How Much House Can I Afford With 20% Down?
Putting 20% down gives you the lowest monthly payment, the best rates, and zero PMI. Here's exactly how much house that translates to at every salary level.
Quick answer
With 20% down, most buyers can comfortably afford a home priced 4–5× their gross income. On a $100K salary, that's roughly $400K–$500K with no PMI.
Affordability by salary with 20% down
Assumes a 6.5% rate, no PMI, average taxes/insurance, and a comfortable 28% housing DTI:
- $50K salary → home price about $200,000 (down payment: $40,000)
- $75K salary → home price about $300,000 (down payment: $60,000)
- $100K salary → home price about $410,000 (down payment: $82,000)
- $125K salary → home price about $510,000 (down payment: $102,000)
- $150K salary → home price about $610,000 (down payment: $122,000)
- $200K salary → home price about $810,000 (down payment: $162,000)
What 20% down actually buys you
On a $400,000 home with 20% down ($80,000) at 6.5%:
- Loan amount: $320,000
- Principal + interest: $2,023/month
- Property tax + insurance: about $525/month
- PMI: $0
- Total monthly payment: about $2,548
Compare to 5% down on the same home: monthly payment jumps to roughly $3,000 with PMI. The 20% down buyer saves $450+/month and around $162,000 in total interest over 30 years.
The downsides of 20% down
- You wait years longer to buy — often 5–10 extra years of saving
- You tie up a huge chunk of liquid savings in your home
- Opportunity cost: that same $80K invested at 7% could grow to $610K over 30 years
- If home prices rise faster than your savings rate, you fall behind
When 20% down makes the most sense
- You have ample savings beyond the down payment (emergency fund + retirement on track)
- You're buying in a stable market without rapid appreciation
- You hate the idea of paying PMI
- You want the lowest possible monthly payment for cash flow flexibility
- Your interest rate is high — paying down more upfront has a real return
Practical alternative: split the difference
Many financially-savvy buyers put down 10–15% and invest the rest. They pay some PMI for a few years (which falls off automatically), keep a robust emergency fund, and let their other money compound in index funds. Run both scenarios in the calculator before committing.
Use the calculator
Run the 20% down scenario
Plug in your salary and see the exact home price you can afford with 20% down.
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Frequently Asked Questions
Should I always put 20% down?
Not always. If saving 20% means waiting 5+ years and home prices keep rising, putting 5–10% down and buying now often wins out financially.
Do I get a better mortgage rate with 20% down?
Usually a small discount — about 0.125%–0.25% lower than low-down-payment loans, depending on lender.
What if I have more than 20%? Should I put it all down?
Generally only if your investment alternatives return less than your mortgage rate after tax. With 7% mortgages, putting extra down is competitive with stock market returns.
How much income do I need for a $500K house with 20% down?
Roughly $125,000–$135,000 a year, assuming average debts and a 6.5% rate.
Does 20% down avoid PMI on all loan types?
On conventional loans, yes. FHA loans require mortgage insurance regardless of down payment, so 20% down doesn't eliminate it on FHA.