Before beginning to search for a rental home, it is critical for you, as a renter, to know how much rent you can afford. Examining your household budget in great detail is the most efficient strategy for determining exactly how much rent you can afford. By obtaining accurate income and expense numbers, you will be able to search for a rental home with greater assurance, selecting one that is suitable for your lifestyle and finances.
During your rental home search, it is important to maintain a flexible mindset and keep your options open. This is because several property management companies offer a wide range of rental properties, each with its own unique characteristics and variants.
Assess your monthly income and expenses
Generally, rental experts advise that you should be spending no more than 30% of your gross income on rent yearly. That is your gross income before taxes and other expenditures, not your take-home pay. As an illustration, if you gain $40,000 yearly from all sources of income, the perfect maximum rent amount is $1,000 per month.
It goes without saying that this method of figuring out how much rent you can afford is somewhat oversimplified. Other expenses are frequently incurred, and it is necessary to take them into mind.
As an illustration, if you have a lot of debt or make large monthly payments that you are unable to alter or lessen, these expenses should be included in your calculations. Also, your budget has to include a detailed list of two types of expenses: fixed and variable. Food, transportation, medicine, utilities, and other essential costs should be added to the “fixed expenses” group. Entertainment, vacation trips, and other comparable activities would go on the “variable” (a.k.a. optional) category.
After you have determined how much you’re spending and where, you can more easily come to an accurate estimate of how much rent you can actually afford. Sticking to the 30% rule in areas with high rent may be hard. This may require you to change some other expenditures to better afford your rent.
How to approach landlords or property managers
Of course, how much you believe you can afford to pay is only one part of the issue. When applying for a rental home, several property management companies and landlords will have varied notions about what constitutes a suitable tenant. Even if you can demonstrate that you can afford the advertised rental rate, some property managers or landlords may be apprehensive about offering you a lease for a variety of reasons.
Regardless of your best efforts, there is a possibility that the rental home you desire is leased to someone else. In circumstances like these, it’s necessary to stay positive and continue to manage or improve your financial situation. Bear in mind that the fact that you were not selected for a certain rental home doesn’t automatically imply you’re not a strong candidate for another property. As long as you’re applying for rental homes within your affordability range, you will eventually find the one that is perfect for you.
Are you interested in finding a new rental home in St George or nearby? Real Property Management Southern Utah can be beneficial! Browse our available listings and get in touch with us if you have any questions.
Originally Published on Jan 10, 2020
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