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Affordability

Can You Afford It? The 28% Rule for a Chicago Home or Condo

A simple rule of thumb and a calculator that counts property tax, HOA dues and insurance too.

Bilal Hameed, Illinois real estate broker, License #475.219071 · Affiliated with Crosstown Realtors Inc.

6 cards

Affordability

The 28% rule, in plain words

A common rule of thumb: keep your whole housing payment under about 28% of your monthly income.
The payment is more than the loan. It also holds property tax, insurance, HOA dues and sometimes mortgage insurance.
The rule is usually told with gross pay. Take-home pay gives a smaller, more careful answer.

Same price. Different monthly bill.

Aqua tower, Chicago. Photo: Ballparx, Public domain, Wikimedia Commons

Try it

What price fits?

Every starting number is a placeholder, not a market fact. Use your own pay, your lender's rate, a real tax bill and the building's HOA.

Monthly income

Down payment %

Interest rate % (ask your lender)

Loan years

Property tax % of price per year

Insurance, $ per month

HOA dues, $ per month

Mortgage insurance % per year (only under 20% down)

Safe monthly payment: -

Price that fits: -

Where the payment goes

Look past the price tag.

Orchard Street, Lincoln Park, Chicago. Photo: Warren LeMay, CC BY-SA 4.0, Wikimedia Commons

Infographic

HOA dues shrink the price that fits

Same income, rate, tax and insurance as the last card. Only the HOA changes.

More detail: condo papers (Section 22.1)

Condo papers (Section 22.1)

In a condo, the association must answer a written request for these papers within 10 business days (Illinois Public Act 102-0976, effective Jan 1 2023). Ask your attorney early. Look for HOA dues, reserves and any planned special assessment.

Neighborhood prices

Median prices and days on market for Fulton Market, River North, Wicker Park, Logan Square and Lakeview: [CITATION NEEDED]. We add them once Bilal pulls a Cloud CMA or MRED report, with the source and date.

Next step

Ready when you are

Talk to Bilal about a home Book a showing

Sources

Illinois Public Act 102-0976 (condo disclosure)
Calculator: your own inputs. Rule of thumb only; your lender decides what you can borrow.

Bilal Hameed, Illinois real estate broker, License #475.219071 · Affiliated with Crosstown Realtors Inc.

🏠 Equal Housing Opportunity. We never steer, screen or sort anyone by a protected trait. General information, not legal or financial advice.

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