How Much House Can I Afford? A Practical Way to Think About It

By David Parks · eXp Realty · The Apollo Group · 2 min read

The Short Answer

Lenders look at your income, debts, credit, and down payment to set a maximum. A better question is what monthly payment feels comfortable once taxes, insurance, and maintenance are included.

How Much House Can I Afford? A Practical Way to Think About It
Stock photo: Pexels

What lenders use

Lenders consider your debt-to-income ratio, which compares monthly debts to gross monthly income. A common upper limit for conventional loans is in the mid-40 percent range, though it varies by loan type and lender.

Chart showing what goes into a monthly home payment
Illustration by David Parks. Simplified and not to scale.

What your payment includes

Quick Poll

Where are you in the buying process?

Don’t forget other costs

Utilities, maintenance, commuting, childcare, and savings goals all affect what fits. A planning guide is to budget about one percent of the home’s value each year for repairs.

Try it yourself

Use the mortgage calculator to test different prices and down payments. Then talk with a lender about pre-approval so you have exact numbers.

Tip

Being pre-approved for more than you want to spend is fine. Choose a payment you can sustain through life’s changes.

Key Takeaways
  • What lenders use: Lenders consider your debt-to-income ratio, which compares monthly debts to gross monthly income.
  • Don’t forget other costs: Utilities, maintenance, commuting, childcare, and savings goals all affect what fits.
  • Try it yourself: Use the mortgage calculator to test different prices and down payments.
  • Tip: Being pre-approved for more than you want to spend is fine.

This article is general information, not legal, tax, financial or inspection advice. Every home and situation is different, so confirm details with a licensed inspector, lender, attorney or tax professional.

David Parks
About David Parks

David is a Greater Denver real estate advisor with eXp Realty and The Apollo Group (Colorado broker license FA100103211). He has closed more than $55 million in volume, earned eXp Icon status in 2025, and holds a 5.0 rating on Zillow from 27 verified reviews.

Contact David   Free Home Valuation

Stay In The Loop

Subscribe to David's Newsletter

Denver market updates, new listings, and local tips — no spam, unsubscribe anytime.