Author Topic: Rent studio or share cheaper house with others?  (Read 5847 times)

Cycler

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Rent studio or share cheaper house with others?
« on: February 06, 2013, 04:54:54 PM »
I'm in a dilemma and could use some advice. I've been reading the site for a few months now and just finished up all the posts. Been biking to work daily for 2 months now 7 mi each way as a result! However, I have reached a point where I'd like to be closer to work and also possibly no longer have roommates, but the problem is that it would end up being much more expensive.

My current living situation is this:
- Shared house with 2 other people. We get along fine, but I'm always the one left taking out the trash and doing chores which gets annoying.
- 7 mi from work
- $800/month in rent
- ~$75/month in utilities
- Close enough to stores etc. to bike/walk and in a nice quiet area

I've been looking at studios downtown near work and they generally run about $1,200 on average, sometimes up to $1,400 for the quieter, nicer buildings. Utilities would probably end up being the same after taking into account that I wouldn't be splitting them with anyone.

I need some mustachian advice here. Since I'm in my mid-20's and still growing my stache should I just eat the less than ideal housing situation and save/invest that extra $4,800-7,200/year? Or with a much nicer living situation should I not worry about the added cost and make the move to within walking distance of work? I could afford to make the move and still put away about 60% of my salary after all other expenses.

Appreciate any and all thoughts - even those necessitating punches in the face for even thinking about it!
« Last Edit: February 06, 2013, 04:58:52 PM by Cycler »

Skyn_Flynt

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Re: Rent studio or share cheaper house with others?
« Reply #1 on: February 06, 2013, 05:29:21 PM »
It is possible to split the difference a bit. Get a small 2 BR apartment and rent the spare bedroom from time to time, to people who are doing a relocation and not likely to stay more than 2 to 4 months. You get some income for a while, and also some peace of mind when you feel like living by yourself.

etselec

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Re: Rent studio or share cheaper house with others?
« Reply #2 on: February 06, 2013, 06:45:57 PM »
There are really two separate issues here: moving closer to work, and sharing (or not sharing) a house with others. Realize that the two are not necessarily linked - you have more options than you think.

Think more about which really bothers you - being 7 miles from work, or having housemates who don't seem to pull their weight? You could look to move into a different shared house, one with higher standards of cleanliness and a better chore rotation - and maybe get closer to work as well in the process. Or if you really don't want to live with anyone, you could look at studios in your own neighborhood or another neighborhood that would meet your needs but not be as expensive as ones downtown.

You have lots of options, and only you can judge the right balance for your life. But I think it's worth examining which elements of your current situation aren't working for you, and figuring out the most cost-effective way to find a living situation that's comfortable for you.

Sunflower

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Re: Rent studio or share cheaper house with others?
« Reply #3 on: February 06, 2013, 08:26:32 PM »
I struggled with the same choice (even found the studio within sight of work) but in the end I decided to stick it out with roommates. Don't forget that things like internet will still be the same price but no longer split three ways. In the end I couldn't justify the price increase but I'm make <$30,000 a year. If I was making even a small amount more I might have gone ahead with the studio.

Jamesqf

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Re: Rent studio or share cheaper house with others?
« Reply #4 on: February 06, 2013, 08:50:08 PM »
I think it really depends on the particulars of your situation.  Personally, I would stay with the house unless I really, really couldn't stand the roommates.  I think the 7 mile bike commute is about perfect (barring major hills or other route problems), and hated  living in a studio apartment.

Done by Forty

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Re: Rent studio or share cheaper house with others?
« Reply #5 on: February 06, 2013, 08:56:17 PM »
Sharing space with others is generally a good financial move.  If you don't like these roommates, how about new ones in the same area?  Presuming your rent isn't a crazy steal at the current place, you could get new digs, new roommates, and the same costs/commute.  Plus, fresh starts are good.

Dynasty

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Re: Rent studio or share cheaper house with others?
« Reply #6 on: February 06, 2013, 09:02:11 PM »
Having experience with having two room mates in a shared house, your chances of finding room mates who do their fare share is limited.

What's more important? Saving several hundred dollars a month? Or piece and quiet, and not having to pick up after your piggy room mates?

How much for rent in a one bedroom apartment in your current neighborhood?

Moving downtown is always (generally) going to have a premium on the price rather than living a few miles away. A 400 dollar jump in living expenses is going to be a lot more than you think. That's a 50% increase from where you're at now. That will get old really fast.

 

DoubleDown

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Re: Rent studio or share cheaper house with others?
« Reply #7 on: February 07, 2013, 09:25:04 AM »
Good question. Can you elaborate on what your expected savings rate would be in the studio apartment? If you could still maintain a high savings rate (to me, that's 50% or more) because you're earning a lot, then I'd say it's a fair trade to make. If it's going to make a serious dent in your savings, then maybe it's worth it to stick it out with roommates a bit longer if you can.

ladycygnus

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Re: Rent studio or share cheaper house with others?
« Reply #8 on: February 07, 2013, 09:35:06 AM »
There is a pro to having roommates that most people don't think about and it's simply that we are not meant to live alone. I find, personally, that I'm more motivated to do things. As in the friend walks in and I realize that I've been watching youtube videos of cats for a half hour..whereas living alone I wouldn't have noticed for another hour.

As for chores, I found that rotating was a BAD thing, we could never remember who did what and if one of us missed a week then the next person ended up doing double. Instead we have segregated chores (I clean the stove/sink and take out the trash since I don't mind taking care of icky stuff, she does the floors since she sees dirt on them whereas I only notice it when it sticks to my feet).

Cycler

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Re: Rent studio or share cheaper house with others?
« Reply #9 on: February 07, 2013, 10:02:26 AM »
Wow some great points here! I'll have to check back more frequently so I can keep up!

It is possible to split the difference a bit. Get a small 2 BR apartment and rent the spare bedroom from time to time, to people who are doing a relocation and not likely to stay more than 2 to 4 months. You get some income for a while, and also some peace of mind when you feel like living by yourself.

I thought about this but one of the other big hassles with the current house is that every 6 months or so recently someone has moved and finding people on CL to replace them is a huge time drain with all the interviews and back and forth. Ideally I'd like to buy a place and do this, but with house/condo prices here that is out of the question.

There are really two separate issues here: moving closer to work, and sharing (or not sharing) a house with others. Realize that the two are not necessarily linked - you have more options than you think.

Completely agree here - I definitely don't mind the bike ride, it is really the roommates and having to clean up after other people constantly. Unfortunately the whole peninsula around Silicon Valley is pretty pricey, the cheapest studio I've been able to find within 10 miles of work so far was $1,100 and it was a pretty abysmal place right on a major road (read: extremely noisy traffic constantly). One bedrooms in the cheaper areas still tend to run around $1,400.

Good question. Can you elaborate on what your expected savings rate would be in the studio apartment? If you could still maintain a high savings rate (to me, that's 50% or more) because you're earning a lot, then I'd say it's a fair trade to make. If it's going to make a serious dent in your savings, then maybe it's worth it to stick it out with roommates a bit longer if you can.

In the studio my savings rate would be around 60%. But I would be saving around 70% if I stayed in the house which equates to a 4 year difference in early retirement  as per MMM's calculations: http://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/. Am I just being cheap by worrying about that 10%?

There is a pro to having roommates that most people don't think about and it's simply that we are not meant to live alone. I find, personally, that I'm more motivated to do things. As in the friend walks in and I realize that I've been watching youtube videos of cats for a half hour..whereas living alone I wouldn't have noticed for another hour.

As for chores, I found that rotating was a BAD thing, we could never remember who did what and if one of us missed a week then the next person ended up doing double. Instead we have segregated chores (I clean the stove/sink and take out the trash since I don't mind taking care of icky stuff, she does the floors since she sees dirt on them whereas I only notice it when it sticks to my feet).

These are great points. I still think that I'd be productive and manage my time well in the studio but it may be easier to just lay down a set of chores to help mitigate the messiness a bit - I doubt it would solve it completely but would probably get closer.

Sunflower

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Re: Rent studio or share cheaper house with others?
« Reply #10 on: February 07, 2013, 10:21:34 AM »

Completely agree here - I definitely don't mind the bike ride, it is really the roommates and having to clean up after other people constantly. Unfortunately the whole peninsula around Silicon Valley is pretty pricey, the cheapest studio I've been able to find within 10 miles of work so far was $1,100 and it was a pretty abysmal place right on a major road (read: extremely noisy traffic constantly). One bedrooms in the cheaper areas still tend to run around $1,400.


1. I know someone who found a studio in this area for $1200/month that's not in a terrible area and is definitely nicer than 'abysmal'. If your current housing situation is such that people more out from time to time (i.e. you aren't locked into a lease) then I'd keep watching craigslist until something comes up that's worth moving for. No need to decide today that you're going to move out but also don't decide that you're going to stay where you are forever.

2. If I was able to live in a studio with a 60% savings rate I would absolutely make the switch. For me, enjoying those 4 years with a quiet, clean place that I could call my own would be worth it.

jpo

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Re: Rent studio or share cheaper house with others?
« Reply #11 on: February 07, 2013, 10:41:59 AM »
In the studio my savings rate would be around 60%. But I would be saving around 70% if I stayed in the house which equates to a 4 year difference in early retirement  as per MMM's calculations: http://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/. Am I just being cheap by worrying about that 10%?
If this is the case I personally would get a studio. I value having my own space pretty highly.

icefr

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Re: Rent studio or share cheaper house with others?
« Reply #12 on: February 07, 2013, 11:30:36 AM »
In the studio my savings rate would be around 60%. But I would be saving around 70% if I stayed in the house which equates to a 4 year difference in early retirement  as per MMM's calculations: http://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/. Am I just being cheap by worrying about that 10%?
If this is the case I personally would get a studio. I value having my own space pretty highly.

Agreed. This depends on how much you value your space. My savings rate including bonuses is about 65% right now and it would be about 75% with a roommate, which would shave about 3.5 years off of working. I'd rather live by myself and work those extra years.

You probably wouldn't mind working for another 4 years if you had your own place versus living with roommates, so it could even out and make you happier in the short-term. One thing though about going from a house to a studio: will that feel like enough space?

DoubleDown

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Re: Rent studio or share cheaper house with others?
« Reply #13 on: February 07, 2013, 03:03:18 PM »
Wow that's awesome that you're already saving 70%! And going to 60% is still excellent.

Perhaps as a kind of compromise, you could find a way to move to the studio apartment and keep the savings rate around 65%, either by picking up some small extra income, cutting expenses elsewhere, or both? If you could do that, I think you should feel no qualms about making the move if it would bring you greater happiness. I personally think you shouldn't feel qualms at 60%, but maybe giving yourself an objective to find another 5% will give you extra motivation!

Oh, I'll throw in one other option -- when I lived with roommates, we had a housekeeper come in once a week to clean, do dishes, laundry, etc. It's not a choice I would have made on my own, but they wanted it so I went along gracefully. I'll say, it really did help eliminate some of the mess and bad feelings that could have arisen otherwise. I'm not sure it will completely compensate for unthoughtful or messy roommates, but it could be a lower-cost option than moving when splitting the cost among you, while preserving your sanity.

Best wishes in whatever you decide!

Cycler

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Re: Rent studio or share cheaper house with others?
« Reply #14 on: February 07, 2013, 09:46:26 PM »
After a lot more thought I agree that the value of having my own space makes it largely worth it. And DoubleDown that is the perfect kick in the pants I need to get going on some side projects to get me back up to a 65% savings rate!

I also think that I'll be able to be more productive at work and maybe be able to move up faster without any added stress from the living situation. Or at the very least take the extra productivity and put it towards a new language or potentially carpentry or another skill.