Working out what you can genuinely afford starts well before you ask a bank for pre-approval, with an honest look at your actual monthly spending rather than just your income. Lenders will assess your borrowing capacity using their own benchmarks, but that figure is not necessarily the amount you will feel comfortable repaying every month.
Build a realistic household budget that includes loan repayments at a buffer above current interest rates, council rates, insurance, utilities and ordinary living costs. If the numbers feel tight even on paper, it is worth considering a smaller purchase price or a longer savings period before committing.
Factor in upfront costs separately from your ongoing borrowing capacity, since stamp duty, legal fees, inspection costs and moving expenses all need to be covered without leaving you with no financial buffer after settlement. A deposit that uses every available dollar leaves no room for the unexpected.
Consider your income stability and future plans, including whether you expect your household income to change through a career move, having children, or reducing work hours. Borrowing to the absolute maximum a lender will approve can leave very little flexibility if your circumstances shift down the track.
Speaking with a mortgage broker who can model different loan structures and interest rate scenarios gives you a clearer, more personal picture than a generic online calculator. The goal is a figure you can comfortably live with, not simply the highest amount a bank is willing to lend you.
Happy to talk it through — no pressure, no sales pitch.