How much mortgage can I afford?

A practical starting point: you can usually afford a mortgage where your total monthly housing cost is about 25%–30% of your gross monthly income, and your total debt payments stay below about 36%–43% of gross income.

Quick estimate:

1. Gross annual income ÷ 12 = gross monthly income
2. Multiply by 0.28 = target monthly housing payment
3. Subtract estimated property taxes, homeowners insurance, HOA dues, and mortgage insurance
4. The remainder is the mortgage principal-and-interest payment you can support

Example: If you earn $100,000/year, gross monthly income is about $8,333. A 28% housing budget is about $2,333/month. If taxes, insurance, HOA, and mortgage insurance total $700/month, then about $1,633/month is left for the actual mortgage payment.

A safer rule: choose the lower of what a lender approves and what still leaves you comfortable after retirement savings, emergency savings, childcare, car costs, healthcare, utilities, and normal spending.

To estimate your price range, you need five numbers: annual household income, monthly debt payments, down payment amount, estimated interest rate, and local taxes/insurance/HOA costs. The interest rate matters a lot, so verify current rates before relying on any purchase-price estimate.