Maybe we're kind of lower-middle-class now?
March 30, 2014 7:37 PM   Subscribe

Is 30% of gross income a good guideline for semi-recent-graduates paying rent in Chicago?

My boyfriend and I are both in our mid-twenties in Chicago. We both got new jobs this year which are going well, and together we make about ~$73,000. We currently live in a one-bedroom in a neighborhood south of the Loop for $1200/mo + electric. It's an old building and so far we've had cockroaches and mice, both ongoing issues. I hate cockroaches, boyfriend is ultra-skeeved by mice. Pest control/building maintenance have been bad at taking care of these problems and discourage us from doing it ourselves, though we have anyway because fuck them (e.g., sealing holes and cracks that are probable points-of-entry). The laundry is in the really nasty basement and you have to run the dryer three times to get your clothes dry. There's no hot water pressure and they can't do anything about it, and the drains are always clogging. If it weren't for pests, we'd deal, BUT. tired of pests.

We recently toured a new high-rise "luxury" style building that just finished construction in our neighborhood. The one-bedroom units are nice and fairly spacious, have in-unit washer/dryer (loooove this), there's a workout room in the building, it's LEED-certified, utilities max at $110/mo., gigabit internet is included in rent, and since it was just gutted there are no pest problems, and there aren't cracks and gaps (or giant holes in the closets, for example!) to deal with in the event of pests. The building is right on two of our most-used bus stops, and really close to beach and the trails I like to run. The rent for us would be ~$1550 before utilities, ~$1650-1700 afterward.

Technically this meets the 30% of gross income rule, but is it smart? We both make about equal money and each pay about $400/mo. in student debt + CCs. We've been making a lot of headway on our debt in our shitty "cheap" apartment, and paying off debt is our major goal right now, but we're also tired of living in a terrarium? We're also both kind of prissy (anxiety-prone!) and also prone to throwing money at a problem, but we're trying to spend smarter, so we don't know if this is a good idea or if we should try to find something possibly less convenient and more economical.

(Please keep in mind that rent has been rising in Chicago, so if you got a two-bedroom apartment dirt-cheap in 2010, that might not be useful information anymore in 2014-- or it might, idk!)

All our friends are either 1) living like students with 2-3 roommates and paying dirt cheap rent in similarly yechh apartments (hello mice, everywhere) or 2) making more money than us and we don't ask about their financial situations generally. Otherwise our friends live in rural/suburban areas and like have cars, and/or wives/husbands/children, and other unknowable things that make our comparisons useless. Neither of us has ever made this kind of money before so we really don't know if this is a reasonable, adult amount to spend, or if we're being kind of too-extravagant? Especially when-- this being another thing?-- we have vague, sort-of plans to leave Chicago next summer, possibly for grad school.

Most of my past Asks are about my bad luck renting in Chicago, so I am pretty fatigued when it comes to pests, at least. Sorry for the 10 million apartment questions, you guys have been really helpful in the past and I have yet to develop wisdom in this area.
posted by stoneandstar to Home & Garden (25 answers total) 2 users marked this as a favorite
 
Is there a reason you need to live in the Loop? I ask because we live in a rehabbed, big 1BR in Ravenswood with in-unit W/D, central air, and a yard for $1300 a month (we moved in last summer). We're two blocks from the El and the Metra, so it's still a quick commute to downtown. There are still 1BRs around here for under $1000 a month, again as of last June, though you won't have the amenities.

If you're paying $800 toward your debt (which is super super worthwhile), it's probably not a great plan to pay $1700 a month for your apartment. It's worth living somewhere slightly less convenient to save hundreds of dollars a month. Also, roaches/mice are more common in the denser lakefront neighborhoods. If you move further in, you're less likely to have those issues, IME.
posted by goodbyewaffles at 7:46 PM on March 30, 2014


Best answer: You should do what it takes to pay off as much (BETTER ALL) of your non-student loan debt (e.g. credit cards) before you go to graduate school. If you can live in the expensive apartment and pay it all of great. It might be worth it to you to trim your lifestyle in other ways while living in the expensive apartment and paying down debt (e.g. not eating out, buying tickets, etc.) Do a written budget each month. If you can't pay of your debt before grad school in the expensive apartment, I say stay in the cheap one.
posted by Jahaza at 7:46 PM on March 30, 2014


I think it really depends on your comfort with risk and how much you have left over for general/savings/emergency. Would you fall into another debt cycle if you depart AT ALL from your budget? Or think of it this way - if you go to grad school next year, would it be better to have a year of comfortable living now, or less debt/more savings for when you're returning to student life?

Also, when I lived with a significant other, my rule of thumb was to rent a place (with him) that I could afford on my own. You never know what might happen - job loss, accident, breakup, someone has to move and the other person has to stay behind for a while. If you feel like you could get a roommate in any of those scenarios, then that's less of a concern, and everyone's risk tolerance is different. That rule helped me a lot when we eventually ended the relationship.

Finally, you probably will make more money some day, so this isn't your last chance to live well.
posted by MsMartian at 7:52 PM on March 30, 2014 [1 favorite]


I hate insects with a burning passion and would not be able to live in your current apartment. But you do have choices besides current cheap/nasty place and new fancy/expensive place! Look for newer or better maintained apartments in less convenient or desirable neighborhoods, that may be priced somewhere in the middle. Or pretend that you live in San Francisco and find a roommate to share the rent with (in SF people making twice as much as you two do often still live with roommates).
posted by serelliya at 7:55 PM on March 30, 2014 [1 favorite]


I house low income people in chicago. Depending on area and comfort you can find places for under 30 percent for your needs. 30 percent is a good guideline. I live in a predominantly hispanic area and pay 800 for a two bedroom washer and dryer included that's about 1000 square feet. It took us awhile to find this steal but it is possible.
posted by AlexiaSky at 7:57 PM on March 30, 2014


And to comment about the incects...that's not normal. Many many low income places in Chicago do not have pest issues. Best advice is to look on yelp and the bedbug report site. Also pay attention for any pest signs when looking.
posted by AlexiaSky at 7:59 PM on March 30, 2014


My experience having moved from a low cost apartment to one where I spent this amount of money on rent is that I went from feeling like, "wow! I have so much money!" to "Whoah! Where did all off my money go??? I have to budget for ever dollar!"

Obviously, you don't want to live someplace with pests, but I highly recommend spending less money in rent than you're planning unless you foresee an increase in salary in the near future.
posted by deanc at 8:01 PM on March 30, 2014


I think you should seriously consider the new place. After utilities and counting your free internet, the difference would be... maybe 350 a month? It's worth asking yourself if it's worth $10-11 a day to live in a clean, nice, pest-free home. That's a few nights out a month in a place like Chicago. Perhaps it'd be easy to rebudget -- sack lunches, game nights with friends instead of going out, a little less shopping.

Worth considering. I'd probably do it if it's just a year. I hate pests.
posted by mochapickle at 8:12 PM on March 30, 2014 [5 favorites]


It depends on your goals. Paying down debt would give you more choices in your lives, sooner. If that's not as high priority for you as better living conditions and the new place fits in your budget (factoring in everything else you spend money on), then go for it.
posted by metasarah at 8:28 PM on March 30, 2014


Personally, I think the guideline of spending 30% of your salary on housing is RIDICULOUS. Like, laughably so. My rent is 10% of my take-home pay in a pretty pricey part of Seattle, and even that feels a bit high. I just can't imagine spending more than that in addition to eating well, socializing, paying off student loans, and traveling a bit. But those are my priorities - what are yours?

All of that said, I don't think you should spend a pittance in order to live in a pest-filled apartment. There has to be something between cesspool and luxury high rise.
posted by joan_holloway at 8:50 PM on March 30, 2014


Not from Chicago, but I've been, so I'm a little familiar. I did a Padmapper search for 1 bedroom apartments between $1,100 and $1,400 and there are hundreds and hundreds of listings. If I'm in your shoes, I would absolutely pick a middle ground between mice+roaches and luxury living at too much money.
posted by cnc at 8:55 PM on March 30, 2014


I think you should seriously consider the new place. After utilities and counting your free internet, the difference would be... maybe 350 a month? It's worth asking yourself if it's worth $10-11 a day to live in a clean, nice, pest-free home. That's a few nights out a month in a place like Chicago. Perhaps it'd be easy to rebudget -- sack lunches, game nights with friends instead of going out, a little less shopping.

I don't live in Chicago and my financial situation is different, but this is basically my advice. We recently did what I guess was in essence a "financial reboot" -- we stopped everything except housing and car insurance, basically, and every expense is getting looked at with great care. I've been blown away at how much money was just sort of flowing through without having anything worthwhile to show for it. It's easy to drift into spending that isn't all that critical and doesn't add all that much happiness to your life, and over time that turns into serious money.

From my perspective (which is not yours, so discount accordingly) the monetary difference between the two apartments looks very small, while the quality of life difference looks huge. One thing I've learned over the years is that if I'm happy in my living situation, I go out for meals a lot less, and invite friends over more often. I'd strongly suggest looking at your overall budget and seeing if there is an easy way to find the $350 in savings like eating out less, buying one less pair of jeans this month, and drinking cheaper coffee and then committing to each other to stay with that plan. (It's too easy to find savings on paper that never materialize in real life.)
posted by Dip Flash at 9:05 PM on March 30, 2014 [3 favorites]


How I picked my apartment was by deciding how much commute time I was ok with having per day, google mapping to find the train stations that fit within those boundaries, then searching craigslist for apartments under $x (where x was no more than 25% of my salary at the time) near those stations or closer. I ended up living 30 minutes away from work in Little Village paying $675 a month for a 3 bedroom. Having cheaper rent enabled me to do things like buy a washing machine so I have in-unit laundry and pay off my student loans faster. I'm considering hiring a cleaning person because I'm lazy and I can afford it because my rent is cheap. It's not the world's fanciest apartment and it's not in the world's fanciest neighborhood, but it's mine and I've made it work for me.

My point is, there are tons of places in this city that are better than your current place that are more affordable than this luxury high rise. For me personally, at my age and station in life, having more money available to me every month is more important than having a doorman to accept packages. YMMV. The per diem cost of this new place makes sense relative to your current place, but not relative to other places you could live.

It's worth noting that you are paying way, way, way, WAY too much for your current shitty place. If that is seriously the best you can do rent wise in your area, it might be time to reevaluate your neighborhood choice.
posted by phunniemee at 9:13 PM on March 30, 2014 [3 favorites]


When I made that much money and paid that much rent, I didn't enjoy it much at all. And while it probably was 2010 when I last shopped for an apartment in Chicago, and while it is true that Chicago landlords tend to suck pretty hard, you should be able to do better at the cost of a longer commute.
posted by wotsac at 9:16 PM on March 30, 2014


Best answer: Oh my gosh! Please, living in a pest-filled anxiety fuelling home?! You couldn't pay me to live there.

Please get yourself to a clean, comfortable, safe place to live. Pay more, budget better, but please - don't accept this for yourself.
posted by rhythm_queen at 9:18 PM on March 30, 2014


Response by poster: Thank you for the perspective you guys-- this has already been really helpful. To clarify, we don't live in the Loop, just south of it, I just wanted to indicate that we weren't living in an expensive North-side neighborhood. I agree that we are way overpaying to live in this slum, but it's a university-owned property (we work for a university) and we had MUCH higher expectations when we moved in-- we both attended this university and they were great about their student properties, so we stupidly thought they would be the same about faculty/staff housing. Not true.

We would love to live in a 'hood like Ravenswood, but the commute would be bad-- finding a place on the South Side has been frustrating for us tbh, but we should probably try other methods thoroughly and not be so intimidated by all the choice...

Not renewing our current lease and finding a new place that isn't even more expensive is definitely an option! We are pretty focused on paying off revolving debt so I think paying that off aggressively will remain our main priority.

(Also, right now we have a 10-minute commute which we really really like, since we both work within four blocks of each other but start/end our work day at very different times. A long commute would mean a lot less time together at home AND in our work 'hood so that's something we've thought about.)
posted by stoneandstar at 9:29 PM on March 30, 2014


It's a quality of life balancing issue. The jump from $1200 to $1700 is an additional $6000 a year; given the utilities cap, the commuting convenience and the exercise convenience, and the maximal time together, this seems like a good plan to me. But hey I'm from NYC and have always paid 30% in rent.
posted by DarlingBri at 10:54 PM on March 30, 2014


Best answer: Ugh, I am in the thick of this right now so I hear you.

There honestly isn't much of a middle in Chicago, because once you get above the $1200 mark, they typically stop including utilities. So that 1350 apartment quickly becomes 1550 with gas and water and electric, and it won't even be THAT nice of an apartment. Never mind if we get another superwinter, where 400 dollar gas bills come up for six months straight. This city...it kind of blows.

As you're seeing, you can get a lot more apartment, and a lot more amenities, when you go for the straight-up high sticker price. So that's one option: spend top dollar, and make sure you get every drop of value for that dollar.

Option 2: You really can find a cheapie, 1200 a month place that is vermin-free. Vermin are NOT the problem here that they are in other cities. This apartment won't be real pretty, and it won't have a gym or a W/D. And it'll hurt your heart to rent it when you know how well you Could be living. But it will save you the moneys.

I would love to spend 10 percent on housing, but I don't think they have $350/mo apartments in Chicago anymore, so that ain't in my future. Most everyone I know here is paying 25-30% of their gross. I try to pay 30% of my net...but usually fail at that.
posted by like_a_friend at 12:22 AM on March 31, 2014 [1 favorite]


Best answer: I read an article once about how different personality types use their money-- possibly doctor's office Oprah? who knows-- and I was totally unsurprised that my "type" is very home oriented. I would rather live in a clean, cozy place where I can do laundry whenever I want, wearing whatever I want*, than have a few hundred dollars in my pocket for other things. Perhaps it isn't the most fiscally responsible position, but I really believe that having a really nice place to live makes me happier than other material things.

So I would totally go for the upgrade place, damn the torpedoes. And maybe you guys are like that too.

*Seriously, doing laundry naked-- thus not generating more laundry whilst doing it-- is one of the prime pleasures of life.
posted by charmcityblues at 12:26 AM on March 31, 2014 [1 favorite]


If you are going to grad school and are going to be poorer, you don't want to get too used to a nicer quality of life. That will make it really hard to cut back when your income drops. I think you should probably stick with your current place if you can, or see if you can find something in between that and this luxury one.
posted by lollusc at 12:35 AM on March 31, 2014 [1 favorite]


Best answer: Are you at UChicago? Consider Bridgeport - that's where most of my UChicago friends live. Hyde Park is way too expensive for what/where it is. Bridgeport is pretty close and much, much cheaper. Plus Maria's is great and you can buy pasties there.
posted by goodbyewaffles at 4:27 AM on March 31, 2014 [1 favorite]


We both got new jobs this year which are going well, and together we make about ~$73,000. We currently live in a one-bedroom in a neighborhood south of the Loop for $1200/mo + electric. It's an old building and so far we've had cockroaches and mice, both ongoing issues.
Whoah. I can't even get through the rest of this post.

I've lived in Chicago my entire "emerging adulthood", five years altogether. My first job, I was making a little more than one of you, and I lived with a roommate and paid $600/month for a rather nice two-bedroom in Ravenswood. In my humble opinion, you are getting screwed. You can get out of your roach-infested apartment right now. Chicago is one city where the tenant has a massive legal advantage over the landlord. If you find yourself living in intolerable conditions (I would say infestation by vermin is pretty intolerable), you can terminate your lease and get back your security deposit. There's some legal stuff to wrangle, but my point is you don't have to wait this out. You could document the problem and leave today.
We recently toured a new high-rise "luxury" style building that just finished construction in our neighborhood. The one-bedroom units are nice and fairly spacious, have in-unit washer/dryer (loooove this), there's a workout room in the building, it's LEED-certified, utilities max at $110/mo., gigabit internet is included in rent, and since it was just gutted there are no pest problems, and there aren't cracks and gaps (or giant holes in the closets, for example!) to deal with in the event of pests. The building is right on two of our most-used bus stops, and really close to beach and the trails I like to run. The rent for us would be ~$1550 before utilities, ~$1650-1700 afterward.
Paying $1550 a month plus $400 in student loans is just... Look, you are not rich people. You are emerging middle class students with debt. Luxury apartments are not for you. You should not be paying that kind of money to live in a swanky luxury condo, when a perfectly good two-bedroom apartment in Albany Park or Pilsen or Logan Square would do just as well and help you pay off your debt quickly. In-unit laundry is nice and all, but it's not worth paying that kind of money.
(Please keep in mind that rent has been rising in Chicago, so if you got a two-bedroom apartment dirt-cheap in 2010, that might not be useful information anymore in 2014-- or it might, idk!)
No, it hasn't. Rent for luxury apartments in the Loop may be rising, but it's not rising that quickly, and definitely not in the neighborhoods. Here's what I paid for rent over the previous years:

2008: $600 (Ravenswood, shared two-bedroom)
2009: $550 (Wicker Park, shared three-bedroom)
2010: $500 (Logan Square, shared bedroom in a rented house)
2011: $925 (Logan Square, split two-bedroom with my S.O., so $462.50 each)
2012: $950 (ditto, split costs, so $475 each)
2013: $975 (ditto, split costs, so $487.50 each)

The last few years we have stayed in the same fantastic two-bedroom, five blocks from the El. We have a porch, we have bay windows, and we're in a neighborhood we love. Even on a shitty weather day, it's 30 minutes to downtown, tops. My rent has been going up slowly – c'est la vie, it's boom-town Logan Square – but the landlord knows that we're good tenants and he isn't going to spike it on us all at once. Notice how I actually spend less money on rent now than I did five years ago. I also have more space and a better location. I am happy here. We may move for a better deal or more space, but not because the apartment is a roach-infested nightmare.

Now here's the trick: it took us forever to find this place. Cheap Logan Square apartments disappear quickly. But our landlord is a stickler for background checks, and he moves very, very slowly with new tenants. We had applications going at three or four different rental companies and landlords. By the time he finally got back to us, we had almost given up, but we snagged this place and have had little reason to think about moving since then. Something goes wrong, we call the handyman who lives next door, and the landlord picks up the tab.

It may not be luxury, but we want for nothing in our little two-bedroom. It suits us well, and keeping our expenses down has helped my S.O. pay off a lot of her debt. Finding cheap housing has been the single best thing we have done to save money. I could have lived in a swanky condo, but then I would be out $50,000. All that money, just so I could have a slightly more convenient commute. Don't do that. Pay off your student loans. Pay them off as quickly as you possibly can. Live as cheaply as you possibly can until you have paid them off. Do not tolerate slumlords who allow roaches and mice to infest the building.
We're also both kind of prissy (anxiety-prone!) and also prone to throwing money at a problem, but we're trying to spend smarter,
Man, I feel for you, but get over it. Blowing close to half your income on a fancy apartment isn't a solution to your problems. It won't make you more comfortable or safer.
posted by deathpanels at 5:31 AM on March 31, 2014


I agree with phunnieme & deathpanels that you need to move neighborhoods. There are 3beds in Lakeview for your 1700/mo figure (I am a landlord, not a tenant, but that's a current) review which don't have vermin problems, which means you can get a much better rent in a different neighborhood. Incidentally, in all the years my middle-aged self has lived in apartments in Chicago, I have never lived in a place with mice/rats indoors (in the alleys, of course) nor one in which I have ever seen a roach. You are totally right to ditch that building, without a doubt.

Now, someone above mentioned that everyone prioritizes their money differently. And if you can pay that rent without going into debt and pay that rent while meeting every other possible expense in a month, there's no moral reason you should not, if that's what you want to do. But personally, I wouldn't. I think your luxury apartment is a bad deal, although I understand the appeal, I really do. But there's no room for error, no margin for an unexpected fun expense. I especially would not spend that much per month if I was looking at the expense of moving within a year. There are definitely better deals to be had in Chicago, even without having to increase your commutes significantly.

I'd recommend working with a broker, honestly, one who charges the landlord, not the tenant. For one thing, it makes it easier to find condos for rent by owner, which can get you back into those luxury buildings for cheaper than a comparable apartment.
posted by crush-onastick at 7:14 AM on March 31, 2014 [1 favorite]


That's a lot of money to spend. I don't live in Chicago (but I do work in the Loop), so I don't have much familiarity with rents and all that.

Having gone through all those years of debt and tight budgeting, the one big thing I came away with is this:

Pay off debt as quickly as you can. Make compromises to achieve that goal. Find a cheaper apartment - not a more expensive one - and find a way to make that work. Throw as much as you can at paying off the debt.

If you're looking to leave Chicago next year, why incur the expense of moving? There's annoyance, aggravation, cost, and oh yeah a lot of money for rent flying out of your wallet. Will you actually unpack in your new place in a reasonable amount of time before you just have to pack up again? Will you get sufficient enjoyment out of a new expensive apartment to justify the expense? Or will you merely get used to a higher standard of living?

What happens when your income drops? When you go on to grad school? When one of you gets laid off? When one of you gets sick?

Don't let money burn a hole in your pocket. Just because you can do something doesn't mean you should.
posted by jgreco at 7:21 AM on March 31, 2014


Best answer: It sounds like you work for or near U of C, which does put the cheaper north side neighborhoods kind of out of reach, commute-wise. Believe me, I get that - I'm about to get out of a living situation where my commute from the far north side to downtown is 1 to 1.5 hours each way via CTA, and it eats up your life. But a 30-40 minute commute is pretty reasonable and is what most people in Chicago are used to.

So I do think there are neighborhoods, some mentioned above, where you could spend the same or a little more than you are now for a much better living situation - Bridgeport, Little Village, Pilsen, maybe Humboldt Park could all get you to Hyde Park in a reasonable commute and you will surely be able to find nicer places than what you're living in now.

I am in the midst of apartment hunting as we speak, so this is my impression based on current rents in Chicago. My boyfriend and I just applied for a HUGE 3-bedroom 2-bath apartment in Humboldt Park that's brand-new, condo-quality construction, has the in-unit w/d, dedicated parking space, roof top deck, etc. It's a little more than the luxury 1-bedroom you describe, but not much considering it's probably twice the size.

All that said, jgreco makes a good point about whether it's worth incurring the cost of moving if you are planning to leave the city in a year. If your current place is that bad, it may be. In my younger years I remember moving apartments every year but now that I'm older I prefer to avoid that hassle if possible.
posted by misskaz at 8:05 AM on March 31, 2014


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