Roughly $350,000 to $450,000 at today's rates with a normal down payment and little other debt: a $100,000 salary supports a total housing payment of about $2,300 to $2,900 a month under the lenders' 28 to 36 percent rules, and what that buys depends on the rate, the down payment, the property tax and the HOA more than on the salary.
Lenders qualify on payment, not price, so the salary sets a monthly ceiling and everything else decides what that ceiling buys. Two rates, two down payments and two HOA figures can turn the same $100,000 into a $320,000 home or a $480,000 one. Here is the arithmetic, with the numbers people at this income actually face.
The payment ceiling
Gross monthly income at $100,000 a year is $8,333. The conservative rule caps the housing payment (principal, interest, taxes, insurance and HOA) at 28 percent: $2,333. The debt-to-income limit most conventional loans actually apply is 43 to 45 percent of gross for all debts together, so with a $400 car payment and $200 of student loans the housing payment can reach about $3,000 and still qualify; with no other debt, closer to $3,600 on paper, which is more than most people at this income are comfortable paying.
Comfortable is the 28 percent figure. Qualifiable is the 43 percent one. The gap between them is the difference between a house you own and a house that owns you.
What the ceiling buys
Take $2,600 a month as a middle figure. In the Las Vegas valley property tax runs about 0.5 to 0.7 percent of value a year (lower than most of the country), insurance about $1,200 to $2,000 a year, and HOA dues $50 to $300 a month where there is one. At a 6.5 percent rate with 10 percent down, $2,600 covers a home around $380,000: about $2,160 of principal and interest on a $342,000 loan, $200 of tax, $130 of insurance, $110 of HOA. At 5.5 percent the same payment reaches about $420,000. With 20 percent down and no HOA, $450,000 is in range.
Every $100 a month of HOA dues removes about $15,000 of price at these rates. Every half point of rate moves the price about five percent. The down payment moves it a great deal, because it is both a smaller loan and, at 20 percent, no mortgage insurance.
The cash, and the rest of the budget
Price is one constraint and cash is the other. Ten percent down plus three percent closing costs on a $400,000 home is $52,000, and lenders want to see some reserves after it. At this income a three percent down conventional or an FHA loan opens the door sooner, at the cost of mortgage insurance that adds $150 to $300 to the payment.
The payment calculator below runs the full figure for any listing on the site, with the actual tax and HOA for that home rather than an average.
Questions people ask
How much house can I afford with an 80k salary?
About $280,000 to $360,000 on the same arithmetic: gross monthly income of $6,667 supports a housing payment of roughly $1,870 at 28 percent, or more with no other debt. Rate, down payment and HOA move it the same way.
Can I afford a $500,000 house on a 100k salary?
On paper, sometimes: with 20 percent down, no other debt and a low HOA, the payment lands near $3,000, inside the 43 percent debt-to-income limit. It is well above the 28 percent comfort line and leaves little room for a rate rise or a job change.
What income do you need for a $400,000 house?
About $95,000 to $110,000 at current rates with 10 percent down, using the 28 percent rule. Less with a larger down payment or a lower rate; more with an HOA or high property tax.