It can be difficult to know how much you should be paying for rent each month. However, it is important to know that landlords often have a very cut and dry estimation of how much they want tenants to earn in order to feel comfortable about knowing that tenant can afford their monthly rent amount. This information can help make your housing search more efficient by keeping your search within the correct rent range. Below are a few steps you can take to figure out how much you should be paying in rent each month.
Step 1 – Calculate your monthly income.
This can be difficult if your income isn’t always stable, so just do your best to average your monthly earnings. If you get paid twice a month, or once a week, add up your recent paychecks from the last few months and get an average monthly income amount.
Step 2 – Divide your monthly income by 3.
Landlords typically want tenants to spend about a third (1/3) of their income on rent. Keep in mind that this isn’t the case with every landlord. Talk to a landlord about an income requirements they may have for successfully securing a lease to learn more about specific landlords you encounter!
Step 3 – Broaden your result and start searching!
If your income is $1000 per month, your result from step 2 should be “$333″ – keeping in mind that this number is not an “absolute maximum” in the eyes of landlords, try to broaden your search to between $300 and $450 (or whatever you personally feel comfortable with) and try to find units in that price range. This will ensure that you don’t waste your time looking for units you can’t afford.
After the guide, if you would like to know more, you can sign up for a free webinar here! (What’s a “webinar”?)