For some, the housing prices in Florida may look cheap compared to New York or California. For others coming from places like Ohio or Tennessee, they may look expensive.
No matter which group you fall into, here’s what you need to consider to determine how much house you can afford in Florida:
How Much House Can You Afford in Florida?
There are many different factors involved in calculating how much house you can afford in Florida. So before you get started on your home search, let’s figure out what your budget should be based on these factors and calculations:
Factor 1: Your Income
The first factor that is used to determine how much house you can afford in Florida is your income. Generally, you should be able to afford no more than three times your annual salary on a house. So if you make $100,000 a year, you should look for houses that cost around $300,000.
Factor 2: Your Debts
The second factor that is used to determine how much house you can afford in Florida is your debt. In an ideal world, you would be able to spend your entire paycheck after taxes.
In reality, however, some of that money goes toward monthly debt payments for student loans, auto loans, and credit card debt.
Calculate Your Debt-To-Income Ratio
To get a better idea of how your monthly debts compare to your monthly income, you need to calculate your debt-to-income ratio.
Lenders use the DTI ratio to estimate how much you can borrow based on the 28%/36% rule. According to this guideline, no more than 36% of your gross monthly income should go toward debt payments, and no more than 28% should go toward housing payments.
So let’s say that you make $100,000 a year, which leaves you with about $8,333 a month gross. Let’s also say that you have minimum debts that just consist of a $200 monthly car payment and $100 monthly student loan payments.
Calculating your debts first at $300 a month, they make up a mere 3.6% of your gross monthly income. From there, you should be able to afford to spend up to 28% of your gross monthly income on your mortgage payments, or about $2,333.
It’s essential to keep in mind that just because you can afford to pay a certain amount doesn’t mean that you necessarily should. Lower monthly mortgage payments and saving more money on a monthly basis are always good things.
Factor 3: Your Down Payment
The third factor that is used to determine how much house you can afford in Florida is your down payment. If possible, it’s always recommended to put down 20% of the home’s purchase price. However, if that’s not possible, you may be able to put down as little as 3%, depending on your loan type.
Just remember that if you do put down less than 20%, your monthly mortgage costs are going to be higher, thanks to PMI. PMI is private mortgage insurance and is used by mortgage lenders to mitigate some of the risk they take on by lending to a low down payment borrower.
On average, PMI will cost you about 1% of your home loan amount per year. Once you reach 20% equity in your home, you can get rid of PMI.
Let’s suppose that you purchased a house for $300,000 but put the minimum of 3% down for a total of $9,000. This leaves you with a mortgage loan of $291,000, an annual PMI cost of just under $3,000, and a monthly PMI cost of about $250.
Factor 4: Your Interest Rate
The fourth factor that is used to determine how much house you can afford in Florida is your interest rate. After all, borrowing money isn’t free, and you will likely pay thousands of dollars over your loan term in interest.
Note that interest rates vary based on the type of loan you’re applying for and your financial profile. For example, 15-year loans come with lower interest rates than 30-year loans, and adjustable-rate loans often come with lower initial interest rates than fixed-rate loans.
Additionally, credit scores over 740 qualify for the lowest interest rates and the lower your credit score is, the higher your interest rate will be since lenders use this to help offset the risk they take by lending to someone with poor credit.
So for a 15-year fixed-rate loan in Florida with a credit score over 740, you can expect to pay 2.589% in interest. For a 30-year fixed-rate loan with the same credit profile, you can expect to pay just under 3.4% in interest.
If you have a lower credit score between 680 and 699 (the average credit score is 698), then you can expect to pay 3.834% in interest for a 30-year fixed-rate loan and 2.598% in interest for a 15-year fixed-rate loan.
Housing Expenses: Calculate Property Taxes and Homeowner’s Insurance Premium
Once you have taken into account your principal and interest, you also need to take into account the other components of your monthly mortgage payment, namely property taxes and homeowner’s insurance.
Property taxes are levied by the county you live in to cover things like schools, roads, parks, and emergency services. The exact property tax rate varies by county and even home value, but you can expect to pay just under 1% per year on property taxes in Florida. So if your home is worth $300,000, you will have to pay $3,000 a year or $250 a month.
Homeowner’s insurance is required by lenders as it protects your home in the event of damage from natural disasters, vandalism, or burglary. Homeowner’s insurance can be more expensive in Florida due to the higher likelihood of natural disasters like hurricanes and floods.
As a result, you can expect to pay around $1,500 a year or $125 a month for coverage. Keep in mind that your policy premium will vary based on your location and the features of your home.
What Can You Buy in Different Parts of Florida?
Florida is a large state with many distinct areas and real estate markets — some more expensive and competitive than others.
Now that you have a better idea of what you can afford to spend on a house in Florida, let’s take a look at some of the different real estate markets throughout the state to see what you can afford in different cities:
1. Miami
In Miami, the median listing home price is $465,200, and the median sold home price is $440,000. Generally speaking, you can expect to pay about $345 per square foot in Miami. The market in Miami remains competitive and is considered to be a seller's market as inventory remains low and demand is fueled by both domestic and international homebuyers.
2. Fort Lauderdale
In Fort Lauderdale, the median listing home price is $499,000, and the median sold home price is $440,000. Overall, you can expect to pay about $361 per square foot in Fort Lauderdale. The market in Fort Lauderdale is considered a seller’s market since there are more people looking to buy than there are homes available.
3. West Palm Beach
In West Palm Beach, the median listing home price is $325,000, and the median sold home price is $351,500.
Most likely, you can expect to pay about $225 per square foot in West Palm Beach. The market in West Palm Beach is considered a balanced market with supply equaling demand and with homes selling for 1.22% below asking price on average.
4. Tampa
In Tampa, the median listing home price is $355,000, and the median sold home price is $350,000. Generally speaking, you can expect to pay about $229 per square foot in Tampa. The market in Tampa is considered a strong seller’s market, with homes usually being sold at or above the asking price.
5. Clearwater
In Clearwater, the median listing home price is $330,000, and the median sold home price is $320,000. Generally, you can expect to pay about $232 per square foot in Clearwater. Like Tampa, the market in Clearwater is considered a strong seller’s market, with homes usually being sold at or above the asking price.
6. Sarasota
In Sarasota, the median listing home price is $450,000; the median sold home price is $420,000. Generally speaking, you can expect to pay about $271 per square foot in Sarasota. The market in Sarasota is also considered a strong seller’s market.
7. Fort Myers
In Fort Myers, the median listing home price is $325,000, and the median sold home price is $300,000. Generally speaking, you can expect to pay about $205 per square foot in Fort Myers.
Due to these relatively low home prices, the market in Fort Myers is extremely competitive for buyers. You should expect to pay the full asking price.
8. Naples
In Naples, the median listing home price is $566,000, and the median sold home price is $521,500. Overall, you can expect to pay about $310 per square foot in Naples.
Despite these higher prices, the market in Naples is still a strong seller’s market with no shortage of competition from buyers willing to meet or go above the asking price.
9. Orlando
In Orlando, the median listing home price is $335,000, and the median sold home price is $327,000. Generally speaking, you can expect to pay about $201 per square foot in Orlando. Due to these lower prices and the growth in the area, the Orlando market is considered quite competitive.
10. Jacksonville
In Jacksonville, the median listing home price is $272,000; the median sold home price is $280,000. Generally speaking, you can expect to pay about $168 per square foot in Jacksonville.
Even though the market in Jacksonville isn’t growing quite as much as in other places, it’s still considered a competitive seller’s market. Buyers should come prepared to offer the full asking price.
Making a Florida House Your Home
Based on these numbers, buying a house in Florida is well within your reach with the right lender. Vaster is a private lender willing to work with borrowers from all different backgrounds.
We even work with foreign investors with no stateside income or credit histories. So reach out to our lending experts today to see how we can make your dream of Florida homeownership come true.
The first factor that is used to determine how much house you can afford in Florida is your income. Generally, you should be able to afford no more than three times your annual salary on a house. So if you make $100,000 a year, you should look for houses that cost around $300,000.
On a $70,000 income, you'll likely be able to afford a home that costs $280,000–380,000. The exact amount will depend on how much debt you have and where you live — as well as the type of home loan you get.
This model states your total monthly debt should be 25% or less of your post-tax income. Let's say you earn $5,000 after taxes. To calculate how much you can afford with the 25% post-tax model, multiply $5,000 by 0.25. Using this model, you can spend up to $1,250 on your monthly mortgage payment.
To purchase a $300K house, you may need to make between $50,000 and $74,500 a year. This is a rule of thumb, and the specific salary will vary depending on your credit score, debt-to-income ratio, type of home loan, loan term, and mortgage rate.
How much house can I afford if I make $200K per year? A mortgage on 200k salary, using the 2.5 rule, means you could afford $500,000 ($200,00 x 2.5). With a 4.5 percent interest rate and a 30-year term, your monthly payment would be $2533 and you'd pay $912,034 over the life of the mortgage due to interest.
Assuming a 30-year fixed conventional mortgage and a 20 percent down payment of $80,000, with a high 6.88 percent interest rate, borrowers must earn a minimum of $105,864 each year to afford a home priced at $400,000.
A $100K salary puts you in a good position to buy a home
With a $100,000 salary, you have a shot at a great home buying budget — likely in the high-$300,000 to $400,000 range or above. But you'll need more than a good income to buy a house. You will also need a strong credit score, low debts, and a decent down payment.
To afford a $500,000 home, a person would typically need to make about $140,000 a year, said Realtor.com economic data analyst Hannah Jones. The principal and interest payments would total $2,791 per month, and with taxes and insurance, that number comes up to $3,508.
To determine whether you can afford a $650,000 home you will need to consider the following 4 factors. Based on the current average for a down payment, and the current U.S. average interest rate on a 30-year fixed mortgage you would need to be earning $126,479 per year before taxes to be able to afford a $650,000 home.
“Assuming other factors such as creditworthiness and debt-to-income ratio are favorable, someone with a $100,000 salary could potentially afford a home in the range of $300,000 to $400,000,” said Boyd Rudy, team leader and associate broker with MiReloTeam Keller Williams Realty Living.
A 100K salary means you can afford a $350,000 to $500,000 house, assuming you stick with the 28% rule that most experts recommend. This would mean you would spend around $2,300 per month on your house and have a down payment of 5% to 20%.
The annual salary needed to afford a $400,000 home is about $165,000. Over the past two years, home prices have skyrocketed amid the combined impacts of a global pandemic and housing inventory shortages. Between 2020 and 2022, home prices soared 30%, according to Freddie Mac.
An individual earning $60,000 a year may buy a home worth ranging from $180,000 to over $300,000. That's because your wage isn't the only factor that affects your house purchase budget. Your credit score, existing debts, mortgage rates, and a variety of other considerations must all be taken into account.
In your case, your monthly income should be about $21,585. The monthly payment on a 700k mortgage is $5,180. You may want to be a little more conservative or a little more aggressive. You'll be able to change this in our how much house can I afford calculator.
How much house can I afford on $70,000 a year? The house you can afford on a $70,000 income will likely be between $290,000 to $360,000. However, your home-buying budget depends on quite a few financial factors — not just your salary.
At a 7.00% fixed interest rate, your monthly mortgage payment on a 30-year mortgage might total $3,992 a month, while a 15-year might cost $5,393 a month.
What income is required for a 600k mortgage? To afford a house that costs $600,000 with a 20 percent down payment (equal to $120,000), you will need to earn just under $90,000 per year before tax. The monthly mortgage payment would be approximately $2,089 in this scenario. (This is an estimated example.)
How much do I need to make to buy a $300K house? You'll likely need to make about $75,000 a year to buy a $300K house. This is an estimate, but, as a rule of thumb, with a 3 percent down payment on a conventional 30-year mortgage at 5 percent, your monthly mortgage payment will be around $1,900.
If you make $50,000 a year, your total yearly housing costs should ideally be no more than $14,000, or $1,167 a month. If you make $120,000 a year, you can go up to $33,600 a year, or $2,800 a month—as long as your other debts don't push you beyond the 36 percent mark.
The lower your down payment, the higher your monthly mortgage payment. “With a $150,000 income, you could potentially save up to $100,000 – 20 percent – within a few years,” says Shri Ganeshram, CEO of real estate website Awning. “This would allow you to purchase a home in the $500,000 range.”
100k a year is also considered a six figure salary, meaning that you are considered a high-earning salary. Is $100k a year good money for a married couple? $100,000 is a good salary for a married couple and a family of four. $100,000 a year is still an above average income for a family.
Experts suggest you might need an annual income between $100,000 to $225,000, depending on your financial profile, in order to afford a $1 million home. Your debt-to-income ratio (DTI), credit score, down payment and interest rate all factor into what you can afford.
Monthly payments on a $500,000 mortgage by interest rate
At a 7.00% fixed interest rate, your monthly mortgage payment on a 30-year mortgage might total $3,327 a month, while a 15-year might cost $4,494 a month.
Assuming you are financing the purchase and put at least 20% down, most lenders will require you to have a salary of at least $450,000 per year to qualify for a $2 million home loan. This could be household income if both you and your spouse are on the loan.
To finance a 450k mortgage, you'll need to earn roughly $135,000 – $140,000 each year. We calculated the amount of money you'll need for a 450k mortgage based on a payment of 24% of your monthly income. Your monthly income should be around $11,500 in your instance. A 450k mortgage has a monthly payment of $2,769.
Earning more than $100,000 per year would put you well ahead of the median American household, which brings in $74,784 as of 2021. Assuming you're an individual without dependents, that salary would qualify you as upper class, according to three different definitions (Brookings, Urban Institute and Pew Research).
If you work a full 40-hour week for 52 weeks, that amounts to 2,080 hours of work. So $100,000 a year in income divided by 2,080 is a $48.08 hourly wage.
A $175,000 salary is equal to $14,583 per month in gross income; 28 percent of that comes to $4,083. So, according to the 28/36 rule, the maximum amount you should spend on housing is $4,083 per month. The 36 part of the rule, the sum you should not surpass in total debt, is 36 percent of $14,583, which is $5,250.
At a 7.00% fixed interest rate, your monthly mortgage payment on a 30-year mortgage might total $5,322 a month, while a 15-year might cost $7,191 a month.
At a 4.5% fixed interest rate, your monthly mortgage payment on a 25-year mortgage might total $4,427.78 a month, while a 15-year might cost roughly $6,102.94 a month.
If you or your household make between $250,000-$300,000, you are in the sweet spot to take on a $750,000 dollar mortgage. This is because you shouldn't spend much more than 3X your annual income on a home after putting 20% down. This is my 30/30/3 rule for home-buying.
It means you should spend no more than 28 percent of your income on your housing expenses and no more than 36 percent of your income on your total debt payments. If you're earning $100,000 per year, your average monthly (gross) income is $8,333. So, your mortgage payment should be $2,333 or less.
If you make $150,000 a year living in the region of Florida, USA, you will be taxed $38,017. That means that your net pay will be $111,984 per year, or $9,332 per month.
How much do I need to make for a $250,000 house? A $250,000 home, with a 5% interest rate for 30 years and $12,500 (5%) down requires an annual income of $65,310.
A 100K salary means you can afford a $350,000 to $500,000 house, assuming you stick with the 28% rule that most experts recommend. This would mean you would spend around $2,300 per month on your house and have a down payment of 5% to 20%.
To afford a $500,000 home, a person would typically need to make about $140,000 a year, said Realtor.com economic data analyst Hannah Jones. The principal and interest payments would total $2,791 per month, and with taxes and insurance, that number comes up to $3,508.
If you make $200,000 a year living in the region of Florida, USA, you will be taxed $52,102. That means that your net pay will be $147,899 per year, or $12,325 per month. Your average tax rate is 26.1% and your marginal tax rate is 36.5%.
If you make $300,000 a year living in the region of Florida, USA, you will be taxed $88,585. That means that your net pay will be $211,416 per year, or $17,618 per month.
Experts suggest you might need an annual income between $100,000 to $225,000, depending on your financial profile, in order to afford a $1 million home. Your debt-to-income ratio (DTI), credit score, down payment and interest rate all factor into what you can afford.
What is a livable salary in Florida? MIT's Living Wage Calculator says a livable salary for a single person in Florida with no children is about $36,000 before taxes.
Jacksonville is the most affordable city in Florida and coincidentally, it also has the youngest population in the state. There are activities and features galore here including 22 miles of beaches, historic neighborhoods, world-class fishing, museums, parks, and a thriving restaurant and craft beer scene.
Low income describes a family at or below 80% of area median income. Moderate income describes a family at or be- low 120% of area median income (at or below 100% of median income for federal programs).
The primary factor is your income — a $400,000 purchase typically requires a salary of at least $106,000. Other important considerations include your credit score, the size of your down payment and the details of your mortgage loan, including the interest rate.
Assuming a 30-year fixed conventional mortgage and a 20 percent down payment of $80,000, with a high 6.88 percent interest rate, borrowers must earn a minimum of $105,864 each year to afford a home priced at $400,000. Based on these numbers, your monthly mortgage payment would be around $2,470.
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