Has residence in the United States become unaffordable? Journalists have been penning down articles to expose the frolicsome characteristic of the American housing economy. A 2017 report stated that about 40 million countrymen resided in housing spaces they couldn’t afford. Similarly, statistics from last year have revealed that almost 50% of Americans don’t earn enough to afford a one-bedroom apartment due to the country’s fluctuating economy.
Many homeowners are concerned about learning how much they should spend on renting an apartment. Let’s show you how to calculate your rent and avoid overspending on your housing situation. Read our below-mentioned tips carefully.
The ’30 Percent Rule’ Enigma
“How much should I spend on renting an apartment?” You may have searched this question before and got an oft-repeated answer: the ’30 percent rule’! This principle dictates that one mustn’t spend more than 30% of their monthly income renting an apartment.
That’s how you’ll have enough for paying bills, buying groceries, and getting non-essential supplies for home. This guideline originated in the 20th century – specifically after the National Housing Act of 1937. However, a nearly century-old rule cannot serve as a guideline for today’s homeowners. The ‘30% rule is obsolete since it ignores your entire financial condition. As a result, we recommend that consumers choose another choice.
Experts recommend following the 50/30/20 rule, which states that you should spend 50% of your income on necessities and 30% on non-essentials. Meanwhile, the rest goes for savings! Homeowners should use the rent calculator from apartments.com to find how much they should spend on rent per their monthly income.
This ‘affordability calculator’ helps folks keep their apartment affordable without overwhelming the annual budget! Remember that the principle about spending only 30% of your income on rent is also valid under ordinary conditions. However, homeowners should still implement some strategies to ensure their apartments are affordable. Here’s how you can keep the rent under 30% this month:
Rent in Winter
Landlords struggle to find pleasing occupants during the winter season, so homeowners can leverage this factoid to find affordable housing situations. Why does rent increase in summer? It’s because college students are flooding the housing market in the middle of the year. But winter makes landlords desperate to find tenants. So, make sure that you’re looking for a room when it’s snow there!
Split Your Rent
Having roommates doesn’t just save you from the constant boredom of living alone. But it also helps you afford your rent and bring down the cost of living in an expensive apartment for everyone in the group. We strongly suggest you give this idea a thought and invite some folks to become your “roomies.” It is a straightforward strategy for making an apartment easily affordable.
Rent Smaller Units
Some folks prefer living alone, so we suggest they search for smaller places to reduce the rent. So, find a place where you may reside comfortably without the luxury of having a spacious apartment.
A person can always transform even a modest habitat into a well-furnished dwelling! We believe folks can afford the rent by leasing small-sized living quarters to keep it under the necessary 30%.
Try Remote Working
Some people also prefer working remotely so they may afford a luxurious apartment. You can make your working situation home-based to move out from high-priced locations and relocate to a more affordable area. During the COVID pandemic, many individuals switched to remote work. They don’t have to spend too much money on public transport. That’s how the rent is reduced.
Get Renter’s Insurance
Obtaining renter’s insurance may seem expensive, but it can help people save money when disaster strikes. Consider it like an investment that keeps you financially well-prepared for accidents that can happen in the future. For instance, you may replace your lost items using the renter’s insurance. Therefore, a person shouldn’t neglect the importance of getting their valuables insured now.
Consider Another Location
If your rent still exceeds 30% of your monthly income, it’s time to move. Relocate to an affordable and tenant-friendly place where you can reside without worrying about the next month’s rent! Ask your friends/family for recommendations about an affordable location where landlords are not bitter about the rent. So, you can find yourself a suitable location to live in without worrying.
Consider Private Rentals
Individuals instead of corporations own these apartments, so these family-owned areas are more flexible regarding tenants’ affordability. Homeowners may negotiate fairer prices with these self-reliant landlords. We suggest you stay upfront about your financial planning problems while talking to the landlord. That’s how you can find a fine housing situation in this economy.
Cut Needless Subscriptions
Do you need cable TV anymore in 2022? Cutting the cord isn’t just fashionable today but lets several homeowners live in their apartments cost-effectively. You should seriously consider cutting needless subscriptions to save money for the next month’s rent. A house is what you need the most, and the internet can always keep you entertained. So, unsubscribe and stop spending on frivolous stuff.
Apartments contain 39 million Americans today. In other words, every 8th American resides in condos in the 21st century! The country’s already facing a shortage of apartments, and homeowners encounter the rise of expensive housing arrangements today. The ’30 percent rule’ states that folks should never spend more than 30% of their monthly income on housing expenses.
Surveys show that homeowners spending more than 30% on an apartment are often cost-burdened! But these surveys were conducted in the ’80s, and they don’t reflect the housing economics of the 21st century. We suggested homeowners try affordability calculators available online to estimate how much they can spend on rent today.
Also, we shared some tips to ensure you don’t spend more than 30% of your monthly budget on renting a living space. Consider getting a roommate so you two may split the rent. Move to another location, and you can rent small-sized apartments. Also, private rentals are cost-effective for low-budget households. Don’t forget to get your renter’s assurance and cancel all needless subscriptions so you can have money to pay the rent.
Moreover, we suggest that homeowners try remote working to avoid spending too much on transportation. Rent a room in the winter as landlords seldom find tenants when it’s freezing outside. That’s how you can finally save money to pay for your apartment in this COVID-infected economy.