How Much House Can You Afford?

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Let's skip the calculators for a minute.

Most people start house hunting by punching numbers into a mortgage tool and letting it spit out a max price. That's not wrong, but it's backwards. What a bank says you can spend and what you should spend are two very different things. I've watched people get handed a pre-approval number that made their eyes go wide, and not always in a good way.

I've sat across the table from enough buyers to know the real question isn't "how much will they lend me?" It's "how much house can I carry without my life feeling tight?" Because the loan officer isn't the one who has to live in the budget once the keys are handed over. You are.

Here's what actually matters:

Your monthly payment isn't just principal and interest. Taxes, insurance, and PMI all hitch a ride, and they don't ask permission. A $2,000 mortgage can turn into $2,600 real quick depending on where you're buying. Genesee County looks different from Oakland County on that front. So does Lapeer versus Macomb. Even two houses in the same zip code can have wildly different tax bills depending on millage rates and assessment history. I always tell people get the full picture, not just the loan estimate.

Maintenance is real and it's not optional. The roof doesn't care about your budget. Neither does the water heater, the furnace, or the driveway that decides to crack after a hard winter. Figure roughly 1% of the home's value per year set aside for repairs. Some years you'll spend nothing. Some years the furnace gives out in January and you're looking at a five-figure replacement. If your budget is stretched to the max on day one, that first big repair is going to hurt.

You still need to live your life. If your mortgage leaves you with nothing for dinner out, weekend trips, or the occasional splurge, you bought too much house. I don't care what the pre-approval letter says. I've seen people buy at the top of their range and then realize they can't take a vacation, can't even grab takeout without sweating it. That's not winning that's house poor, and it wears on you.

The numbers shift by county. What gets you a 3-bedroom in Livingston might get you something completely different in Washtenaw. Taxes, insurance, even utility costs, it all depends on where you land. A house in one county might cost less upfront but carry a tax bill that eats up the difference within a few years. It pays to look at the whole picture, not just the listing price.

Interest rates move the needle more than you think. A half-point difference in your rate can mean tens of thousands of dollars over the life of the loan. And it doesn't just affect the total it changes your monthly payment right now. That's why it matters who you work with. A good lender isn't just running a credit check and printing a letter. They're helping you understand what different scenarios actually look like so you can make a decision you feel good about.

So here's my advice start with what you're comfortable paying each month, not what you qualify for. Work backwards from there. And if you're not sure where to start, talk to a lender who'll actually walk you through the numbers instead of just handing you a letter and wishing you luck.

The goal isn't the biggest house you can afford. It's a house that still lets you afford your life.