How Much House Can You Actually Afford in 2026? (The Real Math)
“How much can I borrow?” and “How much can I comfortably afford?” are not the same question. A lender looks at income, debts and credit details. Your own budget must also leave room for savings, repairs, insurance and ordinary life.
Start with income and regular debts
List your gross monthly income and the payments you already make. Include car finance, credit cards, student loans, personal loans and any other commitment that will continue after you buy. A higher income does not automatically create a comfortable budget if existing debt is high.
What the 28 and 36 ratios mean
Many affordability discussions use a housing ratio near 28 percent and a total debt ratio near 36 percent. These are useful starting points, not universal rules. Lenders may use different limits, and a buyer may choose a lower figure because of childcare, travel, irregular income or a goal to save more.
Turn a price into a payment
Use the House Affordability Calculator to explore a price range from income, debts and a deposit. Then put one possible purchase price into the Mortgage Calculator to see the principal and interest payment.
The deposit changes more than the loan size
A larger deposit reduces the amount borrowed, but using every dollar of savings can leave you exposed to moving costs, repairs and emergencies. The Down Payment Calculator helps compare different deposit percentages so you can see the cash requirement before making an offer.
Look at the full cost
Principal and interest are not the only costs of owning a home. Property taxes, insurance, body corporate fees, maintenance and utilities may also matter. Add realistic estimates to your monthly budget before deciding what feels affordable.
Check your debt to income ratio
The Debt to Income Calculator gives you a simple view of existing commitments compared with income. If buying is not the right fit yet, the Rent Affordability Calculator can help you compare a sensible rental budget while you build savings.
Make the decision with room to breathe
A useful affordability number is one you can manage after an unexpected bill, a rate change or a month with higher expenses. Use calculators to test several scenarios, then confirm the final figures with a lender and your own budget.
Worked affordability example
Suppose gross monthly income is $8,000, planned housing costs are $2,200 and other monthly debt payments are $600. Housing costs are 27.5% of gross income, while total debt payments are $2,800, or 35%. This illustrates the ratios; it is not a lender approval or a recommendation to borrow that amount.
Assumptions and limits
Affordability estimates may exclude maintenance, insurance changes, taxes, fees, irregular income and future interest-rate changes. Use conservative figures and keep an emergency reserve. Lender policies differ, and a maximum approval may still be uncomfortable for your household.
Common questions
Should I use gross or net income?
Many published debt ratios use gross income, but your household budget should also be tested against the money that actually reaches your account.
Does a deposit cover every buying cost?
No. Allow for inspections, legal or settlement costs, taxes or transfer charges, insurance, moving expenses and initial repairs where they apply.