Generally, it is said that you can get houses that are 2 to 2.5 times your yearly gross income.
Hence, if you have more than one source of income, then you can combine the incomes.
Once you’ve combined your income, you can now multiply it by 2 or 2.5 to get a range for a house.
In this article, we will give you information on how much house you can afford based on your earnings.
So, if you have plans of getting a house soon, this article is all you need.
Hence, make sure you read this article to know how much house you can afford based on your income.
With that in mind, let’s forge ahead.
How much house can I afford based on your income?
We’ve done the calculations and have the price ranges of houses based on yearly income.
Having said that here are the prices of houses you can afford based on your yearly income:
| Yearly Income | Range Of Houses You Can Afford |
| $40,000 | $80,000 to $100,000. |
| $50,000 | $100,000 to $125,000. |
| $60,000 | $120,000 to $150,000. |
| $70,000 | $140,000 to $175,000. |
| $80,000 | $160,000 to $200,000. |
| $90,000 | $180,000 to $225,000. |
| $100,000 | $200,000 to $250,000. |
| $120,000 | $240,000 to $300,000. |
| $150,000 | $300,000 to $375,000. |
| $200,000 | $400,000 to $500,000. |
Hence, these are estimated price ranges of houses you can afford based on your yearly income.
How much Mortgage can you afford?
Instead of asking how much house you can afford, you should be asking how much mortgage you can afford.
So now, the questions are how much mortgage payment can you afford with ease? How much will the monthly mortgage payment get you for a house?
Hence, note that the house you can afford does not just depend on your income but on other factors.
Thus, these are some questions to consider before planning to get a house:
- How much down payment do you have?
- How much are taxes for properties in your area?
- If your down payment is small, will you pay Private Mortgage Insurance (PMI)?
- How much is the home insurance on the house?
- Aside from the mortgage payment, how much debt do you have monthly?
These are some crucial questions to consider before getting a house.
Hence, from all that was said in this article you can see that to get a house depends on some factors.
Thus, your monthly mortgage payment plays a major role in the house you can afford.
Also, your down payment and your debt should be the major things to consider before getting a house.
For instance, if you need a house for $200,000 and you make a down payment of 20% your mortgage will be $160,000.
However, if your down payment was just 5%, your mortgage would be $190,000.
Hence, the % difference in the general size of your mortgage can affect the size of your payment.
How Much Mortgage Do You Qualify For?
If you need a mortgage calculator, you can check out Fidelity Bank for a mortgage calculator.
Hence, the calculator will give you an estimate of how much mortgage you’re qualified for. And also the size of your monthly payment.
However, note that this calculator is more effective if you put in the right amount of your down payment.
Thus, when you use this calculator, you may be surprised to see how much house you’re qualified for.
Also, make sure you check what the result means in terms of a monthly mortgage payment.
For instance, if you earn $100,000 yearly and make a down payment of $20,000, you can get a fair mortgage. You can get a mortgage of $260,000 to $280,000 with a 20% down payment.
Hence, with a mortgage of that size, your monthly income should be about $2200 to $2300.
Avoid being “House poor”
One thing you should avoid when looking for a house is to avoid being house poor.
Hence, some realtors and lenders will often tell you that you can get many houses based on your income.
However, at the end of the day, they are not the ones to make the monthly mortgage payment.
Thus, you don’t have to put much income into keeping up with your house payments.
In other words, you don’t have to be “House Poor”, it is a bad situation to find yourself.
Hence, make sure you stick with a choice you are qualified for and also what you can manage.
Conclusion
In conclusion, getting a house you can afford is not just based on your income. Hence, other factors can affect the cost of a property.
Also, ponder on these questions before planning to get a house:
- How much down payment do you have?
- How much are taxes for properties in your area?
- If your down payment is small, will you pay Private Mortgage Insurance (PMI)?
- How much is the home insurance on the house?
- Aside from the mortgage payment, how much debt do you have monthly?
Thus, if you have any questions, let us know in the comment session. Having said that, thank you for reading!