed for users in India and around the world who are looking to buy a home. By providing a simple and intuitive interface, we aim to make the process of calculating your home affordability as easy as possible. This tool is part of a larger ecosystem of free online tools provided by Propsell, a digital initiative by Propsell Estate Services LLP.