I stand corrected, please forgive me. I'm afraid I was in a bit of a hurry when calculating sales price before, and took the taxes and insurance portion of the payment out before I worked the 6% interest rate formula backwards to get to loan amount. I will be more careful before I post a comment again.
Yes, based on your income only, you should be able to afford a loan of about $330K, if it is a 30 yr loan at 6% fixed interest (today's rate in our area). That would make your total house payment (PITI) approx. $1984 per month, which is 28% of your before tax income. Add your downpayment amount to this loan amount, and you have the sales price for a house you can afford.
BUT, as I said in my previous response, your OTHER long term monthly payments (anything with more than 10 monthly paments left on it) will come into play as well. If the total of all those other monthly payments is $570 month or less, you are good to go at this loan amount. There can be some flexibilty on both house payment and total monthly payments being somewhat higher, but your long term monthly payments can definitley affect the loan amount you qualify for, and that will affect the price of the home you can afford. I see it happen all the time!
Making $85K/yr., at age 24, I am guessing you have a pretty nice care (I would, if I were you). If you do, there is a good chance you have car payments of close to $500 (or more) per month. If that is the case, that doesn't leave you much wiggle room, with only $70 (or less) per month for all your other longer term monthly payments. If you have credit card debt, student loans, etc. $70 isn't much to cover them, so you really need to talk to a lender, and have your individual circumstances evaluated, to get anywhere close to an accurate idea of a house you can afford. Do it soon, and take advantage of the good prices that are out there now. I hope you find a great home, at a great price, and become a home owner in the very near future - you won't regret it.
To Hi - have you talked to a Realtor lately in your area of Virginia to find out the buying trends in the last 2 months? If you haven't, you should. Real estate is always localized ,and forming opinions on the market from generic information about the real estate market overall, can put you in a position of missing out on the best timing to get the best price. If your market is like ours, Buyer activity is way up!! This is due to really good home prices now, interest rates that continue to stay low, and a combination of other factors. Many houses are being bought NOW! This activity will begin to decrease inventory supply, especially in the most popular price ranges in your area, and since supply effects demand, and demand effects price - that could mean price increases in the near future. You need to talk to someone who is a real estate professional to see what is really going on with prices, and find out if you are as on top of the housing market as you think you are.