What proportion of income should be spent on rent?

Sigur_2

I've heard its around a third, but are there others who spend more than this?

Granted if you're a very high earning your calculations will be different to that of the average person. I'm talking average.

ginvzt

We are paying about 1/6th of our joint income on the rent. And then all the taxes, bills etc. I wouldn't say that our earning are high (we do pay basic income tax).

Sigur_2

How much do you pay? Is it over £500 a month?

lil_me

I wouldn't pay more than 1/3, never, 1/4 would be pushing it for me. Ours is currently £625 PCM

ginvzt

We are paying £550. Probably wouldn't pay more than £750 for a right place.

liz545

I'm currently paying just over 25% for my share of the rent (flatshare); OH spends closer to 33%, I think more than that and things start to feel stretched. Of course, this is in London so probably higher than the rest of the country.

phil_b_2

I spend 7.5% of my pre-tax monthly income on my share of rent.

Treadmill

30-40% max is sensible...

barnaby-bear

Sigur wrote: »

I've heard its around a third, but are there others who spend more than this?

Granted if you're a very high earning your calculations will be different to that of the average person. I'm talking average.

A different slant, the two main credit check agencies do affordability checks were number times monthly rent should be less than annual gross (pre tax) salary to determine whether to let.
n x (rent pcm) = salary is the max

the number n is 24 or 30 depending on the agency so if you earn £24k (might be joint) the two main agencies limit your rent to be 800 or 1000 depending on that number. I think these numbers are pushing it with bills if living alone....
http://www.ir35calc.co.uk/PAYE_NI_Net_Salary_Tax_Summary.aspx?uid=0&logon=False&psalary=24000&div=1&status=OutsideIR35&pyt=LimitedCompany&expenses=3000&other=0&pension=0&tc=603L&age=30&salary=6000&rate=25&rt=Hourly&rt2=Hourly&weeks=44&dwpw=5&dwpw2=5&hours=37.5&dni=3000&tty=2008&rate2=25&weeks2=44&hours2=37.5&status2=OutsideIR35&psalary2=50000&mir=0.055&ma=200000&mp=25&cid=0&vat=1&vi=False&cby=1&ar=1&gs1=0&gs2=0&gs3=0&gs4=0&nd=1&pbt=1&hpd=11&me=150&vt=Car&mpw=0&mpc=0&pt=Monthly&ace=500&mt=Parasol&wl=InsideLondon&uds=Basic&Host=LOCAL
says 24k is 1531 a month and with council tax c. 100, water, gas etc 1k rent would be pretty tight

poppy10_2

I pay about 20% of take-home pay on rent. A mortgage on the same property would cost double that.

Treadmill

poppy10 wrote: »

I pay about 20% of take-home pay on rent. A mortgage on the same property would cost double that.

I currently pay £220 a month mortgage, it would cost about £650 a month to rent my house, which is nice as I'll be renting it when I move.