Is 40% of monthly income too high to spend on rent?

parkrunner

£900 a month left over for bills etc and a place you love is a yes from me.

getmore4less

lisyloo wrote: »

I think it's too high.
London is an exception where public transport is cheap, you might not need a car and long term job prospect might make it worth it.

Plenty of other places have cheaper public transport and jobs

lisyloo

getmore4less wrote: »

Plenty of other places have cheaper public transport and jobs

Of course, although there are very few places that are as well served with tube, buses, trams as London where you can virtually guarantee not needing a car (I've only hired a car once in 4 year and that was partly choice).


But other places don't have the jobs you have to take for a certain career. For example if you want to get into fashion design or be a hedge fund manager.


There are reasons why about loads of people commute into London everyday and it's not because they are too stupid to know other places are cheaper. For those people the job propsects (current or future) might justify the higher accomodation price.


It's a valid choice and unlikely to be because they don't know it's cheaper elsewhere in the country.


Speaking personally we pay a lot in rent for the high salary (which means chance to retire earlier) which more than justifies it but also we are making the best of it and having a great time (went to the Chelsea hospital on Sunday - really lovely).


My point wasn't to provoke anti-London sentiment but to point out that there may be valid reasons for busting an arbitrary budget.

datlex

lisyloo wrote: »

I think it's too high.
London is an exception where public transport is cheap, you might not need a car and long term job prospect might make it worth it.

Not too sure this is accurate. Can you get a month travel for £50?

lisyloo

datlex wrote: »

Not too sure this is accurate. Can you get a month travel for £50?

Of course it depends on where you live.


Cycling is £90 per year on the Santander bikes (or £2 per day) walking is free.
My partner walks to work and back so free.


£50 probably isn't realistic (not sure I said that, did I?), but how many cars are there you can maintain for £50 per month including servicing, mot, insurance as well as fuel and parking?


I certainly know that my transport in central London is much cheaper than maintaining a car outside and I have a very cheap Corsa.


But people don't go to London for the cheap transport.
They go because (for example) they want to do something in the creative industries that they can't do anywhere else.

We've been here before.
If your a teacher or a bus driver then I agree it isn't worth it, (although some people do have something called family ties).
But if you want to work in film, ballet, west end shows, hedge funds then you might find you need to go to London to follow your passion.


What's the issue with that if it makes sense for the individual in the long term?

silvercar

My son was paying half his take home pay in rent for the first 18 months in his (London) job. It is manageable, basically depends on what other costs you will have.

steampowered

As you will see from this article, tenants pay - on average - 27% of their income in rent. But that figure is 49% in London.

https://www.bbc.co.uk/news/business-42179119

40% of your income on rent is not unusual and is perfectly manageable. But, it does make it difficult to save.

I don't think that is a good idea long term. But it can be worth it if you are at the start of your career and can reasonably expect your salary to increase over the next few years. Or, if you have a particular reason to be renting somewhere expensive to develop your career (e.g. if you are living in London).