Home Affordability Calculator
What price you can afford from your income, deposit and existing debts — using the debt-to-income limits lenders apply.
Affordability is set by the smaller of two constraints: what the repayment ratio allows and what the deposit supports.
How the home affordability calculator works
Affordability is set by the smaller of two constraints: what the repayment ratio allows and what the deposit supports. Lenders cap total debt payments at around 36% of gross income — sometimes 43% — and the housing portion at about 28%.
The result is a borrowing capacity, and the price is that plus your deposit less costs. It is deliberately a maximum, not a recommendation: borrowing the full amount leaves nothing for the rate rising.
Formula: payment cap = income × ratio − other debts; price = loan + deposit
Worked examples
| Inputs | Affordable price | Note |
|---|---|---|
| 120k income, 100k deposit | £602,054.00 | about 600k |
| Conservative 28% limit | £468,620.71 | a smaller and safer number |
| With more existing debt | £435,262.39 | capacity falls sharply |
FAQFrequently asked questions
How much can I borrow?
Broadly, whatever keeps total debt payments under about 36% of gross income — though lenders differ and assess far more than this.
Is this what a lender will offer?
No. It is the standard ratio arithmetic. Actual approval depends on credit history, employment, the property and each lender's own serviceability buffer.
Should I borrow the maximum?
Rarely. This is a ceiling, not a target. The stress row shows what a three-point rate rise would do to the repayment.
What is a serviceability buffer?
Lenders assess you at a rate above the actual one — commonly three points — precisely to test what this page's stress row shows.
What about purchase costs?
Stamp duty, legal fees and inspections come out of the deposit before anything goes toward the price. Set them in Detailed mode.
Where these figures come from
- CFA Institute — Quantitative Methods: The Time Value of Money — the discounting, annuity and IRR conventions used here
- US Federal Reserve — Regulation Z (Truth in Lending), APR calculation — why APR includes fees where a nominal rate does not
- MoneyHelper (UK Government-backed) — the UK's free money guidance service
Last checked: September 2026. These are the standard textbook formulas; the conventions named are those of the CFA Institute curriculum and ISO 80000 usage.