With no debt, a $275K mortgage will cost $2,402 per month, and you'll need to earn $6,672 per month, or $80,064 per year. With $1,000 monthly debt obligations, a $275K mortgage will have a total of $3,402 monthly debts and you'll need $9,450 per month, or $113,400 per year to afford a $275K mortgage.
The safe conventional way of doing things is to take 1/4 of your monthly income as your mortgage payment. For a 30k/year salary, your monthly payment should be around $625. If your loan is at 4% and you put 20% (like you should), with a 15 year loan, you could get a $105K home.
To comfortably afford a $200,000 house, you'll likely need an annual income between $50,000 to $65,000, depending on your specific financial situation and the terms of your mortgage. Remember, just because you can qualify for a loan doesn't mean you should stretch your budget to the maximum.
With a $65,000 annual salary, you could potentially afford a house priced between $195,000 to $260,000, depending on your financial situation, credit score, and current market conditions. However, this is a broad range, and your specific circumstances will determine where you fall within it.
On a salary of $36,000 per year, you can afford a house priced around $100,000-$110,000 with a monthly payment of just over $1,000. This assumes you have no other debts you're paying off, but also that you haven't been able to save much for a down payment.
A person who makes $50,000 a year might be able to afford a house worth anywhere from $180,000 to nearly $258,000. That's because your annual salary isn't the only variable that determines your home buying budget. You also have to consider your credit score, current debts, mortgage rates, and many other factors.
The Bottom Line. On a $70,000 salary using a 50% DTI, you could potentially afford a house worth between $200,000 to $250,000, depending on your specific financial situation.
A $3,500 per month mortgage in the United States, based on our calculations, will put you in an above-average price range in many cities, or let you at least get a foot in the door in high cost of living areas. That price point is $550,000.
The down payment needed for a $300,000 house can range from 3% to 20% of the purchase price, which means you'd need to save between $9,000 and $60,000. If you get a conventional loan, that is. You'll need $10,500, or 3.5% of the home price, with a FHA loan.
You can get a mortgage with no job but a large deposit if it makes financial sense for you. If you have a good credit history, lenders may be willing to look past your unemployment if you have cash reserves that will help you pay for the loan.
According to HHS's measurement, a family of four in 2023 would be considered impoverished if their income is $30,000 or lower. Alaska and Hawaii use a slightly different measure due to a higher cost of living in those states. The poverty guideline is $37,500 in Alaska and $34,500 in Hawaii.
If you make $3,000 a month ($36,000 a year), your DTI with an FHA loan should be no more than $1,290 ($3,000 x 0.43) — which means you can afford a house with a monthly payment that is no more than $900 ($3,000 x 0.31). FHA loans typically allow for a lower down payment and credit score if certain requirements are met.
According to the 28/36 rule, you should spend no more than 28% of your gross monthly income on housing and no more than 36% on all debts. Housing costs can include: Your monthly mortgage payment. Homeowners Insurance. Private mortgage insurance.
I make $25K a year; can I buy a house? Yes, if you make $25K a year, you can likely afford around $580 per month for a monthly mortgage payment. With a 6% fixed rate and a 3% down payment, this could buy you a house worth about $100,000. However, consult a mortgage lender for exact numbers tailored to your situation.
$1,400 per month qualifies to borrow a loan amount of $204,913; add your $20,000 down payment to this, and you can purchase a home of $224,913. Of course, you'll still need cash for reserves and to cover the loan's closing costs.
The Importance of Interest Rates
When rates are low, you can afford more home. When rates climb, not so much. For example, with a 4% mortgage interest rate, your $2,000 payment could get you a home loan for around $335,000. But if that rate jumps to 6%, the same payment might only stretch to about $270,000.
So if you bring home $5,000 per month (before taxes), your monthly mortgage payment should be no more than $1,400.
When it comes to defining a “good” salary, there's no one magic number. The Bureau of Labor Statistics (BLS) reported that the average salary in the U.S. is $65,470, as of May 2023. Based on this data point, $70K a year is a good salary for a single person — one that puts you above the national average.
The home price you can afford depends on your specific financial situation—your down payment, existing debts, and mortgage rate all play a role. Most experts recommend spending 25% to 36% of your gross monthly income on housing. For a $70,000 salary, that's a mortgage payment between roughly $1,450 and $2,100.
If you make $70,000 a year, your hourly salary would be $33.65.
With a $40,000 annual salary, you could potentially afford a house priced between $100,000 to $140,000, depending on your financial situation, credit score, and current market conditions.
$48,000 is the 25th percentile. Salaries below this are outliers. $90,000 is the 90th percentile. Salaries above this are outliers.
Federal Housing Administration (FHA) loans need at least a 580 FICO Score with at least a 3.5% down payment (which amounts to $10,500 on a $300,000 home). Conventional loans require a minimum FICO® Score of 620 along with a 3% down payment (which amounts to $9,000 on a $300,000 home).