ERIC KELLEY

REALTOR | ATTORNEY

How Much House Can You Really Afford in the Philly Suburbs in 2026?

Summary

Most buyers in the Philadelphia suburbs rely on online mortgage calculators to decide how much house they can afford. Unfortunately, those calculators are dangerously incomplete. They ignore taxes, insurance, HOA fees, maintenance, student loans, childcare, and the psychological reality of living with a large monthly payment.

In 2026, affordability isn’t about how much a bank will lend you—it’s about how much lifestyle you’re willing to sacrifice.

This guide walks through a more realistic framework so buyers across the Main Line, Chester County, and Bucks County can buy with confidence instead of stress.

 

Table of Contents

  1. Why “Pre-Approved” Is Not the Same as “Affordable”

  2. The Philly Suburbs Cost Structure

  3. The 28% Rule Is Outdated

  4. The True Monthly Payment

  5. Property Taxes and School District Premiums

  6. Childcare, Commuting, and Lifestyle Costs

  7. How Rates Change Your Buying Power

  8. The Affordability Stress Test

  9. How Smart Buyers Use This Model

 

1. Why “Pre-Approved” Is Not the Same as “Affordable”

Lenders tell you what you can borrow. They do not tell you what you should borrow.

A bank might approve you for a $900,000 mortgage. That doesn’t mean you should take it. Banks only care about default risk—not your quality of life.

They don’t factor in:

  • Private school tuition

  • Childcare

  • Retirement savings

  • Travel

  • Home repairs

  • Or the stress of being house-poor

Affordability is a lifestyle decision, not a credit decision.

 

2. The Philly Suburbs Cost Structure

Homes in the Philadelphia suburbs are expensive in ways buyers don’t always see upfront.

In many Main Line and Chester County towns:

  • Property taxes can exceed $15,000–$25,000 per year

  • Insurance is rising due to climate risk and rebuild costs

  • Older homes have higher maintenance

  • HOAs are common in townhome communities

These costs matter as much as the mortgage.

 

3. The 28% Rule Is Outdated

The old rule says housing should be no more than 28% of gross income. In today’s high-tax, high-insurance, high-rate world, that rule is misleading.

In practice, many buyers who exceed 30–32% housing cost feel financial pressure quickly—especially when kids, cars, or student loans enter the picture.

A better rule is:

Your housing payment should not prevent you from saving, traveling, or handling surprises.

 

4. The True Monthly Payment

Your real housing cost includes:

  • Principal & interest

  • Property taxes

  • Homeowner’s insurance

  • HOA (if applicable)

  • Maintenance reserve

For many suburban Philly homes, this can add 30–50% to the mortgage payment.

A $4,500 mortgage can easily become a $6,000–$6,500 housing cost.

 

5. Property Taxes and School District Premiums

Two identical homes priced at $700,000 can have wildly different monthly costs depending on:

  • Municipality

  • School district

  • Tax millage

Lower Merion, Radnor, Tredyffrin-Easttown, and Unionville-Chadds Ford often carry higher taxes—but also higher long-term value retention.

You’re not just buying a house—you’re buying into a tax and school ecosystem.

 

6. Childcare, Commuting, and Lifestyle Costs

A family paying:

  • $2,000–$3,000 per month for childcare

  • $500+ per month commuting

  • $1,000+ in student loans

cannot afford the same home as someone with no dependents—even with the same income.

Real affordability must consider:

  • Stage of life

  • Job stability

  • Family plans

  • Lifestyle priorities

 

7. How Rates Change Your Buying Power

At 7% interest, every $100,000 borrowed costs about $665 per month.

That means:

  • A $900,000 home with 20% down could cost $5,000+ in mortgage alone

  • Add taxes and insurance, and you may be at $6,500+

Small rate changes dramatically shift affordability.

 

8. The Affordability Stress Test

Before buying, ask:

  • Could we handle this payment if one income paused?

  • Could we still save for retirement?

  • Could we handle a $15,000 roof repair?

  • Would we feel trapped?

If the answer to any of those is no, the house is too expensive—no matter what the bank says.

 

9. How Smart Buyers Use This Model

The strongest buyers don’t max out. They leave margin.

That margin:

  • Reduces stress

  • Increases flexibility

  • Allows investment

  • Makes life better

In the Philly suburbs, the smartest buyers don’t ask “What can we buy?”
They ask, “What lets us live well?”

 

By Eric Kelley, Philadelphia Suburbs Realtor & Attorney