How Much Mortgage Can I Get Based on My Salary? Common Myths About Hourly Pay and Overtime

When you’re looking to buy a home, one of the first questions is “how much mortgage can I get based on my salary?” The answer depends on your income, but many people misunderstand how hourly pay, overtime, and bonuses affect mortgage affordability. This article clears up common myths using the latest UK earnings data.

Myth 1: Your hourly rate directly determines your mortgage offer

It’s easy to think that a high hourly rate means a high mortgage, but lenders look at your stable annual income. According to the ONS Annual Survey of Hours and Earnings (ASHE), the median gross annual salary for full-time employees in April 2025 was £39,039. That’s based on median weekly earnings of £766.60 and median hourly earnings (excluding overtime) of £19.67.

If you’re paid hourly, your annual salary is roughly your hourly rate × contracted hours per week × 52 weeks. For example, at the National Living Wage of £12.21 per hour (April 2025 rate for ages 21+) and a 37.5-hour week, your annual base pay would be about £23,809.50. But lenders will use this figure, not your hourly rate alone, to calculate affordability. They typically offer 4 to 4.5 times your gross annual income.

Myth 2: Overtime always boosts your mortgage borrowing

Many workers rely on overtime to increase their take-home pay, but mortgage lenders treat overtime cautiously. If your overtime is guaranteed (e.g., contractually required), it may be included. However, most lenders average non-guaranteed overtime over several months and may discount it if it’s irregular. The ONS data shows that median hourly earnings exclude overtime, meaning base pay is the core measure. For mortgage purposes, your base salary is king.

Myth 3: London weighting guarantees a higher mortgage

Jobs in London often include a “London weighting” allowance to cover higher living costs. While this increases your gross pay, lenders may not treat it the same as base salary. For example, NHS pay scales for 2026/27 include Higher Cost Area Supplements (HCAS) – up to 20% of basic salary with minimum and maximum payments. But if the weighting is not guaranteed for the full mortgage term, lenders might only count part of it. Always check with your lender how they view location-based allowances.

Myth 4: Hourly and annual pay are interchangeable

Converting an hourly rate to an annual salary is straightforward: multiply by hours per week and 52 weeks. But this assumes you work the same hours every week with no unpaid leave. In reality, many roles have variable hours, unpaid overtime, or seasonal fluctuations. The NHS Staff Earnings Estimates for June 2026 show mean annual basic pay per full-time equivalent of £44,457, but that includes contracted hours and may not reflect actual take-home pay after deductions. Use our Hourly to Salary tool to get a rough estimate, but always check your contract.

Myth 5: Bonuses and commission are counted fully

If you earn bonuses or commission, lenders often average them over 2–3 years. They want to see consistency. A one-off bonus won’t significantly increase your mortgage offer. Similarly, tips and gratuities are rarely considered unless they are declared on your tax return and appear regularly on payslips.

How to calculate your mortgage-affordable salary

Start with your base annual salary. If you’re hourly, use the formula: annual ≈ hourly rate × contracted hours × 52. For a 37.5-hour week at the median hourly rate of £19.67, that’s about £38,356.50 – close to the ONS median of £39,039. Then apply a typical lender multiple of 4.5x to get a rough maximum mortgage: around £175,600 on that salary. But remember, lenders also consider your outgoings, credit score, and deposit.

For more detailed salary benchmarks, see our salary data page, which includes median earnings by region and occupation from ONS ASHE.

The bottom line

Understanding “how much mortgage can I get based on my salary” means looking beyond your hourly rate. Focus on your stable, guaranteed annual income. Overtime, bonuses, and allowances may help but are not guaranteed. Use official sources like ONS ASHE and GOV.UK National Living Wage rates to benchmark your pay, and always speak to a mortgage advisor for a personalised assessment.

Disclaimer: Hourly-to-salary figures assume a steady contracted week with no unpaid overtime, bonus, tips or salary sacrifice. Actual pay depends on rota, holiday pay method, London weighting and overtime rules. Always check your contract and official GOV.UK guidance.