Rent affordability calculator

HappyMJ

Li0nhead wrote: »

Just found one of these.
Anyone agree with it?
http://www.cliftonandco.co.uk/lettings/affordability-calculator

Never rented before an am looking to. If its a true reflection then i can afford higher than i have been looking at (going to still to my current budget even after reading).

Seems a little on the high side according to it i can afford roughly property £100PM above what i am looking at and I am looking at the lower end of the market so its a big percentage jump.

No it is not a true reflection of what you can afford.

They have used a minimum of 30 times the rent. That's OK for middle income earners but the calculation fails for low income earners and fails for high income earners.

I'll explain. Everyone needs £67.50 a week to buy food and pay basic bills it's the JSA amount. That would say that someone earning rather than claiming £67.50 could afford monthly rent of £117. That is impossible yet they would get housing benefit and afford much more.

On the other hand someone a professional university graduate earning £60,000 and pays tax, NI and a student loan would have after tax income of £3,113 and according to the calculator could afford rent of £2,000 a month. If that person has a partner and 3 children then there is no way they could afford to pay that much rent and survive comfortably on £1,113 per month.

Personally I would figure out what you would get if you were on benefits....single people get £67.50 a week plus free housing. Couples get £105.95 a week. Then I would deduct that from your NET salary then divide the remaining figure by 2 and that is what you can comfortably afford and have a lifestyle relative to your salary. i.e someone earning £60,000 I would expect someone to have a nice car yet I would expect someone on benefits or minimum wages to get the bus.

Li0nhead

HappyMJ wrote: »

No it is not a true reflection of what you can afford.

They have used a minimum of 30 times the rent. That's OK for middle income earners but the calculation fails for low income earners and fails for high income earners.

I'll explain. Everyone needs £67.50 a week to buy food and pay basic bills it's the JSA amount. That would say that someone earning rather than claiming £67.50 could afford monthly rent of £117. That is impossible yet they would get housing benefit and afford much more.

On the other hand someone a professional university graduate earning £60,000 and pays tax, NI and a student loan would have after tax income of £3,113 and according to the calculator could afford rent of £2,000 a month. If that person has a partner and 3 children then there is no way they could afford to pay that much rent and survive comfortably on £1,113 per month.

Personally I would figure out what you would get if you were on benefits....single people get £67.50 a week plus free housing. Couples get £105.95 a week. Then I would deduct that from your NET salary then divide the remaining figure by 2 and that is what you can comfortably afford and have a lifestyle relative to your salary. i.e someone earning £60,000 I would expect someone to have a nice car yet I would expect someone on benefits or minimum wages to get the bus.

Excellent post thanks. Using your plan I get a figure not too much higher than the propertys i was looking at initially, So my own estimate was in the right ball park of figures to look at.

drummer_666

ignore the calculator. do you own budgeting.

you know what you are happy with having left over to spend on your social life.

you know how expensive your car is to run and get to work etc

Li0nhead

drummer_666 wrote: »

ignore the calculator. do you own budgeting.

you know what you are happy with having left over to spend on your social life.

you know how expensive your car is to run and get to work etc

Correct no doubt, just was looking at ball park figures.

jaxjax123

apparently we could afford £1100 but we struggled to get a mortgage for £440. I just don't how they work all this out.