How Much Rent Can you Afford
Rental Property September 3, 2018

How Much Rent Can You Afford?

It’s easy to find your dream new crib online – the bathroom’s a serious upgrade and you can already see yourself enjoying a cold brew on the sunny deck. But it’s also easy to get carried away with a dream you might not be able to afford! Use our handy guide to work out how much rent you can really afford.

There is no hard and fast rule, but some suggest your rent shouldn’t be more than a third of your weekly income (after tax). So if you bring home $500 a week after taxes, your weekly rent shouldn’t be more than $165. But everyone’s situation is different, so it’s important to consider other weekly expenses too!

Here’s how to calculate how much rent you can safely afford each week:

1. Work out your total weekly income, after tax. Often tax is already taken out of your pay before it arrives in your bank account, so if you are paid weekly, this would be the amount you see in your bank account each pay.
If you are paid fortnightly, simply halve the amount to calculate a weekly amount.
If you’re paid monthly, take the amount you receive, multiply by 12, then divide that number by 52 to calculate a weekly amount.

2. Divide your total weekly income by three to get an idea of how much rent you can afford (eg. $500 divided by 3 = $166)

3. Add up all your other weekly expenses (including bills, food, entertainment, petrol – anything you regularly see when you look at your bank statements! Yes, that includes the sneaky KFC trips)

4. Calculate your total expenses from step 2 and step 3. If your total expenses are more than your weekly income, you’ll need to consider lowering the rent or the expenses if you want to break even.


When choosing location, all those things like accessibility to shops, public transport and amenities nearby are important of course. But it’s also worth considering transportation costs – some areas might be more expensive in rent but mean you’ll save in petrol, parking and commuting time.

Budgeting for the move

When it comes time to move, rent isn’t the only financial worry – moving is expensive too! You need to rustle up bond, rent in advance, and sometimes letting fees all in a hurry. And sometimes before you’ve received your old bond back.
Based on the average rent of a 3 bedroom in Auckland at $550, moving costs might look something like this:

Rent in advance (2 weeks) $1,100
Letting fee (1 week +GST) $632
Bond (4 weeks) $2,200
Total $3,932

With MoveSmart you can move now, and pay off these costs in your own sweet time!