The answer to "how much house can I afford?" depends on your take-home pay — not your gross salary. Here is how to calculate it accurately using the two most common rules, plus real examples at popular salary levels.
The 28% Rule: Housing Should Be ≤28% of Gross Income
The traditional rule of thumb says your monthly housing payment (mortgage + taxes + insurance) should not exceed 28% of your gross monthly income. But this rule was designed before high state taxes, student loans, and rising insurance costs. A better starting point is 30% of your net monthly take-home pay.
How Much House by Salary (2026, Single Filer, California)
| Salary | Monthly Take-Home (CA) | Max Housing (30%) | Est. Loan (6.5%, 30yr) |
|---|---|---|---|
| $50,000 | $3,421 | $1,026 | ~$162,000 |
| $75,000 | $4,872 | $1,462 | ~$231,000 |
| $100,000 | $6,144 | $1,843 | ~$291,000 |
| $150,000 | $8,640 | $2,592 | ~$409,000 |
| $200,000 | $10,902 | $3,271 | ~$516,000 |
Loan estimate based on 6.5% rate, 30-year term, 20% down payment. Taxes and insurance not included in loan estimate.
State Taxes Change Your Buying Power Significantly
On a $100,000 salary, your monthly take-home is $6,144 in California but $6,616 in Texas — a $472/month difference solely from state income tax. Over a 30-year mortgage, that gap compounds into tens of thousands of dollars in buying power.
The 36% DTI Rule
Lenders use the Debt-to-Income (DTI) ratio to decide how much they'll lend. Most conventional lenders want your total monthly debt payments (housing + car + student loans + credit cards) to stay under 36% of gross monthly income. FHA loans allow up to 43% DTI. The lower your existing debt, the more you can borrow for a home.
See your exact take-home pay by state — and how it affects your buying power.
Calculate Take-Home by State →