It's 11pm. You've got 27 Zillow tabs open. The mortgage calculator keeps giving you different answers depending on which site you're using. Your spreadsheet has three versions of your budget, and none of them agree with each other.
You've Googled "how much house can I afford" four times this week. You're more confused than when you started.
Sound familiar?
If you're a first-time buyer in Texas—whether you're looking in Fort Worth, Arlington, Roanoke, or anywhere in Tarrant County—you've probably noticed that the advice out there is all over the place. Some sites say you can afford 3x your annual income. Others say stick to 28% of your gross monthly income. Your coworker just bought a house that seems way out of your price range, and your parents keep asking when you're finally going to stop "throwing money away on rent."
Here's the thing: the process isn't as complicated as it feels right now. The confusion comes from conflicting advice and calculators that don't account for the real costs of buying in Texas.
Let's slow this down and look at the actual numbers—not the fantasy ones.
This guide will give you an honest, Texas-specific breakdown of what you can actually afford. We'll cover the costs that most calculators ignore, the assistance programs that could save you tens of thousands of dollars, and the real monthly payments at different income levels. No hype. No pressure. Just clarity.
Key Takeaways
- What you CAN borrow isn't the same as what you SHOULD borrow — lenders approve based on risk, not your lifestyle. We'll show you the difference.
- In Texas, property taxes and insurance can add $1,000+ per month on top of your mortgage payment. This is the cost most out-of-state calculators miss.
- First-time buyers in Texas can access up to $25,000 in down payment assistance — and most people don't know these programs exist.
- A household earning $70,000/year can realistically afford a home in the $250,000-$280,000 range in Tarrant County with comfortable monthly payments.
- The 2026 market has shifted in your favor — you have time to make a smart decision instead of a panicked one.
- Your credit score matters, but a 660 won't disqualify you — it just changes which loan program fits best.
The Real Question Behind "How Much House Can I Afford?"
When people ask this question, they're usually asking three different things at once:
- What will a lender approve me for? This is the math question—the formula lenders use to determine your maximum loan amount.
- What can I actually handle each month without stress? This is the budget question—what fits your real life, not just what looks good on paper.
- Am I even ready for this? This is the readiness question—whether now is the right time, or whether waiting makes more sense.
Here's the dangerous gap most people miss: lenders will often approve you for more than you should actually spend.
Their job is to assess risk—whether you're likely to repay the loan. That's it. A lender doesn't know you want to travel twice a year. They don't know you're saving for your kid's college. They don't know you'd rather keep your reliable car than upgrade to a newer one.
A lender might approve you for $400,000. That doesn't mean $400,000 is the right number for you.
This needs to make sense for YOU—not just for the bank. In this guide, we'll answer all three questions so you can make a decision you'll feel good about five years from now, not just at the closing table.
The Math: How Lenders Calculate What You Can Afford
Before we talk about what you should spend, let's understand what lenders actually look at. This is useful because it tells you the ceiling—the maximum you could theoretically borrow.
The Two Ratios That Control Everything
Lenders use two key percentages called debt-to-income (DTI) ratios. Both must fall within acceptable ranges for your loan to be approved.
The Front-End Ratio (Housing Ratio)
This measures what percentage of your gross monthly income goes toward housing costs. "Housing costs" includes more than just your mortgage payment:
Principal + Interest + Property Taxes + Homeowners Insurance + PMI (if applicable) + HOA dues (if applicable)
The standard limit for conventional loans is 28% of gross monthly income. FHA loans allow up to 31%.
The Back-End Ratio (Total Debt Ratio)
This measures your housing payment plus all other monthly debt obligations:
Housing costs + Car payments + Student loans + Credit card minimums + Child support
The standard limit for conventional loans is 36%, though lenders may approve up to 45% with strong credit and cash reserves. FHA loans allow 43-50% with compensating factors.
The Student Loan Trap
If you have student loans, pay close attention. Even if your loans are in deferment or an income-driven repayment plan showing $0 payments, lenders don't use $0 in their calculations.
FHA loans use 0.5% of your total loan balance as the assumed monthly payment. Conventional loans often use 1.0%.
Here's what that means: If you have $50,000 in student debt, lenders will add a "phantom payment" of $250-$500 to your monthly obligations—even if you're not currently paying anything. This alone can reduce your home purchasing power by $40,000 or more.
What Different Incomes Can Typically Afford
Here's a realistic breakdown based on Tarrant County costs (2.4% property tax rate, average insurance, 6.25% interest rate, 5% down payment):
| Annual Income | Monthly Gross | Max Housing Payment (28%) | Approximate Home Price Range |
|---|---|---|---|
| $50,000 | $4,167 | $1,167 | $180,000 - $210,000 |
| $70,000 | $5,833 | $1,633 | $250,000 - $280,000 |
| $85,000 | $7,083 | $1,983 | $300,000 - $330,000 |
| $100,000 | $8,333 | $2,333 | $350,000 - $380,000 |
| $120,000 | $10,000 | $2,800 | $420,000 - $450,000 |
*These ranges assume minimal other debt. Your numbers will vary based on credit score, existing debt, down payment, and the specific property's tax rate and insurance costs.
Want to run your own numbers? Try our mortgage calculator — it's built for Texas buyers and includes property taxes and insurance in the calculation.
The Texas Tax Reality: Why Your Payment Is Higher Here
This is the section most out-of-state websites get wrong. And it's the reason so many first-time buyers experience "payment shock" when they see their actual monthly costs.
In most states, your mortgage payment is mostly principal and interest—maybe 75-80% of the total. In Texas, principal and interest often make up only 55-60% of your monthly payment. The rest? Property taxes and insurance.
Why Texas Property Taxes Are Different
Texas has no state income tax. That sounds great—until you realize how the state makes up the difference.
Property taxes in Tarrant County fund schools, cities, the county, hospital districts, community colleges, and special districts. Each entity adds to your total tax bill.
Here's what a typical tax rate looks like:
| Taxing Entity | Typical Rate (per $100 of value) |
|---|---|
| School District (ISD) | $1.00 - $1.20 |
| City | $0.59 - $0.66 |
| Tarrant County | ~$0.19 |
| Hospital/College Districts | $0.20 - $0.30 |
| Total (Established Neighborhood) | ~2.4% |
Watch Out for MUDs and PIDs: In newer subdivisions—common in North Fort Worth, Roanoke, and parts of Arlington—developers use Municipal Utility Districts (MUDs) or Public Improvement Districts (PIDs) to finance infrastructure. These add an extra 0.5% to 1.0% to your tax rate. A home in an established neighborhood might have a 2.4% total rate. The same priced home in a new development could have a 3.1% rate. On a $400,000 home, that difference is $2,800 per year—or $233 per month.
Your Best Friend: The Homestead Exemption
Texas offers a Homestead Exemption that can significantly reduce your tax burden. As of 2025, the school district exemption is $100,000—meaning your school taxes are calculated as if your home is worth $100,000 less than its actual value.
For example: If your home is appraised at $350,000, school district taxes are calculated on $250,000.
Even better: Once you have the exemption, your assessed value can't increase by more than 10% per year, regardless of market appreciation. This protects long-term owners from tax spikes.
Important: You must apply for this exemption with the Tarrant Appraisal District. It's free, but not automatic. Beware of companies that charge fees to file this form for you—it's a common scam.
The Insurance Crisis
Texas homeowners insurance rates are among the highest in the nation, driven by hailstorms, tornadoes, and hurricanes.
In Tarrant County, your premium is heavily influenced by roof age. A home with a brand-new roof might insure for $2,500/year. The same home with a 15-year-old roof could cost $4,500/year—or be uninsurable with certain carriers.
Most Texas policies also have a separate wind and hail deductible, typically 1-2% of your dwelling coverage. On a $350,000 home with a 1% deductible, you'd pay the first $3,500 of any roof damage before insurance kicks in.
What This Means for Your Monthly Payment
Let's look at a real example for a $330,000 home in Fort Worth (close to the current median price):
Monthly Payment Breakdown: $330,000 Home
Principal & Interest: $1,932/month
Property Taxes: $660/month
Homeowners Insurance: $340/month
Total PITI: $2,932/month
In this example, taxes and insurance make up 34% of the total payment. If you only budgeted for the mortgage payment shown on a basic calculator, you'd be short over $1,000 per month.
"If you're feeling overwhelmed by these numbers, you're not alone. Most first-time buyers don't learn this until they're sitting at the closing table. That's exactly why we're walking through it now—so you're not surprised later."
The Down Payment Myth (And How to Actually Get Help)
Let's clear something up: You don't need 20% down to buy a house.
The 20% down payment is a holdover from your parents' era. Today's first-time buyers have options:
| Loan Type | Minimum Down Payment | Best For |
|---|---|---|
| Conventional | 3% | Buyers with 680+ credit |
| FHA | 3.5% | Buyers with 580-679 credit |
| VA | 0% | Veterans and active military |
| USDA | 0% | Eligible rural areas |
But here's the real barrier: It's not the percentage—it's the cash.
Even 3.5% of $330,000 is $11,550. Add closing costs (2-5% of the purchase price), and you need $18,000-$25,000 in the bank before you can close.
That's where Texas assistance programs come in.
Texas Assistance Programs Most People Don't Know About
Fort Worth Homebuyer Assistance Program (HAP)
This is the most generous local program available—and it's drastically underutilized.
- Up to $25,000 for down payment and closing costs
- Zero-interest, deferred loan — no monthly payments
- Forgiven after 5 years (if under $15,000) or 10 years (if $15,000-$25,000)
- Income limits: ~$85,350 for a family of four
- Must purchase within Fort Worth city limits
- Minimum buyer contribution: $1,000 or 2% (whichever is less)
If you're buying in Fort Worth and your household income is under $85K, this program can essentially eliminate your upfront cash requirement.
TSAHC (Texas State Affordable Housing Corporation)
Available statewide—including Arlington, Roanoke, Keller, and unincorporated Tarrant County.
- Up to 5% of the loan amount for down payment and closing costs
- Grant option (never repaid) or 3-year forgivable loan
- "Homes for Texas Heroes" program for teachers, police, firefighters, nurses, EMS, corrections officers, and veterans
- Income limits: ~$101,000+ for the DFW area
- Bonus: Mortgage Credit Certificate (MCC) — a federal tax credit that saves ~$2,000/year
TDHCA (My First Texas Home)
The state housing agency's flagship program.
- Up to 5% assistance for down payment and closing costs
- Income limits: ~$104,420 for families of 3+ in the DFW area
- Higher limits in "Targeted Areas" (designated census tracts) — up to ~$149,000
- In Targeted Areas, the first-time buyer requirement is waived
If you work for a school district, hospital, fire department, or police department—or if you're a veteran—you likely qualify for programs that could cover your entire down payment. Most people don't realize these programs exist or assume they won't qualify. It's worth checking.
| Program | Max Assistance | Forgiveness | Income Limit (Family of 4) | Where |
|---|---|---|---|---|
| Fort Worth HAP | $25,000 | 5-10 years | ~$85,350 | Fort Worth only |
| TSAHC | 5% of loan | Grant or 3 years | ~$101,000+ | Statewide |
| TDHCA | 5% of loan | Varies | ~$104,420 | Statewide |
Not sure which programs you qualify for? Let's look at your situation together — no pressure, just answers.
What Your Salary Can Actually Buy in Tarrant County
Let's get specific. Here's what homeownership actually looks like at different income levels in the 2026 Tarrant County market.
Scenario 1: $60,000/Year (Single Income)
Profile: Administrative coordinator, customer service manager, early-career professional
Monthly gross income: $5,000
Target home price: $215,000 - $230,000
Strategy: Fort Worth HAP ($20,000 assistance)
Loan amount: ~$195,000
Estimated monthly payment: ~$1,830
DTI ratio: 36.6%
Where to look: East Fort Worth, Poly, Stop Six revitalization areas, parts of South Arlington
At $60K, the mortgage calculator might tell you to stretch to $280K. Don't. With a $215K home and assistance covering your down payment, you'll have breathing room for life—not just survival. You'll be able to handle a car repair or take a vacation without the house eating every dollar.
Scenario 2: $85,000/Year (Single Income or Entry-Level Dual Income)
Profile: Mid-career professional, or young couple with combined entry-level incomes
Monthly gross income: $7,083
Target home price: $300,000 - $330,000
Strategy: 5% down conventional or TSAHC assistance
Loan amount: ~$315,000
Estimated monthly payment: ~$2,700
DTI ratio: 38%
Where to look: Fort Worth (most neighborhoods), Arlington, North Richland Hills
This income level hits the sweet spot for the Fort Worth and Arlington markets. You're right at or slightly below the median home price, which means plenty of inventory to choose from and room to negotiate.
Scenario 3: $115,000/Year (Dual Income)
Profile: Teacher + nurse household, or two mid-career professionals
Monthly gross income: $9,583
Target home price: $350,000 - $380,000
Strategy: TSAHC Homes for Texas Heroes (3% grant) + MCC tax credit
Estimated monthly payment: ~$3,320
DTI ratio: 34.6%
MCC benefit: ~$2,000/year in federal tax credits
Where to look: Arlington, North Richland Hills, Grapevine (older homes), Hurst-Euless-Bedford
If either partner works in education, healthcare, public safety, or served in the military, the Texas Heroes program is a no-brainer. The 3% grant plus the ongoing MCC tax credit can save you $15,000+ over the first five years of ownership.
Scenario 4: $150,000+/Year (Higher Dual Income)
Profile: Family of four targeting suburban schools in Keller ISD, Carroll ISD, or Northwest ISD
Target home price: $450,000 - $500,000
Reality check: At $500K with MUD taxes (3.1% rate), monthly payment approaches $4,200+
Property taxes alone: ~$1,200/month
Where to look: Keller (older homes under $500K), established areas of Roanoke, edges of Colleyville, Southlake (fixer-uppers only at this price)
Higher income doesn't always mean higher home. A $500K home in a MUD district can feel tighter than a $400K home in an established neighborhood. Always run the full PITI calculation—not just the mortgage payment—before falling in love with a property.
The Hidden Costs Nobody Talks About
Beyond your monthly mortgage payment, there are costs that catch first-time buyers off guard. Let's make sure you're not one of them.
Closing Costs (The Cash Hurdle)
Closing costs in Texas typically run 2-5% of the purchase price. On a $330,000 home, that's $6,600 to $16,500.
The biggest components:
| Cost | Typical Amount |
|---|---|
| Prepaids (escrow setup: first year insurance + 3 months taxes) | ~$6,000 |
| Lender fees (origination, underwriting, processing) | $2,000 - $4,000 |
| Title insurance (lender's policy) | $500 - $1,000 |
| Appraisal | $400 - $600 |
| Survey (if needed) | ~$500 |
| Home inspection | $400 - $600 |
The Foundation Reality
Tarrant County sits on expansive clay soil. It shrinks during drought and swells when it rains. This constant movement stresses home foundations.
If you buy here, you'll learn about the "soaker hose ritual"—watering your foundation during dry summers to prevent cracking. It sounds strange, but it's a real thing that experienced Texas homeowners take seriously.
Foundation repair, if needed, typically costs $5,000 to $15,000. During your home inspection, make sure the inspector thoroughly evaluates the foundation—and budget for maintenance.
Utility Shock
Texas has a deregulated electricity market, which means you choose your provider. That's good for competition, but it requires active management.
More importantly: air conditioning runs 8-9 months a year in North Texas. In older, poorly insulated homes, summer electric bills can exceed $300-$400/month.
Before making an offer, ask the seller for the previous 12 months of utility bills. This tells you the true cost of keeping the home comfortable.
The First-Year Fund
Beyond closing, plan for expenses that hit in the first year:
First-Year Expenses to Budget For
- Appliances that weren't included in the sale
- Lawn equipment (mower, trimmer, hoses)
- Window treatments (most homes sell without them)
- Minor repairs the inspection didn't catch
- Furniture for rooms you didn't have before
- Paint and basic updates you'll want to make
A reasonable first-year buffer: $3,000 to $5,000 minimum.
Pre-Purchase Cash Reserves Checklist
- Down payment (or assistance confirmation)
- Closing costs (2-5% of purchase price)
- Moving expenses
- First-year emergency fund ($3,000-$5,000)
- 3 months of mortgage payments in savings (lender may require this)
The 2026 Market: What's Actually Happening
If you tried to buy a house in 2021 or 2022, you remember the chaos. Multiple offers within hours. Buyers waiving inspections. Homes selling for $50,000 over asking price.
That's not the market you're walking into today.
The Shift in Your Favor
The Tarrant County market has stabilized significantly. Here's what the data shows:
| City | Median Price | Year-Over-Year Change | Avg. Days on Market |
|---|---|---|---|
| Fort Worth | $330,000 | -1.8% | 65 days |
| Arlington | $335,000 | -1.2% | 65 days |
| North Richland Hills | $365,000 | -5.3% | 42 days |
| Grapevine | $568,000 | -4.1% | 61 days |
| Roanoke | $585,000 | +7.7% | 124 days |
What this means for you:
You have time to think. Homes are sitting for 60+ days in most areas. You can view a property twice, sleep on it, and come back without it being gone.
You can request repairs. Sellers are negotiating again. Inspection findings that would have been ignored in 2021 are now valid negotiation points.
You can ask for closing cost assistance. Seller concessions—where the seller credits you money at closing to offset your costs—are back on the table.
You don't have to waive inspection. In fact, you shouldn't. The market no longer punishes buyers for protecting themselves.
Interest Rate Reality
Current 30-year fixed rates hover between 6.06% and 6.29%. Forecasts suggest rates will stay in the 6.0%-6.4% range through 2026.
If you're waiting for rates to drop to 4%—that's not coming back anytime soon. Most economists expect the current range to be the "new normal" for the foreseeable future.
The strategy: Qualify based on today's rate. If rates drop later, you can refinance. But don't make that assumption a requirement for your budget to work.
The best time to buy isn't when rates are lowest. It's when you're financially ready and the market gives you room to make a smart decision. For many buyers, that's right now.
Are You Actually Ready? (The Honest Checklist)
Before you start shopping, answer these questions honestly. There's no judgment here—just clarity about where you stand.
You're Probably Ready If:
Financial Readiness Indicators
- Credit score is 620+ (ideally 680+ for better rates)
- Stable income for 2+ years (same employer or same field)
- You can document your income (W-2s, or 2 years of tax returns if self-employed)
- You have cash reserves beyond your down payment
- Your monthly debt payments are manageable (car, student loans, credit cards)
- You're planning to stay in the area at least 3 years
- You have a clear picture of what you can afford (not just what you want)
You Might Want to Wait If:
Signs It's Not Quite Time Yet
- You're planning to change jobs in the next 6 months
- You have collections or judgments on your credit report
- Your savings would be completely wiped out by closing
- You're not sure where you want to live long-term
- You're buying because of external pressure, not because it makes sense
- Your income is inconsistent or hard to document
- You have high-interest debt you should pay off first
"There's no shame in waiting. Sometimes the smartest financial move is giving yourself another 6-12 months to save, pay down debt, or figure out what you actually want. We'd rather help you buy the right home at the right time than rush you into the wrong one."
Frequently Asked Questions
What salary do I need to afford a $400,000 house in Texas?
Generally, you'd need a household income of around $110,000-$120,000 to comfortably afford a $400K home in Tarrant County, assuming minimal other debt. With Texas property taxes and insurance, your monthly payment would be approximately $3,400-$3,600. If you have significant car payments or student loans, you'd need to earn more to qualify.
Can I afford a $300K house on a $70K salary?
It's possible but tight. At $70K, your comfortable range is $250,000-$280,000. A $300K home would push your DTI ratio above 40%, leaving little margin for unexpected expenses. If you have a co-borrower or minimal other debt, it becomes more feasible. But we'd generally recommend staying in the $250K-$280K range to maintain financial flexibility.
How much do first-time homebuyers have to put down in Texas?
As little as 3% for conventional loans or 3.5% for FHA loans. With Texas assistance programs like Fort Worth HAP (up to $25,000) or TSAHC (5% of the loan amount), many first-time buyers put down $1,000 or less of their own money. VA loans require 0% down for eligible veterans and active military.
What is the 28/36 rule for home buying?
The 28/36 rule suggests your housing payment should be no more than 28% of gross monthly income, and total debt payments no more than 36%. In Texas, the 28% rule is especially important because property taxes and insurance take a larger share of that payment than in other states. Staying within these limits helps ensure you're not "house poor."
How much are closing costs in Texas?
Typically 2-5% of the purchase price. On a $330,000 home, expect $6,600-$16,500. The biggest components are prepaids (escrow setup for taxes and insurance), lender fees, title insurance, and the appraisal. Many assistance programs can be used toward closing costs, not just the down payment.
What credit score do I need to buy a house in Texas?
Minimum 580 for FHA (with 3.5% down) or 620 for conventional loans. However, scores below 680 typically result in higher interest rates or additional fees. Scores above 740 get the best rates and terms. If your score is below 620, spending 6-12 months improving it before buying can save you tens of thousands over the life of the loan.
Is it better to buy in Fort Worth or Arlington?
Both markets are similarly priced ($330K-$335K median) and offer good value for first-time buyers. Fort Worth has more inventory and the HAP assistance program ($25K). Arlington has slightly lower property taxes in some areas and central location between Dallas and Fort Worth. The best choice depends on your commute, school preferences, and whether you qualify for Fort Worth's assistance program.
Ready to See What You Can Actually Afford?
You've absorbed a lot of information. The next step is making it personal to your situation—your income, your savings, your goals. No pressure, no sales pitch. Just clarity.
Try Our Mortgage Calculator Schedule a CallOur calculator is built for Texas buyers—it includes property taxes and insurance so you see the real monthly payment, not just principal and interest.
Buying a home should feel like a confident decision, not a panicked one. When you're ready, we're here to help you figure out the right move—even if that move is waiting a little longer.
That's the TK Realty difference. No rush. No pressure. Just guidance that makes sense for your life.
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