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How much rent can I afford?


How much rent can I afford?

If you’re like the one-third of Aussies who rent, you might be wondering - how much rent should I be paying? Here’s some tips to work out what you can afford and ways to avoid rental stress.

What percentage of my income should go to rent?

The average weekly cost of rent in Australia’s capital cities is $460 for a house and $447 for a unit. But the average isn’t necessarily the right number for everyone. To figure out how much cash you should be spending on rent, try using one of these rent-to-income ratios.

The first one is the 30% rule. That’s where you spend no more than 30% of your income on rent. So, if you're earning $1,000 a week, you’d want to spend around $300 on rent. Pretty simple, right?

The other one is the 50/30/20 trick. Again, if you’re earning $1K a week $500 would go to essentials like rent, food and bills. $300 would be for fun stuff like dinner with mates, a gym membership or a new outfit. Then the last $200 would be for your savings.

Pro tip: Setting up multiple
USave savings accounts could help when you’re allocating money for regular expenses. Plus, if you link a USpend transaction account, you could earn bonus interest each month.*

Ways to avoid rental stress

If you’re spending more than 30% of your income on rent, you could be in rental stress. While you might not have full control over the amount of rent you pay, here’s some ways to lighten your load.

  1. If you like being around others, having flatmates could help share the costs. There’s apps like Splitwise which make divvying up household expenses like electricity, internet (and toilet paper!) super easy.

  2. Negotiating a better deal with your landlord could also be an option. If you’re a good tenant but seem to be paying more than your neighbours, asking your real estate agent to lower the rent could pay off.

  3. Moving to a place just a few suburbs over is another way you could cut costs. But if you want to stay local, downsizing might be the answer. Got a second bedroom that barely gets used? Switch to a one bedder and save.

Other ways to cut costs

If your rent is still more than 30% of your income, here’s some other ways to save around the house:

  • Search buy-and-sell sites for pre-loved furniture when decking out your home
  • Compare quotes for power, internet and contents insurance
  • Search the supermarket for discounts or head to your local markets for cheaper (and fresher) food
  • If you’re in an apartment building and have an unused parking spot, rent it out for some extra cash. Just run it past your landlord first.

These extra savings might even help you kick start an emergency fund. Prepping a plan B could help you cover costs if your partner or flatmates decide to move out.

Ultimately, how much you spend on rent is up to you. Use a rent-to-income ratio to figure out what you can afford and if you’re still feeling the pinch, our savings tips could help you avoid rental stress. Once your budget is sorted, it’s time to decorate and make your house feel like a home.


*To qualify for the bonus variable interest rate on eligible amounts in your USave account(s) in a calendar month, you must have both a USave and USpend account and deposit $200 or more into your USpend transaction account or your linked USave savings account from non-UBank accounts during the same month. The bonus variable interest rate will be applied to a combined balance of up to $250,000 held in your USave account(s), including joint accounts. Any remaining balance greater than $250,000 will earn the USave base variable rate. Bonus interest is earned the same month you meet the bonus interest criteria. If you qualify for bonus interest, your interest will be paid in 2 credits. The first credit is calculated using the base variable rate, and will be visible in the morning of the 1st of the following month. The second credit is the Bonus Interest, which will be processed overnight on the 1st, so please check your account on the 2nd of the following month.

USave and USpend are issued by UBank, a division of National Australia Bank Limited ABN 12 004 044 937 AFSL 230686. Before making a decision to acquire either product, you should obtain and consider the relevant Terms and Conditions available at

The information contained in this article is of a general nature only. It doesn’t take account of any person’s objectives, financial situation or needs. Before acting on this information, you should consider whether it is appropriate for your circumstances and seek independent legal, financial, and taxation advice.