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How much is too much for rent?
March 23, 2014 2:11 PM   Subscribe

I've searched around, and it appears the common guideline for considering rent amounts is not to go over one-third of your monthly salary.

The trouble I'm having is that I currently live with a friend for only $200 per month (all included). To move out, I would need to get a single bedroom for $770 per month + utilities + internet. So the rent would jump to about $980 per month. I make 45k per year, and I have no debt and no car payment. According to this rent calculator, I am in an affordable bracket.

I know that you all will say, "Stay with your friend!" However, I've stayed with my friend for nearly four years now, and he has a family. They have been very kind in allowing me to stay here, but I feel that it is time for me to move on.

I have searched and searched for roommates, but I live and work in the suburbs, and I'm not from around here. I've had a couple of opportunities come up and disintegrate over the last few months, and so I am getting discouraged trying to find a roommate.

Is the studio apartment for $980 per month a bad idea? I am having a hard time thinking about it logically because it's such a huge jump in my payments. It almost feels irresponsible. What would you do?
posted by uncannyslacks to Work & Money (19 answers total) 1 user marked this as a favorite
 
Where do you live? $210 is a lot of money for utilities, for one thing, and $770 is a lot for a studio in the suburbs. Is it possible to rent something a little less nice, or with utilities included, or in a cheaper neighboring town? Also, I know the roommate thing has been tricky - it usually is, blech - but if you are young-ish and this is common in your area, it might be easier to move into a place that has 3 or 4 roommates.

I make about what you do, also no debt or car payment, and I would be...reluctant to spend that much on rent. On the other hand, you've presumably saved up a bunch from living with your friend all these years, so you've got a bit of a cushion. I don't think it's irresponsible, but it is a lot of money and you're right to give it careful thought. Are there other expenses you could cut out in order to maintain your level of savings?
posted by goodbyewaffles at 2:19 PM on March 23


I've paid $875+utilities for a studio in the San Gabriel Valley while making $32k per year, and due to a simple lifestyle, still managed to put a little into savings. (My landlady initially wanted a cosigner, but waived it before I signed the lease.)

Have you done any bigger picture budgeting?
Do you know where all your money is going each month?

Other than saying "that's normal and affordable", there's not much advice to give without knowing more about your long term goals/outlook.

Living in a studio can be really lonely. Besides saving a bunch of money on shared rent/utilities something I like about being in a shared house is that I can hang out in the common areas and chat with roommates if I'm feeling too isolated.

A possible way forward from here is to keep looking for more sustainable shared housing situations for another 6-8 months, and each month set aside $500 into a "moving out" fund, so if nothing has come through in that time period, you have a few thousand extra dollars to use as a buffer when you move into a studio.
posted by itesser at 2:25 PM on March 23


I know that you all will say, "Stay with your friend!"

Maybe I've been spoiled from living in NYC for so long, and having a lot of relatives in London, but that sounds like you'd be doing fine to me, if you like the place you'd be moving to. Since you're leaving a good deal price-wise, concentrate on finding a place you'll be happy to come home to. I'd say you can afford it if you want it.
posted by mdn at 2:27 PM on March 23 [1 favorite]


You've been living for four years with a friend who has a family, and you now have the opportunity to live in your own apartment for about 25% of your salary, even after adding utilities and internet?? I would go for the new place in a heartbeat.
posted by merejane at 2:28 PM on March 23 [9 favorites]


I think you should look at your budget in its entirety. How much are you spending on other things? If you subtract $980 each month for rent and utilities, will you still have enough to cover your other expenses and put some money into savings? My hunch is that the answer is going to be yes, unless you eat out every night or wear $1000 shoes or otherwise have some unusually high expenses.

Living with a friend who has a family is an unusual sacrifice for an adult to make, and I think it's ok to spend more money so you can have more privacy, independence, etc.
posted by ArbitraryAndCapricious at 2:31 PM on March 23 [3 favorites]


The 30% thing is a guideline, not a rule. Guidelines can't take individual circumstances into account: for example, the same advice wouldn't apply equally to both you (with no debt) and somebody who's spending $800/month on student loans and $350/month on a car payment... the second person simply has a lot more expenses to deal with. So don't accept it as gospel that 1/3 is the "correct" amount for everybody to spend on rent. It's a rule of thumb, but nothing more.

In the end, the only important question is whether you can afford all the checks you have to write every month with some left over for savings and fun. If you haven't already, it might be time to sit down and make a list of your expenses - the 50/20/30 rule is a good place to start if you've never done this before. If you can afford the rent, and your expenses, and putting some money into savings, and you still have some cash aside every month for fun (this is really important actually), then go for it and feel good about it.

Also, consider that money, and how you spend it, is a highly personal thing. Whether it makes sense to stay with your friend or get your own place is a question only you can answer. From a purely financial standpoint, the cheapest thing will always be the best. But that's only one aspect, and if you feel you need your own space, don't ignore that feeling. People tend to be kinda judgey about how other people spend their money (and from your question, it sounds like you're worried about that), but if you've made a budget and the numbers work out, then it sounds like you're in good shape!
posted by captainawesome at 2:32 PM on March 23 [4 favorites]


I'm in NYC and was pretty recently in a comparable situation (where I actually managed to save up enough money for a down payment on an apartment after a few years). It sounds like a good deal overall to me. The utilities do sound high though.
posted by mlle valentine at 2:33 PM on March 23


If it fits with your budget, I don't see a problem, but as others have said, there is the intermediate option of getting a roommate in a situation where you wouldn't feel you were imposing, if you don't want to make such a big jump.
posted by metasarah at 2:46 PM on March 23


To move out, I would need to get a single bedroom for $770 per month + utilities + internet. So the rent would jump to about $980 per month.

This doesn't sound like an "affordable" area at all. I lived in New York City (with roommates) for a lot less, and currently have my own apartment in Los Angeles for also way less.

That said, if that's really the cheapest possible arrangement, yeah, I would probably opt for it unless you have other significant expenses that would make it impossible for you, like a car note, student loan payments, or child support.

$200 a month rent is great and all, but it's really not realistic. After four years living virtually rent-free despite having a normal middle class job that is enough to get by on without insanely subsidized rent, I think it's time to grow up and just take the financial hit.

The utilities sound a bit high, though. Could you not just be a bit more frugal with electricity, forgo a landline phone, opt out of cable, etc? I can't really imagine how it could cost $210 a month to keep the lights on and have wifi.
posted by Sara C. at 3:24 PM on March 23


One other point about the 1/3rd rule. The other factor to look at is transportation, the cost of which is often driven by location. So an apartment may be perfectly affordable even if it costs more if you can walk to work, but a cheaper apartment much further away may be unaffordable if your vehicle or transit expenses are too high. The rule of thumb I see in the US is that housing + transportation costs should be less than 45% of your household income.
posted by postel's law at 3:26 PM on March 23 [1 favorite]


I know that you all will say, "Stay with your friend!"

I wouldn't say that. "Quality of life" is about a lot more than just dollars spent.

To move out, I would need to get a single bedroom for $770 per month + utilities + internet.
Is the studio apartment for $980 per month a bad idea?

Nthing everyone else saying that over $200 for utilities not even including internet seems really high. Where did you get those numbers from?

If you're using your friend's bills as a guide, keep in mind that one person in a small apartment can use much less in the way of utilities than a family in a multi-room house. And often apartments have some utilities (like water or gas for heating) included as part of the rent, whereas homeowners have to actually specifically pay those bills.

So maybe it's worth re-analysing your idea of what living on your own would cost.

And definitely shop around for places - visit them, talk to the landlord/manager about exactly what is and is not included in the rent, look at the neighborhood. Depending on where you're looking prices can vary a lot even within a few blocks, so check out multiple apartments.

It almost feels irresponsible. What would you do?

Or you could see moving into your own place as being more responsible. At your friend's place do you do any of the cooking or washing dishes or housecleaning or laundry or pay any bills besides the $200 in rent? And you may not have a good grasp of where your money goes, since you've got so much of your income left after paying your small amount of rent that you don't really need to keep track of spending or have a serious budget. These are all valuable (maybe even necessary) life skills that you may not be developing in your current situation.
posted by soundguy99 at 3:27 PM on March 23


For what it's worth, this is in Florida about forty minutes from the beach. I expect I overestimated my utilities...
posted by uncannyslacks at 6:23 PM on March 23


If you're basing utilities on a space you've been sharing with a full on family, I'd say you've definitely overestimated.

An individual can exert a lot of cost control just by being responsible with the thermostat.
You might also find it easier to streamline food costs living on your own (YMMV).

So, yeah, echoing those above who suggest some holistic budgeting and planning.
posted by Schielisque at 6:48 PM on March 23


That doesn't seem irresponsible to me at all, especially if you will enjoy having your own space.
posted by needs more cowbell at 7:28 PM on March 23


I'm not sure what part of Florida you're from, But I've never paid more than $650 for a regular modern one bedroom apartment on the west coast.... I always lived within 10 miles of the beach. I would look around a bit more. My A/C constantly ran... but I dont think I ever had a bill over $100. But, if you can't find anything cheaper, I would still consider a higher priced one rather than living with a friend and their family. It seems like you could afford it. Also, consider renting a house. My Mom is renting a nice 2bd/2bath house for $780 in a nice neighborhood.
posted by KogeLiz at 7:47 PM on March 23 [1 favorite]


If your friend is happy for you to stay, and you're happy to stay, then stay. Tell him you feel like you might be taking advantage of him, and that you'd like to pay more-- it's still a bargain for you at twice the price, so why not?
posted by alexei at 8:53 PM on March 23


Where exactly in Florida are you? You should be able to get a pretty nice place, with a decent commute for less than $770 per month.

If you get a lower unit, it will be cheaper to cool. Also, know that you need to change the direction of the ceiling fans when the seasons change.

FPL is pretty cheap for electric, but you may get creamed on Internet/Cable, some places have this included in the price, so keep an eye peeled, especially if you're looking to rent a condo versus in a complex.

A newer place should be more energy efficient.

FPL has a thing where you can stabilize your electric bill throughout the 12-month period, so you're not paying the earth in the summer and next to nothing in the winter. That helps with budgeting.

But I think that on your salary a place on your own is very do-able.

Good luck!
posted by Ruthless Bunny at 7:32 AM on March 24 [1 favorite]


You need to make a budget or at least track your expenses in some way so you know where the extra rent money will come from. But 980$ is very reasonable rent for someone making 45k, unless you have other large fixed expenses. If you're in the habit of saving a good chunk of cash, you'll be saving less now; if you're in the habit of spending it all, you'll need to cut back in some areas.

It's absolutely doable though and I think for just about anyone the increase in your quality of life (and your friend's quality of life!!) will be worth it a hundred times over.
posted by randomnity at 9:29 AM on March 24


I'm in Orlando. Lake Mary to be exact.
posted by uncannyslacks at 1:18 PM on March 31


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