Rent-to-income calculator

The 3× rule and the 30% rule are the same rule

Two screening conventions dominate residential renting, and most landlords use one without realising it is the other wearing a different hat.

The 3× rule says gross monthly income should be at least three times the rent. The 30% rule says rent should be no more than 30% of gross monthly income. Three times rent means rent is 33.3% of income; 30% of income means income is 3.33 times rent. They are the same line drawn from either end, and 3× is very slightly the more permissive of the two.

That is why the calculator above shows both the percentage and the multiple. If you have been asking for 3× and describing it to applicants as "the 30% rule", you have been applying a marginally looser standard than you said. On $1,850 rent, 3× asks for $5,550 a month and 30% asks for $6,167 — a gap of about $617 a month, or roughly $7,400 a year in required income. Rarely decisive, but worth knowing which one your lease and your listing actually claim.

Gross, not take-home

Both conventions use gross income, before tax and deductions. Applicants frequently quote net pay, which will make a perfectly qualified person look short by roughly a quarter. Ask explicitly for gross, and say so on the application form.

What counts as income

Wages are the easy case. Also legitimate: self-employment income, documented via tax returns rather than a single good month; benefits and subsidies; pensions; child support and alimony where reliably received; and, with care, income from a co-signer or guarantor who is actually on the lease. Combine all applicants who will be jointly liable — screening each person separately against the full rent will reject most couples who could comfortably afford the unit.

Where the ratio stops being a good screen

A ratio is a crude instrument, and it gets cruder at the extremes. On a high income the 30% line stops meaning anything — someone earning $400,000 is not strained by $4,000 rent at 12%. At the other end, in expensive markets a strict 3× threshold excludes a large share of working applicants who have nonetheless paid rent reliably for years. Payment history is usually the better predictor; the ratio is a first filter, not a verdict.

Apply it identically to everyone

Whatever threshold you set, apply it the same way to every applicant, write it down before you start screening, and keep a record of how each applicant measured against it. Fair housing law does not care about your intent; it cares whether your process treated people differently. A documented, consistently applied numeric threshold is one of the better defences available to a small landlord.

Some jurisdictions restrict or prohibit income-ratio screening outright, or require that housing subsidies be counted as income, or cap how much weight you may place on the ratio. Those rules vary by state and increasingly by city. Check what applies where your unit is before you make the ratio a hard cutoff.