$7,185
House · 28% of net · United States
How much can I spend on housing from my take-home pay?
This take-home vs a mortgage.
28% of monthly net is the housing cap we use. The full cost of owning lives on OwnerCost — we do not rebuild it here.
$2,012 / month for housing
28% of your $7,185 monthly take-home. Not 28% of gross, not a multiple of salary.
$2,012
78.4%
Open OwnerCost for United States — the full monthly cost of owning: mortgage, tax, insurance and purchase costs.
A worked example
On the starting $110,000 salary, take-home is $7,185 a month, so 28% of net is $2,012 a month for housing. 28% of gross would be $2,567: $555 more, all of it money that goes to tax before it reaches you.
That is why KeptOffer uses net. The rule is a personal budget, not a lending test: a lender may offer more, and you then have to live on what is left.
28% of net vs 28% of gross
| Salary | Take-home / month | 28% of net | 28% of gross |
|---|---|---|---|
| $60,000 | $4,199 | $1,176 | $1,400 |
| $90,000 | $6,012 | $1,683 | $2,100 |
| $110,000 | $7,185 | $2,012 | $2,567 |
| $160,000 | $10,052 | $2,815 | $3,733 |
What counts as housing cost
In the US, the monthly cost of owning is usually summarised as PITI: principal, interest, property tax and homeowners insurance, plus HOA fees and mortgage insurance where they apply. Property tax rates vary a lot by state and county, so check the rate where you are buying.
Count all of it against the 28% figure, not just the mortgage payment.
How to use it
- Treat the 28%-of-net figure as the most you want to spend each month on the whole cost of the home: mortgage, property tax or rates, insurance and fees.
- Then price a real home on OwnerCost, which adds up the full monthly cost of owning, and check what a lender would offer with its affordability calculator.
- If the two numbers are far apart, the gap is the part of your take-home that would go to housing instead of savings and everything else.
What this does not include
- A partner's income: run each salary separately and add the take-home figures.
- Lenders' own affordability tests, which are based on gross income and other debts.
- Deposit, purchase taxes and moving costs, which OwnerCost covers.
Questions people ask
Why 28%?
It is a common budgeting guideline for housing costs. KeptOffer applies it to take-home pay rather than gross, which gives a more conservative and more honest number.
Is this how much I can borrow?
No. It is how much you can comfortably pay each month. For borrowing, use a lender's calculator or OwnerCost's affordability calculator.
Does it include my partner's income?
No. Calculate each salary on the Net page and add the monthly take-home figures, then take 28% of the total.