To buy the house under the income tax, I would have to earn 667,000. (25% effective rate)
To buy the house under the nrst, I would have to earn 554,000.(17% effective rate).
Sorry Rob, you can't ignore the reduction in purchasing power caused by the income tax here.
When you buy the $460k house ($500k now) you will pay the full FairTax rate and you will have to borrow enough money to pay for the house and the FairTax together. Since for most people the purchase of a house is more than their annual income by a bit, so your comments about 17% effective FairTax are even more bogus than they normally are.
With a 41.8% FairTax rate, the $460k home will be $649.5k