Imagine if I earned $90000CAD annually (before Tax) in Toronto, what would be the most financially sensible maximum rental cost to bear?

Would renting a house for $2500CAD monthly be somewhat over-the-top?

Also imagine if I was married and my wife earned an additional $50k - $60k Canadian (before tax), would a $2500CAD monthly rental in Toronto be financially justifiable?

  • While interesting, this seems backwards if speculative. A better question might be how to calculate an appropriate range of rental costs given a before-tax income amount and marital status. – Brythan Apr 21 '18 at 17:26
  • I sort of answered in that light. I’d be happy to see an answer from a different angle. – JoeTaxpayer Apr 21 '18 at 19:26
  • Note really a proper answer, but... My answer would be "as little as possible, then save the excess towards buying a home". – Simon B Apr 21 '18 at 20:35

Good question, but the answer “depends” on many factors.

You are starting with 1/3 of your gross income as rent. In general, the rule of thumb is 25% or less.

But, it depends. Are utilities (heat, electricity, water) included?

More important, what does the overall budget look like, what’s being compromised for that 30%?

I know people who pay 50% to rent. In return they are a 2 minute walk to work. No car(s) or any transportation cost. The money saved and time saved each day makes the insane 50% pretty good when under scrutiny.

Does the 33% rent leave you room for savings, travel, etc? If so, no problem. That’s for you to decide.

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