1. What is the Rent Affordability Rule?

The 30% rent affordability rule suggests that tenants should spend no more than 30% of their monthly income on rent. This is a common guideline used by landlords and property managers to assess tenant affordability.

2. How Does the Calculator Work?

The calculator uses the simple formula:

Where:

• \( Rent \) — Maximum recommended rent payment
• \( Income \) — Tenant's monthly income before taxes
• \( 0.3 \) — 30% affordability threshold

Explanation: This calculation helps determine what rent amount would be considered affordable based on a tenant's income.

3. Importance of Rent Affordability

Details: Maintaining rent at or below 30% of income helps ensure tenants can comfortably cover all living expenses while maintaining financial stability.

4. Using the Calculator

Tips: Enter monthly income before taxes in your local currency. The calculator will show the maximum recommended rent payment based on the 30% rule.

5. Frequently Asked Questions (FAQ)

Q1: Is the 30% rule before or after tax income?
A: The standard calculation uses gross (before tax) income, though some landlords may consider net income.

Q2: Does this include utilities?
A: Typically this refers to base rent only. Additional housing costs like utilities may require a lower percentage.

Q3: Is this rule flexible?
A: In high-cost areas, tenants may spend up to 40-50%, though this increases financial risk.

Q4: How does Rightmove use this calculation?
A: Rightmove and similar platforms use affordability estimates to help users filter properties within their budget.

Q5: What if I have significant other debts?
A: With substantial debt payments, a lower percentage (e.g., 25%) may be more appropriate.