How Much Do You Need to Earn to Afford a Million-Dollar Home?

Despite increasing inflationary measures and the lack of new homes being built, demand for luxury homes has remained hot in the U.S.

It would be nice to have a wad of cash or an inheritance to pay cash for a million-dollar home. But if you’re looking to go through the mortgage route to purchase your home, you’ll need to be bringing home a sizable salary.

Assuming you’re able to come up with a 20% down payment for a $1 million home purchase ($200,000 down payment amount), you could be looking at a monthly mortgage payment of about $5,000 - and let’s consider a 6.5% interest rate.

Based on a standard budgeting guideline that says you shouldn’t spend more than 30% of your income on housing, you’d need to be making around $15,000 per month - which is equivalent to at least $180,000 annually to afford your million-dollar home.