+1

Which is correct and natural?

That’s over our budget. We can’t afford it.

That’s out of our budget. We can’t afford it.


Thank you

+0
anonymousThat’s over our budget. We can’t afford it.

That's when a good or service is in the budget but too expensive.

Your family vacation might have to be scaled back. Rather than staying in a five-star hotel for three weeks, you might want to enjoy camping instead.

anonymousThat’s out of our budget. We can’t afford it.

As you have phrased it, one can argue that you want to purchase a good or service that is not part of your original budget. I more commonly hear the following:

That's not in our budget. We can't afford it.

"Out of our budget" phrase is commonly used, though.

We have always regarded TV advertising and the glossy private health campaigns as way out of our budget. (independent.co.uk via fraze.it)

Note that the above example is similar to your example in that some things considered for the budget are too expensive.

Some of the things we are chopping out of our budget will likely return when the market does, but who knows? (businessweek.com via fraze.it)

In the last example, some things are being removed out of the budget.

I hope that helps.