<prompt> Human: My wife and I are looking into buying our first home. We have rented for years we are in our early 30s and we think its time.What is a good equation to figure out how much you can afford? For example, should we take a of our yearly income and put that number towards a mortgage? What about taxes? Is there a good way to think of it like X Y - Z House?  <response>: A great rule for ome mortgages is the 2836 rule.So no more than 28 of your yearly income should be used on housing. This includes you mortgage payments, home owners insurance, lawn care, etc. And no more than 36 of your total income on debt service.So if housing expenses are exactly 28, then your car loans, utilities, etc. should be no more than 8 of your total income.so that 28836This is just a rule of thumb. 30 on housing would be fine. Its just the ideal you want to go for. 