How Much House Can You Afford on a $70k Salary?
Banks don't guess — they run two ratios against your gross pay. Here's the exact math on $70,000, why the down payment moves the answer by $24,000, and the levers that genuinely raise your ceiling.
The two ratios lenders actually check
On $70,000/year, gross monthly income is $5,833. The classic 28/36 rule sets two caps:
| Ratio | What it caps | On $70k |
|---|---|---|
| 28% front-end | Housing costs: principal, interest, taxes, insurance (PITI) | $1,633/mo |
| 36% back-end | Housing plus all other debt payments | $2,100/mo |
Whichever cap you hit first is your limit. Debt-free? The front-end binds. Carrying a $450 car payment and $200 in cards? You only have $1,450 left for housing — the back-end now decides.
Turning $1,633/month into a house price
Assume a 30-year loan at 6.5% and about 1.4% of the home's value per year for taxes + insurance:
| Down payment | Max home price | Loan | P&I |
|---|---|---|---|
| 10% down | $238,259 | $214,433 | $1,355.36 |
| 20% down | $262,458 | $209,967 | $1,327.13 |
Bigger down payment, higher price ceiling — and at 20% you also drop PMI, which we deliberately left out above (at 10% down, PMI would shave the ceiling further by $50–150/month of budget).
Five levers that raise the number
- Kill monthly debts first. Every $100/month of debt you clear frees ~$15,000–16,000 of price at current rates.
- Shop the rate. A half-point better rate adds roughly 4–5% to your ceiling. Get at least three quotes.
- Check the taxes, not just the price. The same house price with 2.2% property tax instead of 1.0% eats about $200/month of your cap.
- Two incomes qualify together. Lenders combine gross incomes for joint applications — the caps scale with it.
- Know your real take-home. 28% of gross can be 38%+ of net. Run your actual paycheck before committing.