Home Price Affordability Calculator

September 26th, 2011 by 
PK

The following is a home price affordability calculator. It estimates whether you can handle the payments on a new mortgage based upon current interest rates and your current debts and income.

You can adjust the settings for your down payment and the most the bank will allow as a debt to income ratio. Also, change your income to get an accurate result. We'll automatically fill in Freddie Mac's data for a 30 year mortgage (you can change the term and rate).

Home Price Affordability Calculator

How does the home affordability calculator work?

A synthetic measure of home price affordability is constructed based upon the inputs to the tool. By knowing what you make and what a bank will allow, we can see what price of house you might afford.

Bank Rate reports that 28% is a good debt to income ratio. We have populated the tool with that number. Feel free to change it if you know you can get a different qualification on your mortgage.

Note that the 'affordability' number presented is a measure of house affordability on a certain monthly payment.

This calculation happens to be how many people shop for homes, for better or worse. Your own situation is unique - although these inputs can determine what a bank may offer you it's ultimately your decision.

      

PK

PK started DQYDJ in 2009 to research and discuss finance and investing and help answer financial questions. He's expanded DQYDJ to build visualizations, calculators, and interactive tools.

PK lives in New Hampshire with his wife, kids, and dog.

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