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House Affordability Calculator to Calculate a Realistic Home Price

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House Affordability Calculator

This calculator will calculate the price of the home you may be able to afford based on the amount of cash you have available for a down payment, and on the monthly funds available for making your mortgage payment and for paying the ongoing home ownership costs. The Alert tab includes:

Beware of hidden costs of home ownership.
Ignored ownership costs lead to falling home values.
Income level has little to do with affordability.

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DataData recordData recordSelected data record: None

Down pmt:Down payment:Cash available for down payment:Cash available for down payment:

Cash available for down payment

Monthly cash:Monthly cash:Monthly PI payment and costs:Monthly PI payment and home ownership costs:

Monthly PI payment and home ownership costs

Rate:Interest rate:Annual interest rate:Annual interest rate:

Annual interest rate

Loan years:Loan years:Mortgage term in number of years:Mortgage term in number of years:

Mortgage term in number of years

Property tax:Property tax:Property tax rate:Property tax percentage rate:

Property tax percentage rate

Home price:Home price:Home price:Home price:

Down pmt:Down payment:Down payment:Down payment:

Loan amt:Loan amount:Mortgage loan amount:Mortgage loan amount:

LTV:Loan to value:Loan to value ratio:Loan to value ratio:

House Affordability Breakdown Tap the text for a description of each row result.
Pmt and Own CostsPmt and Own CostsPayment and Ownership CostsPayment and Ownership Costs	MonthlyMonthlyMonthlyMonthly	AnnualAnnualAnnualAnnual
Mortgage PI pmt:Mortgage PI pmt:Mortgage PI payment:Mortgage PI payment:Mortgage PI payment: Mortgage PI payment: Based on your entries, this will be your monthly and annual principal and interest payment.
Utilities:Utilities:Utilities:Utilities:Utilities: Utilities: Based on your entries, this will be your monthly and annual utility costs (1.57% of the home value per year).
Maintenance:Maintenance:Maintenance:Maintenance:Maintenance: Maintenance: Based on your entries, this will be your monthly and annual maintenance costs (.39% of the home value per year).
Insurance:Insurance:Homeowner insurance:Homeowner insurance:Homeowner insurance: Homeowner insurance: Based on your entries, this will be your monthly and annual homeowner insurance costs (.42% of the home value per year).
Property taxes:Property taxes:Property taxes:Property taxes:Property taxes: Property taxes: Based on your entries, this will be your monthly and annual property tax costs.
PMI:PMI:Private mortgage insurance:Private mortgage insurance:Private mortgage insurance: Private mortgage insurance (PMI): Based on the estimated loan to value ratio, this will be your initial monthly and annual private mortgage insurance premium. This premium will decrease as you increase your equity in the home.
Total:Total:Total:Total:Total: Total: Based on your entries, this is monthly and annual total of your payment and home ownership costs for the purchase price of the home the house affordability calculator estimates you can afford.

If you would like to save the current entries to the secure database, tap or click on the Data tab, select "New Data Record", give the data record a name, then tap or click the Save button. To save changes to previously saved entries, simply tap the Save button. Please select and "Clear" any data records you no longer need.

Feedback AppreciatedFeedback Greatly AppreciatedYour Feedback Would Be Greatly AppreciatedYour Feedback Is Greatly Appreciated

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Step #1:

Enter the cash you have available for the down payment on the home.

Step #2:

Enter the monthly cash you have available for the payment and ownership costs.

Step #3:

Enter the annual interest rate of the mortgage.

Step #4:

Enter the term of the loan in number of years.

Step #5:

Tap the "Calculate Affordability" button. This will populate the house affordability breakdown chart and display a pie chart depicting a visual breakdown of the payment and ownership costs.

Saving Entries:

If your web browser supports Local Storage, you can save your entries to your web browser so won't have to start over on your next visit. Please note that your saved entries can only be retrieved from the same device and web browser you were using when you stored them. If you would like to access your saved entries from any device I invite you to subscribe to the Ad-Free Member Version.

To save your entries to your web browser, click or tap the Data tab in the Help and Tools section (mobile: top right of the main screen), select "New Data Record" from the drop-down menu, enter a name for the data record, and then tap or click the Save button.

To load previously saved entries, click or tap the Data tab and select the saved data record from the drop-down menu. You can then save any changes to your entries by simply clicking the Save button while the data record is selected.

To clear a named set of saved entries, click or tap the Data tab, select the saved data record from the drop-down menu, and then tap or click the Clear button.

Numbers and Decimals:

Only numeric characters (0-9 and decimal points) may be entered in numeric fields. Non-numeric characters (dollar signs, percent signs, commas, etc.) may cause calculation errors. If the field includes a grid icon, tapping the icon will open a popup keypad which will include only the characters allowed in the field. If your device keypad does not include a decimal point, use this popup keypad to enter decimal numbers where applicable.

Popup Tool Tips:

Tap the info (i) icons for a further explanation of each entry field (you can click [X] or outside of the pop-up tool tips to close them). A summary of these explanations, along with any additional term explanations, can also be found under the Terms tab.

Disclaimer:

Since I can't test for every possible combination of numbers, please be sure to double-check the results of this calculator yourself before considering them to be valid. If you do discover an issue with the calculated results, please report the issue using the feedback form located below the calculator.

Scrolling & Shrinking:

In order to scroll the calculator vertically you will need to swipe just outside of the calculator's dark-blue border, or use the window's far right-hand scroll bar, whichever is applicable to your device.

If the top section of the calculator becomes to tall for your viewport, tapping in the "Enter a problem..." field should reset the top section to its original height.

Disclaimer:

The Algebra Calculator is the only calculator on the site that I did not create myself. And since I did not create it, I don't have access to the code for fixing any issues you may be experiencing. So if you are having issues with the calculator, please visit the support page at Mathway.com for assistance.

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Calculator Data

Data Record Title

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Click Latest button, copy data to a text-only document, then save to your hard drive.

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Help and Tools

Alert

Beware of the hidden costs of home ownership.

Should you believe a commissioned real estate agent or mortgage broker when they tell you how much house you can afford?

No!

That is, not unless you're on a mission to increase their financial happiness at the expense of yours.

No matter what they tell you, the goal of every real estate agent and mortgage broker is to get you to buy the home that pays them the highest return for their efforts.

And unless these vested sellers happen to be your loving parents or close personal friends, they really could care less if ten years from now you are forced to sell your home at a loss because you couldn't afford to keep up with the mortgage payments and all of the hidden costs of ownership they failed to warn you about.

Income Level Has Nothing To Do With Affordability

No matter what your income level, if your annual non-home related expenses meet or exceed your take-home pay, then you can't afford to purchase and maintain a home.

The only number that matters when determining how much house you can afford is the difference between how much you take home and how much you spend on non-home related expenses.

If you don't know how much that difference is, be sure to visit the personal budgeting calculator to get a realistic affordability number to work with.

Beware of Hidden Costs of Home Ownership

Contrary to what some real estate agents and mortgage brokers will attempt to get you to believe, just because you can afford to make the prescribed monthly principal and interest mortgage payment does not necessarily mean you can afford to purchase and own the house in question.

That's because there are many other costs that come with owning a house that are above and beyond the monthly payment. These include:

Private Mortgage Insurance (PMI)
Property taxes
Homeowner insurance
Utilities
Maintenance costs

Did Your Real Estate Agent Tell You This?

According to an American Housing Survey (AHS) conducted by the Census Bureau in 2003, the average annual cost to maintain and operate a house at that time was $5,464, with 38% of that amount going for taxes, 40% for utilities, 12% for insurance, and 10% for maintenance.

Using the CPI Calculator to adjust for inflation between 2003 and 2018, that $5,464 has likely grown to $7,470. And if you divide that by 12 months ...

That's roughly $622 per month just for home ownership costs.

Personally, I believe the reported maintenance figures are actually lower than they should be based on hearing numerous real estate agents report that most homeowners are failing to properly maintain their homes.

Ignored Ownership Costs Lead to Falling Home Values

In my opinion homeowners failing to properly maintain their homes is a result of purchasing more house than they could afford.

After all, if you buy more house than you can afford, then all of your available funds will be going toward meeting the minimum obligations to keep your house -- leaving little if any funds for home maintenance and repairs.

Of course, if you can't afford to properly maintain the house you are buying, then your house may actually fall in value (depreciate) over time.

Or, even if you are properly maintaining your house, but your neighbors are not, then your house's value might fall in spite of your best efforts -- because now it sits in a run down neighborhood with falling property values.

Ignorance Is Bliss ... For a While

The bottom line is this.

If you buy a home based on what self-serving sellers say you can afford -- without carefully factoring in the home ownership costs -- then sure, you may be able to afford to make the payments for a few years.

However, as the mechanical and material parts of your home begin to wear out and need replacement, you will likely come to regret taking the sellers at their word.

Free Home May Be Too Costly

Due to the ignorance of home ownership costs and wrongfully assuming that their income levels would last forever, turns out that many home buyers couldn't afford their homes even if someone had given it to them for free.

Of course, no one can predict what will happen with your future income.

So what can you do to protect your home from economic downturns besides adding another insurance premium to your budget?

The best way I know of to protect your home from the next time the greedy financial giants decide to fatten themselves up by eating their own children, is to adopt the Grow Slow, Pay As You Go Method of Home Buying.

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House Affordability Calculator to Calculate a Realistic Home Price

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About

Instructions

Step #1:

Step #2:

Step #3:

Step #4:

Step #5:

Saving Entries:

Numbers and Decimals:

Popup Tool Tips:

Disclaimer:

Scrolling & Shrinking:

Disclaimer:

Glossary

Pocket Calculator

Data Management

Favorites

Side Calc Tape

House Affordability Calculator to Calculate a Realistic Home Price

Selected Data Record:

Cash available for down payment:

Monthly PI payment and home ownership costs:

Annual interest rate:

Mortgage term in number of years:

Property tax percentage rate:

Home price:

Down payment:

Mortgage loan amount:

Loan to value ratio:

Mortgage PI payment:

Utilities:

Maintenance:

Homeowner insurance:

Property taxes:

Private mortgage insurance (PMI):

Total:

About

Instructions

Step #1:

Step #2:

Step #3:

Step #4:

Step #5:

Saving Entries:

Numbers and Decimals:

Popup Tool Tips:

Disclaimer:

Scrolling & Shrinking:

Disclaimer:

Glossary

Pocket Calculator

Data Management

Calculator Data:

My Note:

Help and Tools:

Favorites

Adjust Calculator Width:

Show/Hide Popup Keypads:

Stick/Unstick Tools: