How much house can I afford with a $100k salary? Homebuyer options

If you earn $100,000 a year, you may be in a solid position to buy a home and manage the mortgage comfortably. But income alone doesn’t tell the whole story. Your existing debts, the loan type you choose, and the monthly payment you're comfortable with all shape what “affordable” really means.

Read on to see how these factors influence buying power and how much house you can afford with a $100k salary. 

How much house you can afford with a $100k salary

On a $100,000 salary, you could typically afford a home in the $350,000–400,000 range, though the exact number depends on a few factors. Actual affordability depends on elements like location, debt-to-income ratio (DTI), and credit score. 

In this example, we used a $50,000 down payment and about $500 in monthly debts before the mortgage. The loan term was 30 years with a DTI of 35%. 

To test it for yourself, try Better’s affordability calculator and mortgage calculator to see your monthly payments at different home values. Running a few scenarios helps you see the range that feels right instead of locking into one number. 

House budgeting rules

A simple way to set your budget is to follow the 28/36 rule. It suggests capping housing costs at 28% of gross income and keeping total debts under 36%. On a $100,000 salary, that works out to a monthly mortgage payment of about $2,333 or less. 

Following these limits shapes a realistic house budget for a $100k salary while leaving room for savings and everyday expenses. 

The main factors that determine home affordability

A $100,000 salary might look solid, but it doesn’t define your budget on its own. What you can really spend comes down to a few other factors that lenders look at.

Credit score

Better credit means lower interest rates and cheaper monthly payments. Even a difference of 50–100 points on your credit report can affect how affordable a home feels. Scores in the mid-to-high 600s and above count as good. Boosting your credit score often comes from habits like making on-time payments and paying down balances.

Down payment

The more you put down, the less you borrow. The average down payment is 18%, but some loans allow as little as 3%. If you put down less than 20%, though, you’ll also pay private mortgage insurance (PMI), which protects the lender if you fall behind on payments. Once you build 20% equity in your home, you can ask to have PMI removed.

DTI ratio

Lenders also check your DTI ratio, which shows what share of your income goes to debts like car loans and credit cards. The lower your DTI, the better your chances of getting approved for a home loan. 

Interest rates

Even small interest rate shifts can change what’s affordable. For example, on a $400,000 loan, even a quarter-point increase can add more than $20,000 in interest over 30 years. But a good mortgage rate looks different for everyone. Today, rates often fall in the 6% to 7% range, though the exact number depends on your loan type, term, and financial profile. 

The best way to see what fits your budget is to shop around and compare loan options. Get quotes from multiple lenders and see how they stack up. You can also compare mortgage rates on Better to get a clearer picture of where you stand. 

...in as little as 3 minutes – no credit impact

Location

Two homes at the same price can carry very different monthly costs depending on location. For example, states with the highest homeowners' insurance costs are often those most vulnerable to severe weather. This is why Vermont has some of the lowest average premiums at about $918 a year, while Florida homeowners face the highest, nearing $11,000 annually. 

Notably, in the 10 largest U.S. metro areas, suburban homes cost about 24% less than urban homes overall and about 23% less per square foot.

Breaking down your monthly mortgage payment

Your mortgage is made up of different parts that add up to your monthly bill. Here’s a breakdown of where that money goes.

Principal

Your mortgage principal is the starting amount you borrow from the lender. For example, if you buy a home listed at $300,000 and put down $60,000, your principal would be the remaining $240,000. Each monthly payment chips away at the principal, but only a portion goes toward reducing your interest.

Interest

Interest is the cost of borrowing money for a home. Lenders express it as a yearly percentage of your loan, called the interest rate. This rate is applied to your remaining principal, so your interest payments shrink as your balance goes down. Key factors, including your down payment and credit score, help determine which rate you get. This number can stay the same for the entire loan or change over time. 

Better makes the process easier with competitive rates and a streamlined digital pre-approval, so you can see where you stand quickly and confidently.

Property taxes

Property taxes are set by your local government and vary widely across the U.S. For instance, New Jersey’s rate is the highest at 1.52%, while Delaware’s is the lowest at 0.40%. 

Instead of paying one large bill each year, most homeowners use an escrow account to collect their funds. In that setup, your lender sets a portion of your mortgage payment aside and uses it to pay those bills on your behalf when they’re due.

If you want to check your property taxes, you have two options. One is to search the address on your county assessor’s website to see official tax records. Another is to estimate them yourself by finding the home’s value on a site like Zillow and then entering that number, along with your location, into an online property tax calculator.

Homeowners’ insurance

Homeowners insurance covers your home against threats like theft, fire, and storm damage. It also protects your possessions and provides liability if someone is hurt on your property. Most lenders ask for proof of a policy before closing to safeguard both their investment and yours. 

On average, homeowners' insurance costs about $217 a month, though rates vary based on coverage, location, and home size.

Additional costs to consider

There’s more to the cost of a home than just the price and the mortgage. A few extra expenses can change what you actually spend each month and over time. Here are some of the biggest ones to keep in mind:

— Closing costs: Buyer closing costs typically run 2–5% of a home’s purchase price. On a $400,000 home, that works out to about $8,000–20,000.

— Maintenance and repairs: Every home needs upkeep, whether it’s small fixes like leaky faucets and paint touch-ups or major projects like roof replacement and HVAC repairs. Setting aside money for these costs helps you avoid financial strain when they arise.

— Moving expenses: Expenses like truck rentals, packing supplies, and professional movers can quickly add up. Local moves average about $1,400, while long-distance moves can cost around $3,500.

How to increase your home affordability

A $100,000 salary is a good start, but small shifts in how you manage money can give you more room to buy. Here are a few changes to help stretch your budget:

— Build your credit score: A higher score usually gets you better rates, which lowers your monthly payment. You can build credit by taking steps such as keeping balances low and setting up autopay for utilities.

— Pay your debts: Cutting down on credit cards and loans improves your DTI ratio, which can help you qualify for a larger mortgage at better rates. It also leaves more of your paycheck free to save for a down payment and reduces how much you’ll need to borrow.

— Compare insurance rates: Insurance premiums vary widely, and even small differences add up over time. Comparing providers can lower your recurring costs, keep your budget more manageable, and help you avoid overpaying once you own the home. 

— Use buyer programs: Many first-time buyer and employer-sponsored programs offer down payment assistance. Taking advantage of these options can make homeownership more accessible sooner than you might expect. You can usually find them through state housing agencies, city programs, or employer HR departments.

How much house can I afford FAQs

What mortgage can I get with a $100k salary?

To figure out the mortgage for a $100k salary, start with the 30% guideline: aim to keep housing costs around $2,500 a month. With about 10% down and a fixed 6% interest rate, that payment level often aligns with homes priced between roughly $350,000 and $400,000, though exact affordability depends on local taxes and insurance.

Can I afford a $400k house on a $100k salary?

Yes, in many cases. A $400,000 home often falls within reach on a $100,000 salary with manageable debt, solid credit, and a 10% down payment. Though keep in mind that taxes and insurance can affect the final number.

How do interest rates influence the affordability of mortgage payments?

Interest rates play a huge role in how affordable a home truly is. Higher rates raise your monthly payment, which limits the loan amount you qualify for and narrows your price range. Lower rates reduce your borrowing costs, giving you room in your budget to afford a more expensive home or free up money for other expenses.

How does the size of the down payment affect your monthly mortgage payments and borrowing terms?

The more you put down, the less you need to borrow, which lowers your monthly payment. A larger down payment can also earn you better loan terms, such as a lower interest rate or the ability to skip private mortgage insurance (PMI). Together, these factors make your mortgage more affordable over the long run.

A clearer path to homeownership on $100,000 with Better

A $100,000 salary can open the door to homeownership, but income alone doesn’t determine what you can afford. Credit score, debt load, and down payment all factor into the final number. Looking at these pieces gives you a clearer picture of what’s realistic for your budget.

Better makes this process faster and more transparent. You can compare rates and secure a pre-approval in as little as three minutes. With everything laid out clearly, you’ll know exactly where you stand and can move forward with confidence.

Ready to get started? See how much home you can afford with Better today.

...in as little as 3 minutes – no credit impact