The 30% rule and HUD Fair Market Rents
The most widely used affordability test says rent should take no more than 30% of gross household income. It is the threshold HUD uses to count a household as “cost-burdened”. This calculator applies that test — or a stricter or looser share you choose — to HUD’s Fair Market Rents (FMRs) for every metro, so you can see which unit sizes your income covers and what income each size requires.
Worked example: $60,000 in Chicago, IL-IN
At 30%, $60,000 a year supports $1,500 a month in rent. Here is how that compares with the FY2027 FMRs for Chicago, IL-IN:
| Unit | FMR | Share of income | Income needed at 30% |
|---|---|---|---|
| Studio | $1,678 | 33.6% | $67,120 |
| 1-bedroom | $1,780 | 35.6% | $71,200 |
| 2-bedroom | $2,011 | 40.2% | $80,440 |
| 3-bedroom | $2,586 | 51.7% | $103,440 |
| 4-bedroom | $2,954 | 59.1% | $118,160 |
The income needed is simply the annual rent divided by 0.30: a $2,011 2-bedroom needs $24,132 ÷ 0.30 = $80,440. Full housing detail is on the Chicago, IL-IN cost-of-living page.
Where a 2-bedroom needs the least and the most income
Across the 387 metros we cover, the median 2-bedroom FMR is $1,347 a month. Ranked by the income a 2-bedroom requires at 30%:
| Lowest income needed | 2-BR FMR | Highest income needed | 2-BR FMR |
|---|---|---|---|
| Jefferson City, MO — $38,480 | $962 | Santa Cruz, CA — $170,160 | $4,254 |
| Dothan, AL — $38,640 | $966 | San Francisco, CA — $147,880 | $3,697 |
| Beckley, WV — $38,880 | $972 | Napa, CA — $135,000 | $3,375 |
| Lawton, OK — $38,960 | $974 | San Jose, CA — $130,880 | $3,272 |
| Parkersburg, WV — $38,960 | $974 | Santa Maria, CA — $124,240 | $3,106 |
How many metros fit your income
At the 30% rule, the share of the 387 metros where each household income covers the HUD Fair Market Rent:
| Gross income | Affordable rent | Metros with an affordable 1-BR | …2-BR | …3-BR |
|---|---|---|---|---|
| $40,000 | $1,000 | 128 | 9 | 0 |
| $60,000 | $1,500 | 314 | 249 | 81 |
| $80,000 | $2,000 | 369 | 346 | 255 |
| $100,000 | $2,500 | 380 | 372 | 339 |
| $150,000 | $3,750 | 387 | 386 | 379 |
These counts use the same FMRs as the calculator and treat every metro equally regardless of population.
What Fair Market Rent measures
HUD publishes FMRs every fiscal year to set Housing Choice Voucher payment standards. Each FMR is the 40th percentile of gross rents for standard-quality units occupied by recent movers — so 40% of comparable units rent for less and 60% for more. Gross rent includes the rent plus utilities a tenant pays (except phone, cable and internet), which is why we compare it with a share of income that is meant to cover housing costs, not rent alone. HUD sets one FMR for each metro FMR area; we use the area containing the metro’s principal county. In metros HUD designates for Small Area FMRs, voucher payment standards are set by ZIP code; we use the metro-wide figure.
Census median rent as a cross-check
The results also show the Census Bureau’s American Community Survey median gross rent (2020-2024). It covers all occupied rentals of every size, including long-time tenants with older leases, so it is often below the FMR for a 2-bedroom and is not broken out by bedroom count.
Choosing a share other than 30%
Some planners suggest 25% to leave room for saving or childcare; in expensive metros many renters pay 35% to 40%. Changing the share in the calculator moves your affordable-rent line and the income needed for every unit size at once: income needed = annual rent ÷ share. At 25%, a rent needs 20% more income than at 30%; at 40%, it needs 25% less. HUD treats households paying more than half of income for housing as severely cost-burdened.
Limits of the 30% rule
- It ignores taxes. Two households with the same gross pay keep different amounts in Texas and in New York City. The relocation budget planner shows rent against take-home pay and other costs.
- It ignores childcare and other large fixed costs, which can matter more than rent for young families.
- It is a guideline, not a lender’s or landlord’s rule. Many landlords set their own income requirements; ask before you apply.