To afford a $250,000 house, you’ll need to earn a minimum of $55,310 per year. This calculation is based on a 30-year mortgage with an interest rate of 5% and a down payment of $12,500 (5 percent). Here are the figures broken down into monthly mortgage payments and annual income requirements:
Monthly mortgage payment: $1,300.42
Annual mortgage payment: $15,605.04
Property taxes (assumed at 1.2% of the home’s value): $3,000
Annual income needed: $55,310
It’s important to note that this calculation doesn’t take into account other expenses such as utilities, homeowner’s insurance, and maintenance costs. It’s always a good idea to create a comprehensive budget to determine if you can comfortably afford a home before making any big purchases.