It doesn't matter. People care more about the monthly payment than they do the debt #. You can afford a much higher debt burden if the interest rate is smaller.

For fun, assume you can afford $1000/month in housing costs. With a 30yr mortgage and 20% interest rate. How expensive of a house can you afford? What if interst rates dropped to 10%? 5? 2.5?

Very strong correlation with home prices over the last 40 years.