Author Topic: How to address raising roommates' rent?  (Read 1768 times)

norabird

  • Walrus Stache
  • *******
  • Posts: 5365
  • Location: Brooklyn NY
How to address raising roommates' rent?
« on: February 01, 2016, 01:33:06 PM »
Hello! So I'm a 'landlord' but also, mostly, a roommate, as my parents bought my apartment. My roommates and I split the mortgage but my parents have been covering the monthly maintenance. I'd like to take that over soon--obviously, it's my responsibility. The rent is low for NYC but I still have some feelings of guilt at raising it, because my roommates are friends and  also aren't super high earners. However, I really need to get over that. The question is the best method to communicate it and also the amount to request.

Very first world problem but I'm not quite used to the situation yet! My parents didn't buy it as an investment, though it could be, and are not expecting a return, but would hopefully  be able to take the extra money going into the maintenance now to take a big trip to Japan if I take this offer. I have mentioned changing the responsibility for this bill to me to them, but feel that if I'm serious about that I should just act to take it over and tell them as a fait accompli. However, I'm just now ramping up my 401k contributions (finally at 20%) and starting to save money for an EF, and don't want to jettison those entirely. Thus I should spread the burden with my apartment mates, I just am feeling gun-shy...

The shortfall is $524. The current rent for us each is $650. Split evenly, the total amount for us each would basically be $800. A $150 increase is almost 25% more, however. A $100 increase is closer to 15%. I've browsed 'roommates wanted' listings on craigslist and $750-$800 is pretty reasonable.

So--should I ask for $800 and say sorry, I'm taking on the full cost of the maintenance? Or ask for only $100 more a month and swallow more of the increase myself? If they ask to negotiate downward, I'm fine to be flexible, but I guess I shouldn't advertise that. I don't want to create hard feelings or take advantage.

I'm also wondering if I should first float the idea that I want to take over this other payment and ask the others what their budgets allow for. Probably this will happen over text or email, or I could tell them I'm thinking of having a conversation about rent and suggest we schedule getting a drink at a new neighborhood bar to discuss it. However I worry that discussing it in person would actually be more awkward.

Thanks for any advice!

GrowingTheGreen

  • Bristles
  • ***
  • Posts: 357
    • Growing The Green
Re: How to address raising roommates' rent?
« Reply #1 on: February 01, 2016, 06:01:12 PM »
You can have tenants and you can have friends. It's difficult for one person to be both.

If you're experiencing a shortfall, that makes things easier to explain to a friend. Tell them the truth. You can say that you're taking on the full cost of the mortgage/expenses, and let them know that you need to at least be made whole. On the flip side, a 25% increase is a tough pill to swallow from their standpoint. You could explore a smaller increase that is automatic every year. Can you add anything to the deal to sweeten the pot for them?

This is a conversation you need to have in person.

Fishindude

  • Handlebar Stache
  • *****
  • Posts: 1522
Re: How to address raising roommates' rent?
« Reply #2 on: February 02, 2016, 05:13:54 AM »
Explain the math and explain that this is just "barnyard economics" and the money is needed to cover expenses.  Give them several months warning so they can relocate if higher rent is a problem, then kick in the higher rent in at a predetermined date.   Chances are it will still be a bargain for all.

norabird

  • Walrus Stache
  • *******
  • Posts: 5365
  • Location: Brooklyn NY
Re: How to address raising roommates' rent?
« Reply #3 on: February 02, 2016, 08:08:37 AM »
Thanks! Sent an email suggesting we get together, mentioning the possibly changing circumstances, and letting them know I'd like to know how feasible an increase would be. I'll loop back on it later in the month. It's not necessary to get the whole raise immediately, but at least the wheels are slightly moving.

Dicey

  • Walrus Stache
  • *******
  • Posts: 6524
  • Age: 59
  • Location: NorCal
Re: How to address raising roommates' rent?
« Reply #4 on: February 03, 2016, 08:36:27 AM »
Try not to wait too long to get back to them. The stress of not knowing what (or how much) is on your mind might make this more difficult than necessary. And I do agree that it is necessary. Basically, you and your parents are subsidizing their rent, which has got to stop. This is not only the real world, it's the NYC edition. If you're below market price, they know it's too good to last forever.

Edited to correct @%&*ing auto complete. Don't misunderstand, I love to swear, but symbols are fun, too.
« Last Edit: February 03, 2016, 08:53:48 AM by Diane C »
I did it! I have a journal!
A Lot Like This
And hell yes, I am still moving confidently in the direction of my dreams...

norabird

  • Walrus Stache
  • *******
  • Posts: 5365
  • Location: Brooklyn NY
Re: How to address raising roommates' rent?
« Reply #5 on: February 03, 2016, 08:49:00 AM »
Thanks Diane! We set up a time for next week. You are right, it's time to bite the bullet.

Jack

  • Magnum Stache
  • ******
  • Posts: 4745
  • Location: Atlanta, GA
Re: How to address raising roommates' rent?
« Reply #6 on: February 03, 2016, 09:15:30 AM »
I'd just tell the roommates that my parents owned the apartment and blame the rent increase on them. It might be too late for that now, though, if you've acted like you're the owner up to this point.

norabird

  • Walrus Stache
  • *******
  • Posts: 5365
  • Location: Brooklyn NY
Re: How to address raising roommates' rent?
« Reply #7 on: February 03, 2016, 10:15:33 AM »
Thanks Jack! Passing the buck is an option here. They do know that it's my parents who own it. Looking back, I have really been quite the baby on this. The costs on the apartment are $2400, there are three of us, and $800 isn't an outrageous burden. Of course it's a big jump so it needn't all happen immediately but it certainly absolutely should happen. Hopefully getting over or pushing past the uncomfortable feelings will help me grow in this area.