How Much House Can I Afford on a $120K Salary?
With a $120K annual salary ($10,000/month gross), here is what you can afford using the 28/36 rule. Adjust your debts, down payment, and rate below to personalize.
Affordable States on a $120K Salary
These states have median home prices within your $401K budget, making homeownership realistic on a $120K salary.
Affording a Home on $120K
With a $120K annual salary, your gross monthly income is $10,000. The 28/36 rule allows up to $2,800 per month for housing costs, giving you access to most housing markets outside of the highest-cost coastal cities.
At this income level, you have real flexibility in loan products. Conventional loans with 10–20% down will get you the best rates, and many lenders will compete for your business. Shop at least 3–4 lenders — even a 0.25% rate difference saves thousands over the life of the loan.
Your approximate budget of $401K makes you competitive in the majority of U.S. markets. You can afford median-priced homes in states across the South, Midwest, and parts of the West. Even in pricier states, you will find options in suburban and exurban areas.
At this income, the question is less about what you can afford and more about what you should spend. Many financial advisors recommend keeping housing at 25% of gross income rather than the full 28%. The conservative estimate shown above gives you room for retirement savings, travel, and building long-term wealth beyond your home.