What is the 3x rent rule?
The 3x rent rule is a screening standard: a landlord approves an applicant whose gross income is at least 3 times the monthly rent. It is the most common income requirement on apartment applications in the United States. What 3x the rent means, and what it does not, is answered in the FAQ.
- Income needed = monthly rent x 3. For a yearly salary, multiply the rent by 36.
- Read the other way, rent can be no more than one third of your pay before taxes, or 33.3%.
- Worked example: $1,500 rent needs $4,500 a month, which is $54,000 a year or $25.97 an hour full time.
How to calculate 3 times the rent
income needed a month = monthly rent x 3
income needed a year = monthly rent x 36
highest rent you qualify for = gross monthly income / 3
Take the rent on the listing and multiply by 3. An apartment at $1,200 needs $3,600 a month. One at $2,000 needs $6,000.
To check your own pay, turn it into a monthly figure first. A salary divides by 12. Hourly pay is the wage times hours a week times 52, then divided by 12. A paycheck every two weeks is multiplied by 26 and divided by 12, because there are 26 of them in a year, not 24.
If more than one person will sign the lease, add the incomes together. Then divide your monthly income by the rent. A result of 3.0 or higher passes. The short answer on checking whether you make 3x the rent walks through one example.
3 times the rent chart
The income needed at common rents. Each rent links to a page with the 2x, 2.5x and 40x figures, the hourly wage at part-time hours, and the split with roommates.
| Monthly rent | 3x a month | 3x a year | An hour, full time |
|---|---|---|---|
| $800 | $2,400 | $28,800 | $13.85 |
| $1,000 | $3,000 | $36,000 | $17.31 |
| $1,200 | $3,600 | $43,200 | $20.77 |
| $1,300 | $3,900 | $46,800 | $22.50 |
| $1,400 | $4,200 | $50,400 | $24.24 |
| $1,500 | $4,500 | $54,000 | $25.97 |
| $1,600 | $4,800 | $57,600 | $27.70 |
| $1,800 | $5,400 | $64,800 | $31.16 |
| $2,000 | $6,000 | $72,000 | $34.62 |
| $2,500 | $7,500 | $90,000 | $43.27 |
| $3,000 | $9,000 | $108,000 | $51.93 |
Rents from $500 to $5,000 are on the 3 times the rent by amount page.
Is 3x the rent gross or net income?
Gross, in most cases. Landlords compare the rent to what you earn before taxes, health insurance and retirement contributions come out. That is the number on an offer letter and the top line of a pay stub.
A smaller group of landlords asks for 3 times the rent in take-home pay, or net income. On a $1,500 apartment that means $4,500 deposited after taxes, which takes a noticeably higher salary. The guide to gross vs net income on a rental application covers how to tell which one a listing means and what counts as income.
The 2x, 2.5x and 40x versions
Three times is the usual multiple, and it has neighbors. On the same $1,500 apartment:
- A 2x rent requirement asks for $3,000 a month. Rent can be up to half of gross income.
- A 2.5x rent requirement asks for $3,750 a month. Rent can be up to 40%.
- The 40x rent rule, standard in New York City, asks for a yearly income of 40 times the monthly rent: $60,000. That works out to 3.33 times a month.
Is the 3x rent rule a law?
No. Each landlord picks its own income requirement, and no federal law sets a ratio, so you do not always have to make 3x the rent. What the law does require is consistency. Under the Fair Housing Act, a landlord cannot hold one applicant to 3x and another to 4x because of race, religion, sex, disability, family status or national origin.
Some state and local rules go further. Portland, Oregon caps the ratio at 2.5 or 2 times the rent. California and Washington make landlords measure a voucher holder's income against only the share of rent the tenant pays. See whether a landlord can require 3 times the rent for the details.
What to do if you do not make 3 times the rent
Falling short of 3 times the rent does not always end the application. Landlords routinely approve people under the line when something else covers the risk:
- A co-signer or guarantor who agrees to pay if you cannot.
- A larger security deposit, where state law leaves room for one.
- A roommate or partner on the lease, so the incomes are added together.
- Bank statements showing savings that would cover several months of rent.
The guide on renting when you do not make 3x the rent ranks these by how often they work.
The 3x rule and the 30% rule
They are close relatives, which is part of why apartments require 3x the rent. The federal affordability standard counts a household as cost burdened when housing takes more than 30% of gross income. Making exactly 3 times the rent puts rent at 33.3% of income, a little over that line. The 40x rule lands on 30% exactly.
So a renter who barely clears 3x is approved by the landlord and still slightly over what the government calls affordable. The 30% rule compared with the 3x rule shows where each one comes from and which to budget by.