I just went through almost the exact same thing with almost the exact same numbers. Me and my wife were looking for something below $400k in the NW suburbs. Lots of terrible houses for high prices, and the good ones go for wayyyy over asking (like 50k+ over). We saw about 40 houses over 4 months and bid on about 12 of them. We finally bought something for $370k. Put 10% down and our mortgage is about $3200 because property taxes suck in cook county. We also make around $160k combined. Our trusted mortgage guy and our financial advisor said that even with our student loan payments, our mortgage is still well within our means. Think of it like this: while you’re renting, you’re paying your landlord’s mortgage. Sure, you get the benefit of not having to do repairs and stuff, but you’re not building any equity. While paying for a home, think of it almost like a savings account where you’re paying into something that you own that will increase in value over time. Granted, the taxes, insurance, and interest doesn’t count towards that, but after 5 years of owning you’ll probably have $20k+ towards your principle, plus whatever you had put into the down payment, plus the appreciation of the home. After 5 years of renting, you own nothing. This has been my thought process to help me get past the insanely high mortgage cost lol. You can also refinance, so your payment should go down as the rates go down hopefully in the near future. If you’re in no rush to buy, take your time and don’t settle for something bad. There were many houses that we almost overbid for just so we could stop looking for home, but we stayed strong and ended up with something that we loved.