{
  "id": "rent-affordability",
  "version": "cc8ac5dc0e05",
  "status": "published",
  "name": "Rent Affordability Calculator",
  "question": "How much rent can I afford?",
  "summary": "Computes the most rent an income can afford under the 30% rule and a 36% debt-to-income limit, after debt payments and utilities, and the rent a landlord’s 40x income rule accepts.",
  "category": "finance",
  "subcategory": "mortgage-and-real-estate",
  "url": "https://www.acalculator.org/finance/rent-affordability-calculator",
  "markdown": "https://www.acalculator.org/finance/rent-affordability-calculator.md",
  "kind": "function",
  "method": "rent = min(0.30 × M − utilities, 0.36 × M − debts − utilities), with M = gross yearly income ÷ 12; a 40x landlord accepts rent up to the yearly income ÷ 40.",
  "assumptions": [
    "Housing (rent plus utilities) should be at most 30% of gross monthly income, the line above which HUD counts a household as cost-burdened.",
    "Housing plus other debt payments should be at most 36% of gross monthly income, Fannie Mae’s limit for manually underwritten mortgages, used here as a rule of thumb.",
    "The 40x rule compares the rent alone with the yearly income, as landlords do.",
    "These are rules of thumb, not a budget: savings, taxes, and living costs vary."
  ],
  "inputs": {
    "$schema": "https://json-schema.org/draft/2020-12/schema",
    "type": "object",
    "properties": {
      "income": {
        "title": "Gross income",
        "description": "Income before tax, per year (or per month with the switch), of everyone who will pay the rent.",
        "type": "number",
        "x-unit": "USD",
        "x-period": "year",
        "exclusiveMinimum": 0,
        "maximum": 1000000000
      },
      "debts": {
        "title": "Monthly debt payments",
        "description": "Car, student loan, credit card minimum, and other debt payments each month.",
        "type": "number",
        "x-unit": "USD",
        "minimum": 0,
        "maximum": 100000000
      },
      "utilities": {
        "title": "Utilities and renter’s insurance",
        "description": "What you expect to pay each month on top of the rent: power, heat, water, internet, and insurance.",
        "type": "number",
        "x-unit": "USD",
        "minimum": 0,
        "maximum": 100000000
      }
    }
  },
  "outputs": {
    "rent": {
      "label": "Rent you can afford",
      "description": "The most monthly rent that keeps housing within 30% of income and housing plus debts within 36%.",
      "format": "money"
    },
    "limit": {
      "label": "Limited by",
      "description": "Which rule sets the most rent: the 30% housing rule or the 36% debt rule.",
      "format": "text"
    },
    "rent30": {
      "label": "Rent by the 30% rule",
      "description": "30% of gross monthly income, minus the utilities.",
      "format": "money"
    },
    "rent36": {
      "label": "Rent by the 36% debt rule",
      "description": "36% of gross monthly income, minus the debt payments and the utilities.",
      "format": "money"
    },
    "rent40x": {
      "label": "Rent a 40x landlord accepts",
      "description": "The most rent for which the yearly income is at least 40 times the rent: the yearly income ÷ 40.",
      "format": "money"
    },
    "housing": {
      "label": "Rent plus utilities",
      "description": "The rent you can afford plus the utilities: your housing cost each month.",
      "format": "money"
    },
    "yearly": {
      "label": "Rent per year",
      "description": "The rent you can afford times 12.",
      "format": "money"
    },
    "monthlyIncome": {
      "label": "Gross income per month",
      "description": "The yearly income ÷ 12.",
      "format": "money"
    }
  },
  "defaultAnswer": {
    "inputs": {
      "income": 60000,
      "debts": 250,
      "utilities": 150
    },
    "outputs": {
      "rent": 1350,
      "limit": "30% housing rule",
      "rent30": 1350,
      "rent36": 1400,
      "rent40x": 1500,
      "housing": 1500,
      "yearly": 16200,
      "monthlyIncome": 5000
    },
    "text": "On a gross income of $60,000.00 a year, you can afford about $1,350.00 a month in rent."
  },
  "examples": [
    {
      "given": {
        "income": 60000,
        "debts": 250,
        "utilities": 150
      },
      "expect": {
        "rent": 1350,
        "limit": "30% housing rule",
        "rent36": 1400,
        "rent40x": 1500,
        "housing": 1500
      },
      "source": "hand calculation in content.mdx: 0.30 × 5,000 − 150; HUD User, Rental Burdens: Rethinking Affordability Measures (the 30% of income standard). https://www.huduser.gov/portal/pdredge/pdr_edge_featd_article_092214.html; Fannie Mae Selling Guide B3-6-02, Debt-to-Income Ratios (36%). https://selling-guide.fanniemae.com/sel/b3-6-02/debt-income-ratios"
    },
    {
      "given": {
        "income": 90000,
        "debts": 900,
        "utilities": 200
      },
      "expect": {
        "rent": 1600,
        "limit": "36% debt rule",
        "rent30": 2050,
        "rent40x": 2250,
        "yearly": 19200
      },
      "source": "hand calculation in content.mdx: 0.36 × 7,500 − 900 − 200; HUD User, Rental Burdens: Rethinking Affordability Measures (the 30% of income standard). https://www.huduser.gov/portal/pdredge/pdr_edge_featd_article_092214.html; Fannie Mae Selling Guide B3-6-02, Debt-to-Income Ratios (36%). https://selling-guide.fanniemae.com/sel/b3-6-02/debt-income-ratios"
    },
    {
      "given": {
        "income": 36000,
        "debts": 0,
        "utilities": 0
      },
      "expect": {
        "rent": 900,
        "rent40x": 900,
        "monthlyIncome": 3000
      },
      "source": "hand calculation in content.mdx: with no utilities the 30% rule and the 40x rule agree; HUD User, Rental Burdens: Rethinking Affordability Measures (the 30% of income standard). https://www.huduser.gov/portal/pdredge/pdr_edge_featd_article_092214.html; Fannie Mae Selling Guide B3-6-02, Debt-to-Income Ratios (36%). https://selling-guide.fanniemae.com/sel/b3-6-02/debt-income-ratios"
    }
  ],
  "sources": [
    "U.S. Department of Housing and Urban Development, HUD User, Rental Burdens: Rethinking Affordability Measures (the 30% of income standard, with utilities in housing costs). https://www.huduser.gov/portal/pdredge/pdr_edge_featd_article_092214.html",
    "Fannie Mae Selling Guide B3-6-02, Debt-to-Income Ratios (a maximum total debt-to-income ratio of 36% for manually underwritten loans). https://selling-guide.fanniemae.com/sel/b3-6-02/debt-income-ratios",
    "StreetEasy, How much rent can you afford? (the 40x income rule many New York landlords use). https://streeteasy.com/blog/how-much-rent-can-i-afford-in-nyc/"
  ],
  "related": [
    "rent",
    "debt-to-income-ratio",
    "rent-vs-buy",
    "budget"
  ],
  "changelog": []
}