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Average % of salary for renting?

Average % of salary for renting?

Old Jul 23rd 2017, 5:10 pm
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Default Re: Average % of salary for renting?

Originally Posted by Yorkiechef View Post
A reverse view of this....assuming you earn £30k in uk, take home £1900 per month.

What would you pay in uk for a decent place? £950? Or 50% of your take home.

So why wouldn't you pay 50% of your take home here in Canada?
Yorkiechef - Good point. Mine in the UK is approx. 30% of my salary, but I have an expensive car which is almost as much as the mortgage :O

I think 35-40% would be ok. I think i need to find a job which pays $100k+ wish me luck
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Old Jul 23rd 2017, 5:14 pm
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Default Re: Average % of salary for renting?

Originally Posted by Matt88 View Post
Haha, i can tame wild yards! But no one would want me to do their flooring or tiling though!!

Partner definitely enjoys it more than i do, perhaps you're on to something
There are so many helpful YouTube videos and other resources that its not too bad, there are some things I wouldn't touch as they have to be done to code, but the basics aren't too bad

In that case, how about approaching a place with dated decor (which just needs cosmetic stuff done) and offering to repaint in the landlords choice of colours for a rent reduction?
It would meant they could then rent for more after your year of renting is up as the place would be all smart and spiffy. I know a lot of people who have done that, albeit in the Maritimes not Ontario, but might be worth a go.
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Old Jul 23rd 2017, 6:59 pm
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Default Re: Average % of salary for renting?

Originally Posted by Matt88 View Post
I used this: Canada 2017 Tax Calculator (Federal and Province Tax Calculator) to calculate tax. What percentage is EI and CPP?

Thanks.
Try using one of these:

https://apps.cra-arc.gc.ca/ebci/rhpd...o?lang=English

TaxTips.ca - Canadian Tax Calculator for 2016, 2017 and earlier years includes most deductions and tax credits

Using the official one (CRA) it approximated that on $70,000 the EI and CPP monthly deductions would be around the following amounts:

CPP deductions 274.31
EI deductions 95.08

With monthly take home pay (presuming no Union fees etc) of around $4,298.72

There would likely be a slight variance but it gives you an idea (I believe you could also perhaps claim something for your wife if she is not working). I'm not up to date on employment taxation, so apologies for not being able to give you a more definitive answer.


Last edited by Siouxie; Jul 23rd 2017 at 7:04 pm.
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Old Jul 23rd 2017, 8:14 pm
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Default Re: Average % of salary for renting?

Originally Posted by Matt88 View Post

I'm hoping to get a full break down of expected outgoings, but for now just a general idea of what % people are spending of their household income on rent/mortgage will help us out massively.

Thanks.
I pay 40% on my rent. I'm lucky as I have a pretty good deal. It's not an exact science as I'm in commissioned sales so some months I earn more money but factored on my basic salary which is marginally higher than the average person I pay 40%.

I think people who live Downtown Toronto alone and rent condo's are in the main paying 40 to 50% of income on rent unfortunately. Much easier for couples who may hit the magic 25 to 30% spot.

Rental prices of Downtown Condo's have gone up about 20% in the last two years due to the squeeze on inventory caused by Air BnB.
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Old Jul 23rd 2017, 8:28 pm
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Default Re: Average % of salary for renting?

matt88's figure for net pay is about right. He can claim his non-working spouse's personal tax credit. He will need to consider if there are other deductions but this is going to vary by employer.
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Old Jul 23rd 2017, 9:42 pm
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Default Re: Average % of salary for renting?

What about Extended Health Insurance and/or Dental Insurance?

If Ontario is like BC, the provincial medical scheme (OHIP or MSP) doesn't cover everything.

What are prescription drug costs like in ON? They're not covered under MSP here.


Tenants' Insurance on goods and belongings?
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Old Jul 23rd 2017, 11:25 pm
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Default Re: Average % of salary for renting?

30% is what the financial folks say for max housing % of income, however in certain Canadian city's that isn't always realistic unless really high income.

We are in Vancouver and we pay currently 59% of our after tax income just towards rent.

Car insurance, hydro, renters insurance, transit pass, gasoline, etc eats up approx 30% of what is left after rent.

Sometimes it's simply not possible to keep rent % low and comfortable if your job is in a high cost city, can't move somewhere cheaper etc, part of life in certain areas of Canada these days.
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Old Jul 24th 2017, 7:42 am
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Default Re: Average % of salary for renting?

Originally Posted by JonboyE View Post
matt88's figure for net pay is about right. He can claim his non-working spouse's personal tax credit. He will need to consider if there are other deductions but this is going to vary by employer.
Thanks JonBoyE, thats definitely food for thought! I'll have a research and see what tax relief we can get.
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Old Jul 24th 2017, 7:44 am
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Default Re: Average % of salary for renting?

Originally Posted by Jsmth321 View Post
30% is what the financial folks say for max housing % of income, however in certain Canadian city's that isn't always realistic unless really high income.

We are in Vancouver and we pay currently 59% of our after tax income just towards rent.

Car insurance, hydro, renters insurance, transit pass, gasoline, etc eats up approx 30% of what is left after rent.

Sometimes it's simply not possible to keep rent % low and comfortable if your job is in a high cost city, can't move somewhere cheaper etc, part of life in certain areas of Canada these days.
Wow, thats a very high percentage! Do you have to make cut backs elsewhere to cover your rent?
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Old Jul 24th 2017, 7:47 am
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Default Re: Average % of salary for renting?

Originally Posted by JamesM View Post
I pay 40% on my rent. I'm lucky as I have a pretty good deal. It's not an exact science as I'm in commissioned sales so some months I earn more money but factored on my basic salary which is marginally higher than the average person I pay 40%.

I think people who live Downtown Toronto alone and rent condo's are in the main paying 40 to 50% of income on rent unfortunately. Much easier for couples who may hit the magic 25 to 30% spot.

Rental prices of Downtown Condo's have gone up about 20% in the last two years due to the squeeze on inventory caused by Air BnB.
Thanks for your reply JamesM.

That's reassuring. I think 35-40% would be comfortable.. obviously if we can get lower then that would be great.

I know it'll be harder in the first year or so to find our feet, but hopefully after that we'll be in control of spending and be able to plan better for the future.
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Old Jul 24th 2017, 7:49 am
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Default Re: Average % of salary for renting?

Originally Posted by Siouxie View Post
Try using one of these:

https://apps.cra-arc.gc.ca/ebci/rhpd...o?lang=English

TaxTips.ca - Canadian Tax Calculator for 2016, 2017 and earlier years includes most deductions and tax credits

Using the official one (CRA) it approximated that on $70,000 the EI and CPP monthly deductions would be around the following amounts:

CPP deductions 274.31
EI deductions 95.08

With monthly take home pay (presuming no Union fees etc) of around $4,298.72

There would likely be a slight variance but it gives you an idea (I believe you could also perhaps claim something for your wife if she is not working). I'm not up to date on employment taxation, so apologies for not being able to give you a more definitive answer.

Eeek! There are a lot of deductions to consider!! Thanks for taking the time to do the workings out for us. I'll save the links for future reference
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Old Jul 24th 2017, 12:22 pm
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Default Re: Average % of salary for renting?

Originally Posted by Matt88 View Post
Wow, thats a very high percentage! Do you have to make cut backs elsewhere to cover your rent?
Short answer: yes, he does.

Long answer: have a look at Jsmiths posts to get a better idea of how he manages.

HTH.
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Old Jul 24th 2017, 3:19 pm
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Default Re: Average % of salary for renting?

Originally Posted by Matt88 View Post
The Salary for jobs in my area of expertise are around $70-$120k.

My workings out for a Salary of $70,00...After tax = $55,294.37
Monthly After tax = $4,607

I've found decent properties from around $1,700 - $2,200 pcm. ...
So $2000 rent from $4607 leaves $2600 or $31200.

Different province but we were a couple with two teens in school (then one) for a few years until around 2012 and our best year's net income was just over $21000. No rent/mortgage but insurance, water and property tax was almost $300 a month.

Biggest problem - prescription drugs. But if you have employee coverage the problem is gone.

We had non demanding kids, good money managing skills, didn't run a car, and we knew things would get better.

We would've had a much better time with drug coverage and $10k more than than our worst year, let alone our best year.

We're clearly an exception to the rule though and there were some things that were not fun.

On the other hand, that extra $10k is the difference between our best year and your lowest salary in the range you quoted.
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Old Jul 24th 2017, 10:22 pm
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Default Re: Average % of salary for renting?

Originally Posted by Matt88 View Post
I used this: Canada 2017 Tax Calculator (Federal and Province Tax Calculator) to calculate tax. What percentage is EI and CPP?

Thanks.
Here's another one that calculates EI and CP:


Tax Take Home Pay Calculator for 2017.xls
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Old Jul 25th 2017, 7:41 am
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Default Re: Average % of salary for renting?

Originally Posted by BristolUK View Post
So $2000 rent from $4607 leaves $2600 or $31200.

Different province but we were a couple with two teens in school (then one) for a few years until around 2012 and our best year's net income was just over $21000. No rent/mortgage but insurance, water and property tax was almost $300 a month.

Biggest problem - prescription drugs. But if you have employee coverage the problem is gone.

We had non demanding kids, good money managing skills, didn't run a car, and we knew things would get better.

We would've had a much better time with drug coverage and $10k more than than our worst year, let alone our best year.

We're clearly an exception to the rule though and there were some things that were not fun.

On the other hand, that extra $10k is the difference between our best year and your lowest salary in the range you quoted.
Hi BristolUK, thanks for your reply. That's reassuring. I guess it takes time to fully understand and gauage what money is actually coming in and going out.

I will do as much planning as possible. If we move and struggle with rent, we can always downsize
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