As always, rental experts advise that you must spend simply 30% of your gross income on rent each year. That is your gross income, or your income before taxes and other deductions, not your take-home pay. So, for example, if you make $40,000 per year from all sources of income, your ideal maximum rent amount is $1,000 per month. This is a basic proposal to determine how much rent you can afford. There are a lot of other expenses that require consideration as well.
For instance, if you have several debts or have any type of large monthly payments that you won’t be able to change or reduce, these expenses should be included in your calculations. Above that, your budget should have a complete list of two types of expenses: fixed and variable. Food, transportation, medicine, utilities, and other necessary expenses should be added up in the “fixed expenses” category. Entertainment, vacation travel, and so on would go on the “variable” (a.k.a. optional) list. Once you figure out how much you’re spending, you can more freely come up with a realistic estimate of how much rent you can afford. In places where rents are exorbitantly high, it may be difficult to stick to the 30% rule. This may force you to minimize your other expenses to afford your rent better.
Of course, how much you think you can afford to pay is only one half of the equation. When looking for a rental home, some property management companies and landlords may have different ideas on what comprises a desirable tenant. Even if you can exhibit that you can afford the advertised rental rate, some property managers or landlords may still hesitate to offer you a lease for other reasons. Qualification criteria may include things such as past credit history, and whether or not you own pets.
For the best result, do your best to be truthful with the property manager or landlord and provide all requested information promptly and in full. It doesn’t hurt to ensure that you come early to all meetings and dress up a little, too. These may look like small things, but a satisfying first impression could make you influence a property manager that you will be a responsible and conscientious tenant.
Naturally, even with your best efforts, there are times that the rental house you crave is given to somebody else. If that ensues, try to stay positive and to do what you can to maintain or improve your financial situation. You may not appreciate why the property manager or landlord didn’t pick you, and it may not denote that you are not a perfect candidate for another property. As long as you are applying for rental homes that fall within your range of affordability, the right one for you should come along soon.
Are you in the market for a new rental home? If so, please check out our available listings and contact us if you find something that piques your interest.