How much house can I afford on my salary?

Rule of thumb: a total budget of 4–5× annual gross income for typical rates and tenures, assuming standard down payments and modest existing debt. Precisely: your spare DTI capacity converts to a max EMI, which converts to a loan at today's rate — this calculator does the conversion exactly.

What is the 28/36 rule?

A classic US guideline: housing costs ≤28% of gross monthly income, total debt payments ≤36%. It predates 50-year highs in prices, but as a conservatism anchor it still serves — budgets that respect it rarely become house-poor.

Is the lender's approved amount the amount I should spend?

No. Approval limits (~50% FOIR / 43–50% DTI) are the lender's risk ceiling, not your comfort level. Spending 10–20% under the approval preserves savings rate, absorbs rate resets and keeps life funded. The best budget is the one that survives a bad year.

How much down payment do I need?

India: RBI LTV caps require 10–25% of property value, plus 5–8% stamp/registration and interiors — practically 20–30% of the deal in own funds. US: 3–20% down by program, plus 2–5% closing costs; under 20% adds PMI.

How do interest rates change what I can afford?

Roughly 7–8% of buying power per 1% of rate on 20-year tenures. The same ₹50,000 EMI supports ₹62 lakh at 7.5% but only ₹50 lakh at 10.5% — rate negotiation and timing are budget levers, not details.

Should I use gross or net income?

Match the convention: US-style DTI thresholds assume gross income; Indian FOIR norms assume net (in-hand). Using gross against FOIR limits overstates your budget by 20–30% — the most common affordability error in India.

How does existing debt affect my budget?

Every rupee of existing EMI subtracts one-for-one from the EMI available for housing. A ₹15,000 car EMI costs about ₹17 lakh of home budget at current rates — often worth clearing before house hunting.

What tenure should I choose?

The shortest that keeps the EMI comfortable — usually 15–20 years. Longer tenures raise the approved amount but balloon interest: 25 years vs 20 adds ~30% more total interest for ~7% more buying power.

Do I need to keep savings after buying?

Non-negotiable: 6 months of expenses plus EMIs, kept liquid and excluded from the down payment. Homes generate surprise costs immediately — possession delays, interiors overruns, repairs — and the emergency fund is what keeps them surprises rather than crises.

How do bonuses and variable pay count?

Lenders typically average variable income over 1–2 years and may haircut it. For your own planning, build the base budget on fixed income and treat variable pay as prepayment fuel, not EMI capacity.

What about buying with a co-applicant?

A co-applicant's income adds to capacity (and their debts subtract), often lifting budgets 40–80%. Both credit profiles matter, and both are fully liable. Ensure the budget still works if one income pauses — parental leave, job change, health.

Is it better to buy a cheaper home first?

Frequently, yes: transaction costs punish upgrading too often, but starter homes bought within comfortable ratios build equity and credit while preserving investing capacity. The 'stretch now, grow into it' strategy assumes income growth that isn't guaranteed and rate stability that doesn't exist.

How does this differ from loan eligibility?

Eligibility is the lender's maximum loan from their FOIR/DTI caps. Affordability adds your down payment, subtracts transaction costs, and — used well — applies your own stricter comfort cap. Run both; buy at the lower answer.

Should I wait to save a bigger down payment?

Compare the trade: a bigger down payment cuts the loan and may improve LTV pricing, but prices and rents move while you wait. If your ratios are comfortable and the emergency fund is intact, adequate today usually beats perfect later; if you're stretching, waiting is the cheaper choice.

What single check prevents becoming house-poor?

Re-run the EMI at +2% rate and confirm total obligations stay under ~45% of net income with savings still happening. If that fails, the correct price is lower — no matter what the approval letter says.

Home Affordability Calculator – How Much House Can I Buy?

Complete guide

Reviewed July 2026

"How much house can I afford?" has two very different answers: the maximum a lender will approve, and the amount you can carry while still saving, traveling and absorbing surprises. Lenders answer the first; this calculator helps you answer both — because the gap between them is where house-poor households are made.

The mechanics: your income and existing debts set a maximum monthly payment (via DTI limits), that payment converts into a maximum loan at today's rates, and your down payment tops it up to a purchase price. Every input shifts the answer, and rates shift it most.

Enter your income, existing EMIs/debts, rate, tenure and down payment above for your number — then read below for what the lender math hides.

The affordability math

Max monthly payment = Income × DTI cap − existing debt payments

Max loan = Payment × ((1+r)^n − 1) ÷ (r × (1+r)^n)   (inverse EMI formula)

Max price = Max loan + down payment − closing costs

US convention caps DTI around 36–43% of gross income (the 28/36 rule: ≤28% housing, ≤36% total debt). Indian lenders cap FOIR at ~40–55% of net income. Same skeleton, different conventions — this calculator's sliders let you apply either.

Worked example

Household: ₹1,50,000 net monthly income, ₹15,000 existing car EMI, ₹25 lakh saved.
At a 45% FOIR cap: max total EMIs = ₹67,500 → available for home loan: ₹52,500.
At 8.75% for 20 years, ₹52,500/month supports a loan of ≈ ₹59.4 lakh.
Down payment ₹25 lakh minus ~₹5 lakh for stamp duty/registration/interiors = ₹20 lakh usable.
Maximum realistic budget ≈ ₹79 lakh — not the ₹95 lakh a 55% FOIR stretch would suggest.

What income buys at different rates

Each 1% of rate moves buying power roughly 7–8%. This is why affordability calculators must be re-run whenever rates move, and why a rate negotiation is equivalent to a lakhs-larger budget.

Loan supported by ₹50,000/month EMI, 20-year tenure
Rate	Loan amount	Change vs 8.5%
7.5%	₹62.1 lakh	+₹4.5 lakh
8.5%	₹57.6 lakh	—
9.5%	₹53.6 lakh	−₹4.0 lakh
10.5%	₹50.1 lakh	−₹7.5 lakh

Lender maximum vs livable maximum

Lenders approve to ~50%+ FOIR; comfort lives near 35–40%. The difference on ₹1.5 lakh income is about ₹15,000/month of breathing room.
Stress-test at +2%: floating rates reset. If the EMI at +2% breaks your budget, the price is too high today.
Count the full cost of ownership: maintenance/society charges, property tax and repairs add ~1–2% of home value annually beyond the EMI.
Keep the emergency fund out of the down payment: 6 months of expenses+EMI stays untouched, or the first crisis becomes a default risk.
Single-income households and variable earners should build the budget on the stable income only.

A useful discipline: buy at the price where the EMI equals what you already save + pay in rent today. If you can't currently set aside the future EMI each month, the house will teach you that lesson expensively.

Hidden costs that shrink the budget

Stamp duty & registration: 5–8% of price by state, not financeable.
Brokerage (1–2%), legal checks, loan processing fees (0.25–1%).
Interiors and furnishing: commonly 5–10% of price for new flats.
GST (5%) on under-construction property.
Parking, club membership and 'development charges' builders add late.

Using this calculator

Enter monthly income (net for Indian FOIR norms, gross for US-style DTI) and all existing loan payments.
Set the rate you're actually quoted, tenure (prefer ≤20 years), and the DTI/FOIR cap you're comfortable with — try 40% before 50%.
Enter your down payment after subtracting transaction costs and the protected emergency fund.
Read the maximum loan and price; then re-run at rate +2% and choose the smaller number.

Frequently asked questions

Glossary

Affordability: The purchase price your income, debts, savings and comfort thresholds jointly support.
28/36 rule: Housing ≤28% and total debt ≤36% of gross income — the classic conservative guideline.
FOIR / DTI: The share of income committed to obligations; the lender's core capacity metric.
LTV: Loan-to-value — the financed share of the property; capped by regulation and pricing tiers.
Down payment: Your own funds toward the price; excludes stamp duty and fees, which are extra.
Stress test: Re-checking the budget at a higher rate (+2%) to survive floating-rate resets.
House-poor: Owning a home whose costs crowd out saving, investing and living.
PMI: US private mortgage insurance charged below 20% down — a cost, not a benefit to you.

Key takeaways

Affordability = spare debt capacity → max EMI → max loan at today's rate → plus down payment, minus transaction costs. Lenders will approve more than is good for you: cap yourself near 40% of net income, stress-test at +2%, protect the emergency fund, and count the 7–10% of hidden costs. The right house price is the one that leaves your savings rate alive.

Enter your income, debts and savings above — then re-run at rate +2% and let the smaller number set your house-hunting ceiling.

Home Affordability Calculator

Enter your details

Complete guide

The affordability math

Worked example

What income buys at different rates

Lender maximum vs livable maximum

Hidden costs that shrink the budget

Using this calculator

Frequently asked questions

Glossary

Key takeaways

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