Can I afford a home making $150,000 a year?

The math on a $150,000 salary

$150,000 divided by 12 is $12,500 gross monthly. The 28% conservative rule gives $3,500/month in PITI, which at 6.75% / 30-year / 5% down supports about $525K–$620K in purchase price. Stretched to 45%–50% DTI, most $150K borrowers can qualify up to $780K–$820K.

At this income you're often right at the conforming loan limit ($806,500 in 2026 for most counties, higher in high-cost areas). Crossing into jumbo territory triggers stricter reserves (6–12 months), higher credit-score floors (usually 700+), and — historically — a slightly better rate than conventional. If you're straddling the limit, ask about a piggyback second (80/10/10) to stay conforming on the first.

The overshoot trap

$150K households are the most common overshoot buyers we see. The mistake: qualifying at $820K, buying at $780K, and discovering the true cost — property tax, insurance, HOA, maintenance, utilities on a bigger home — pushes actual monthly cash outflow past $6,500 while gross take-home after tax is only $9,200. That's 70% of net going to housing, which crushes retirement, college savings, and freedom.

A better frame at $150K: target $4,000–$4,500/mo PITI. That's a $600K–$680K home with 10%–15% down. You keep enough net income for max 401(k), Roth IRA, and a real emergency fund.

Best loan program on $150K

Conventional is almost always the right call. With a 740+ FICO and 10%–20% down, you'll get the best rate and either minimal PMI (that drops off automatically) or none.

VA is still the winner if you're eligible — zero down and no PMI on up to conforming limit, sometimes higher.

Jumbo kicks in above the conforming limit. Expect 10%–20% down minimum, 700+ FICO, and 6+ months of reserves.

FHA rarely makes sense at $150K — MIP for life outweighs any DTI headroom you gain.