How Much House Can I Afford in Central Texas?
Affordability is more than the sticker price. Here is how to think about your full monthly picture as a Greater Houston buyer.
This article is a draft for review. It is for educational purposes only and is not a commitment to lend or a rate quote.
The short answer
How much house you can afford depends on your full monthly housing payment — principal, interest, property taxes, insurance, and any HOA or mortgage insurance — not just the home's price. In Greater Houston, property taxes and insurance can add meaningfully to that payment, so budgeting for the total is essential.
Start with your total monthly payment
Lenders typically look at your housing payment as a share of your gross monthly income, and your total debts as another share. But the number that matters to your life is the full monthly payment including taxes and insurance — not just principal and interest.
Why Greater Houston is different
Property tax rates and insurance costs vary by county, school district, and MUD. Two homes with the same price can have very different monthly costs depending on where they sit. Always estimate taxes and insurance for the specific property.
Build in a cushion
A lender's maximum is not the same as what is comfortable. Many buyers prefer to keep their housing payment below the lender's ceiling to leave room for maintenance, savings, and life changes.
Example
Example (illustrative only, not a quote): A $350,000 home with 20% down leaves a $280,000 loan. Principal and interest are only part of the story — Greater Houston property taxes and insurance can add hundreds of dollars per month on top. The total monthly payment, not the loan amount, is what you live with.
FAQs
What is the 28/36 rule?
It is a common guideline suggesting housing costs stay near 28% of gross monthly income and total debt near 36%. These are guidelines, not rules, and lenders vary. We look at your real numbers.
Do property taxes really change affordability that much?
Yes. In Greater Houston, taxes vary by district and can be a significant part of the monthly payment. We estimate them for the specific property you are considering.
Authoritative Sources
Author
John Money McKinley, NMLS #221964
Senior Loan Officer · Mortgage Advisor · LendSmart Powered by APM, NMLS #1850
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