What % of income should rent be, realistically?

[Laura4363]

I’m seriously worried about making ends meet lately, due to a recent change in circumstances. I was thinking of finding a smaller property to rent, as I now in theory have more bedrooms than I need and so don’t get much help from UC - I do work but only 24 hours p.w. so get a small UC top-up. I saw a house today that was £875 pcm, but in the details it said annual income must be at least £29K. I pay more than that now and earn a lot less! I’m worried that if I did find somewhere cheaper there’s no way I would pass any financial checks, as on paper I can’t afford to live - I’m not even sure how I am managing now to be honest. I did have some savings, but they’ve gone since my change in circumstances.

I saw an article today giving advice to a young person planning to leave home. It said they couldn’t afford the place they wanted as the rent was 30% of their income and that wasn’t sustainable. My rent is around 70% of my income.

For clarification, I have children who visit every other weekend, so I do need at least 1 bedroom. So a bed sit or house share isn’t feasible. And although I originally took a part time job when my children lived with me, I don’t think I could cope with a full time job at the moment, either mentally or physically - I’m old, tired, and coping with a flare up of depression due partly to a recent bereavement and other factors.

I don’t even really know what I want from this post! I guess I’m just after some examples of other’s experiences.

My rent is about 65% of my take home pay currently, although due to go up again next month. I can't get cheaper without changing my entire life so have to just make do. Irritatingly, my rent is much more than a mortgage would be, but obviously I can't afford to save a deposit and I'm too old really now to get a mortgage anyway. It sucks.

Percentage on its own isn't helpful as 30% of a low amount would leave less left over for other things than say 50% of a much higher salary.

Then you have to account for the fact that someone on a lower income could be entitled to UC which would skew the calculation.

Plus what are other expenses? If you can rent somewhere in walking distance from work and other main amenities so you don't need to spend much on transport and are only needing to feed yourself most of the time your outgoings will be a lot lower than someone who needs to pay for commuting, feed a family, have childcare costs etc. Do you need to pay maintenance for your DC?

Plus things like running costs need to be factored in. How much is the council tax, water bill, heating costs? A modern new build should cost a lot less to run than a period conversion with high ceilings, single glazing and crappy electric heating.

Maybe put together a budget for your circumstances considering all other costs including annual and irregular ones, and an estimate what UC you'd be entitled to so you know and can demonstrate what you can afford?

Is there any chance of social housing? If you're over 50/55 sometimes there's more availability of age restricted properties but I don't know if this would allow your DC to stay over? It might do if its literally only a couple of nights a month and they're well behaved, not noisy etc.

The financial affordability checks for private renting are quite tough.

I've seen things saying annual income should be 30 times monthly rent which would give rent as 40% of income.

In my experience grads in shared houses for example are paying more than 40% especially in London.

People on lower incomes are usually paying more than 40% as well.

With housing costs as they are, I don’t think the 30 percent is realistic anymore. Even if you take home £3000 net after tax this would give you a thousand pounds to rent which in a lot of places doesn’t get you much and£3k take home is a lot!

I agree with a poster above - you u have to see what you would have disposable after rent and ALL bills such as council tax and electricity and such things and then see where that takes you. If you have a new Range Rover on Finance it will be more difficult than if you drive an old fiesta!

When I worked, my rent was about 40% of my income... but then the CoL was lower then too.

My partner pays 700 gbp rent

His net income is 2k a month

I don’t know but my rent is about 20% of my income