on Oct 10, 2019 5:10:40 PM

How do I know how much rent I can afford?

When apartment hunting, it can be a challenge to figure out how much, exactly, you can afford to pay in monthly rent. There's a lot of advice out there, ranging from simple to complex. To really understand what you should reasonably be allocating for rent, you need to take a look at your needs, expectations, and the way you live.

How much do you earn?

The simplest standard budgeting advice is to allocate no more than one-third of your income to housing (with a caveat that you may have to resign yourself to paying more than that in expensive areas like New York City or San Francisco). The reasoning is that bills will take up about another third, and the final third can go toward savings and building a retirement fund. Clearly, this is very generalized advice that doesn’t take into account variations in individual lifestyle choices and other financial obligations.

A more accurate way to determine a reasonable housing budget involves calculating all of your fixed costs and aiming to keep the total below 50% of your take-home pay. So, if you have (or anticipate having) bills for a gym membership, car payment, insurance premiums, cable, and Internet, for example, you would add all of those together and subtract them from 50% of your net income; the remainder would be your budget for rent. You can see that using this method gives you a great deal of flexibility in your budget, since reducing other fixed costs frees up additional funds for rent, and vice versa.

If neither method produces the outcome you'd like, we've gathered our thoughts on 6 ways to save money on an apartment. Try some of the suggestions detailed in our blog post and then revisit how much of your budget you'd like to spend on rent. 

What do you need in an apartment?

Aside from basic shelter, what do you need to feel at home? Are you content to live simply in a small space, or does a studio or micro apartment feel cramped to you? Do you want complete privacy in your home, or do you enjoy sharing a household with other people? Do you need a place to park your car, store your bike, or gather with friends? Make a list of your needs, and then begin looking at the range of apartments and living arrangements that can meet them.

What amenities are important to you?

While you may think of amenities as adding to your monthly costs, finding an apartment that provides amenities you'll use can actually be quite cost-effective. For example,
  • An apartment gym can save you money by eliminating the need for a costly gym membership.
  • A well-equipped community room can allow you to entertain outside of your apartment, making a smaller (and less expensive) space more comfortable and possibly reducing the amount of money you spend on going out with friends.
  • Access to outdoor space, such as nature trails, green space, patios, or balconies can also help you feel more comfortable in a small apartment.
  • A location that is convenient to your work, dining options, and entertainment can allow you to eliminate the multiple expenses associated with car ownership.
  • An apartment equipped with modern, energy-efficient appliances can reduce monthly utility bills.

Before you sign your lease, be sure to have some money set aside for initial move-in costs, including security deposit (which can be up to a full month’s rent in central Iowa), moving expenses, and the cost of any new furnishings, décor, and household basics that you’ll need in your new place.

If you’re looking for an apartment in the Des Moines metro, you’re off to a good start. According to AreaVibes, the median rental rate here is 18% below the national average. Ready to start looking? Hubbell Realty has a wide range of properties throughout the Des Moines metro, including West Des Moines, Waukee, Johnston, Norwalk, Urbandale, and of course, downtown Des Moines! For more advice on finding the right apartment for you, visit