Rent Affordability Calculator

Where the 30% figure comes from

Thirty percent of gross income is a measurement threshold, not a rule anyone enforces: housing programs classify a household as cost burdened above it and severely cost burdened above 50%. No federal agency sets a limit on what you may spend, and no landlord is bound by the figure. It became a rule of thumb because it is the line at which, across large populations, other spending starts getting squeezed.

Gross income is the wrong denominator for your budget

The 30% test uses income before tax, which is convenient for statistics and useless for planning. At a $72,000 salary, 30% of gross is a rent of $1,800, but take-home might be $4,600 a month — so that rent is 39% of the money that actually arrives. The line above that measures rent against take-home is the one to look at, and above roughly a third of take-home the budget gets tight quickly.

The landlord test is a different question

Most screening asks for gross monthly income of at least three times the rent, which works out at 33% of gross — slightly looser than the 30% measure. It answers "will they rent to me", not "can I live on what is left". A rent can clear the landlord test comfortably and still be unaffordable once a car payment and student loan are in the picture, which is why this page subtracts your other commitments rather than ignoring them.

What the leftover line is for

Rules of thumb ignore everything specific about you. The figure for what remains after rent, utilities, debt payments and your savings target is the only one that reflects your actual situation — food, transport, insurance and everything unplanned come out of it. If that number is thin, the rent is too high no matter what the percentages say. If it is comfortable, a rent slightly above 30% of gross may be entirely sensible, particularly where it removes a commute cost.

Costs that arrive with the lease

Budget for the move as well as the month: first month's rent, a security deposit of one to two months, application and pet fees, and utility connection deposits. Where utilities are not included, heating in an older building can add a large winter figure that a summer viewing will not reveal — ask for twelve months of bills rather than an average. Renters insurance is usually required and is the cheapest line in the whole budget.

Frequently Asked Questions