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What is the recommended percentage of salary be spent on rent?

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  • 28-11-2011 10:48pm
    #1
    starlit
    Registered Users Posts: 12,342 ✭✭✭✭


    Quick question, what would be the recommended percentage of salary spent on rent?

    Anyone any idea what is the 'real' recommended percentage as the ones in mind vary and not sure if they are a bit OTT or under par?

    I have looked online and it throws up various percentages such as 20%, 25%, 30%, 33%, 35% even 50% but not more than that, and rule of thumb being 1/3 of salary. What is the correct percentage be spent on rent?


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    #2
    brianwalshcork
    Registered Users Posts: 607 ✭✭✭brianwalshcork


    I don't think that anyone can tell you how much you should spend on rent - that will be decided by your wages. If you earn lots, then there's no point in paying 30% of your salary for a penthouse apartment somewhere if what you actually want is a houseshare with a couple decent people that you can watch tv / go fir a beer with.
    Likewise, if you don't earn lots, you might get a place that hits the 30% mark but is no where near where you want to work or live.
    Obviously dont't spend 0% cause living on the street isn't fun and don't spend 100% either.... Somewhere in the middle that gets you a place that fits your needs is what you should be aiming for!


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    #3
    starlit
    Registered Users Posts: 12,342 ✭✭✭✭starlit


    I be looking into living on my own if ever I decide to move up to Dublin again though and being close to the city but within an easy commute. Close to shops and transport routes too. All within walk-able distance from potential accommodation. It be an apartment or town house I be keen on though.

    Ya what ever fits my needs, just enough to pay for rent, groceries, transport and bills and the odd luxury/night out/cinema and other general stuff too household and toiletries and the likes.

    I'd be aiming to go between 20%-50% aprox or in between around the 25-35ish%. Like if I am earning less than 30k would €850-€1300 be within an affordable budget with the added cost of bills and groceries? Depending on location of accommodation and whether it be a one or two bedroom place.


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    #4
    Victor
    Registered Users Posts: 78,333 ✭✭✭✭Victor


    Have a look at these polls: http://www.boards.ie/vbulletin/showthread.php?t=2056399233


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    #5
    the groutch
    Closed Accounts Posts: 16,096 ✭✭✭✭the groutch


    there's no "correct" percentage, as there are a million different variables, but personally I'd definitely set a limit of 40% regardless of how nice a place is.


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    #6
    starlit
    Registered Users Posts: 12,342 ✭✭✭✭starlit


    Ya I was looking over the polls and it got be thinking that I could settle for less than €1,000 a month for a one or two bedroom place, a decent apartment or town house, decent location close to shops/public transport.

    If its nice ya great but shouldn't always have to matter if I like the place and has what I need and near shops/public transport I be happy to fork out less than €1,000 but if it happens to be the perfect place whether modern or a little dated that I could afford and have a reasonable standard of living not far from the city close to shops and public transport, nice place, then I would be willing to go between €1,000-€1,200.

    40% is a fair bit off a salary though. I wouldn't go more than 50% but not less than 20% of a salary to pay for rent. I have to take into consideration the length of time I be likely to be in Dublin. If less than a year I wouldn't be fussed on a place but more than a year I might be.

    I'll take everything on board thanks guys!


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    #7
    kmcattack
    Registered Users Posts: 65 ✭✭kmcattack


    I'm not sure how you could afford that kind of rent on a salary of 30k? I'm earning just under 30k and if I had to pay over 1000 for rent each month that would be around 50% of my income after tax.

    As it is I pay 600 a month and am relatively comfortable but personally anyway I would never be able to afford that rent with the cost of living in Dublin, etc!

    Good luck!


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    #8
    Danbo!
    Closed Accounts Posts: 3,942 ✭✭✭Danbo!


    When people are talking about their salary vs rent I assume they're referring to their own portion of the rent yeah? Personally being on less than 30k I would look at max 500 a month and my OH the same so total would be 1000. We'd also look to save 500 each tho and use the rest of salary for bills, etc.


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    #9
    awec
    Administrators Posts: 53,556 Admin ✭✭✭✭✭awec


    I must be doing something wrong or getting taxed to high heavens if someone on less than 30k is able to afford a grand a month in rent :(


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    #10
    starlit
    Registered Users Posts: 12,342 ✭✭✭✭starlit


    I haven't moved back to Dublin yet just weighing out my options and seeing what amount of rent would be feasible as I be living on my own not much responsibility other than bills and wanting some extra spending money on the odd spend on luxuries and going out!

    Just wondered how much I could spend on rent and still have a reasonable standard of living with aprox 30k a year.

    When I was last in Dublin I was paying €750 a month in and around earning 30k a year. I had no problems paying bills and other essentials. It was my first time moving home and living away from home and moving to Dublin so bought a couple of stuff to make it feel like a home the apartment I were in. So won't be needing to buy much to make a place call home next time round as I was living in another city previously.

    So will try not to bring too much but enough to keep the place afloat but would be looking for a place that is already furbished to a degree so I would imagine I be paying a little bit more for that a month.

    What areas be worth considering being a close proximity to the city by public transport? I might not have a car with me you see.

    Was thinking rathfarnham, donnybrook, rathmines, charlemont, rathgar, blackrock, booterstown, stillorgan, ballinteer, knocklyon, dundrum, milltown, sandyford, leoparstown maybe goatstown/churchstown?


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    #11
    awec
    Administrators Posts: 53,556 Admin ✭✭✭✭✭awec


    I can only speak for Sandyford but it's a quiet enough area, and only 20 minutes on the Luas into town.

    I'm talking about the industrial park area there, with the beacon apartments, south central apartments etc.

    Anywhere on the luas is handy enough depending on how long you'd be willing to travel. I think sandyford is about half way along the green line nowadays so if you go furthest away it's about 40-45 minutes.

    I am biased as I am currently looking a place to live in Sandyford too! :D


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    #12
    Monife
    Registered Users Posts: 3,014 ✭✭✭Monife


    awec wrote: »
    I must be doing something wrong or getting taxed to high heavens if someone on less than 30k is able to afford a grand a month in rent :(

    I earn 24k (before tax :() and I pay €750 a month for rent. I couldn't actually find anywhere liveable for less than that. That is for a 1 bedroom by the way in North Dublin City (close to Malahide Road). Really wish rents would drop!


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    #13
    awec
    Administrators Posts: 53,556 Admin ✭✭✭✭✭awec


    How do you afford that?!:eek:


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    #14
    Monife
    Registered Users Posts: 3,014 ✭✭✭Monife


    awec wrote: »
    How do you afford that?!:eek:

    I manage. It is almost 50% of my monthly wages. My only other outgoings are Airtricity, Cable TV & Internet (40 squids), Petrol (70 per month), phone (20 per month) and food. Have just started saving 15euro per week to the credit union. Not much, but it is doing me grand :)


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    #15
    Zamboni
    Registered Users Posts: 4,305 ✭✭✭Zamboni


    Monife wrote: »
    I manage. It is almost 50% of my monthly wages. My only other outgoings are Airtricity, Cable TV & Internet (40 squids), Petrol (70 per month), phone (20 per month) and food. Have just started saving 15euro per week to the credit union. Not much, but it is doing me grand :)

    I did something similar about 11 years ago.
    It is a massive regret for me.
    Move into a houseshare and channel that crazy rent into savings.


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    #16
    Monife
    Registered Users Posts: 3,014 ✭✭✭Monife


    Zamboni wrote: »
    I did something similar about 11 years ago.
    It is a massive regret for me.
    Move into a houseshare and channel that crazy rent into savings.

    I have house shared during college and it is just not for me. Hated it. Plus I am living with my OH now and he recently got let go but is not entitled to the dole as he didn't satisfy the habitually resident thing. Things will pick up soon, we are hoping, when he can find another job. Then the bills will be shared and we can lob more into savings :)


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    #17
    Kai123
    Registered Users Posts: 249 ✭✭Kai123


    Zamboni wrote: »
    I did something similar about 11 years ago.
    It is a massive regret for me.
    Move into a houseshare and channel that crazy rent into savings.

    I'd recommend a house-share, even if its the last thing you want to do. I live with my landlord and its a massive pain. Having lived on my own before, I miss having the space to myself. The experience is compounded by the fact that my landlord is a psycho.

    I am constantly looking for somewhere to rent in D15, but there are rarely any one-bedrooms. The ones that have come and gone are almost 50% of my wage. When things are really bad I think "feck it, I'll rent a 2-bedroom just to keep my sanity" but at this point its been 8 months since I moved into the apartment. I can save a huge amount each month, so each month is a small victory.

    Imagine if you moved into a house-share with really nice people? I know people who lived in house-shares for decades because its just cheaper. If you get on with the people and you trust them, but people also keep to themselves, its a great situation to be in.


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    #18
    pwurple
    Closed Accounts Posts: 12,449 ✭✭✭✭pwurple


    If you are wondering in terms of stress testing a mortgage, banks assume you leave 500 per person spending money after bills, including rent.

    So, throw a couple of children into the mix, and maybe a husband or wife who stay at home to mind them all, then you apparantly need 2000 euro after rent and utilities.

    So the calculation is your net monthly income, less 500 per person for food, clothes etc, less bills... And that's your max rent.


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    #19
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,280 Mod ✭✭✭✭The_Conductor


    If this is still an issue- please open a new thread. Thankyou.


This discussion has been closed.
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