March 25, 2021
How Do You Split Rent With A Roommate?
Deciding to live with a roommate can be a big decision!
Once decided, the next big question asked is how to efficiently split the cost of living.
Our team at Oddo Development has put together a list of ways to break down these payment options in the most cost-effective way. (You can thank us later).
Split All Costs Down the Middle.
This first option is most commonly used and simplistic.
Cost of living, no matter the size of the home or utility usage, gets divided into even portions based on the number of roommates.
This way it’s easy to combine all bills and simply divide this total number into appropriate parts. No need for additional measurements!
Divide by Use of Space.
The size of the home can also determine the amount each person pays.
Maybe you have chosen the larger walk-in closet, while your roommate got the master bedroom and attached bathroom. You might park in the garage, while they park in the open lot.
There are many ways to separate costs based on space usage!
An easy way to calculate this is to ask your leasing consultant the square footage of the whole home (all rooms included) and see who has a larger or smaller portion. Base the rent from there.
You can calculate the amount of rent per square foot if you want to get technical!
Take the square footage, divide it by your rent, and this should give you an average price per foot in each space. Use the information given from the office and add up from there.
Separate by Income.
This option is great for those open about their financials. Income is one of the biggest criteria to consider when choosing a home, as this ultimately decides your budget.
When your application is screened for approval, most companies look at a combined dollar amount from all adults on the lease to determine your outcome. However, your household will need to discuss budget limits each month including food, utilities, and other monthly expenses before applying.
We recommend including the utilities and additional cost in mind when giving a total. This way there is no confusion or stress once moved in and payments start coming.
Let’s assume you make more than your roommate in this provided scenario. Your budget for rent is $1000 a month. However, your roommate only wants to spend $700.
Total, you have a fair combined number but need to work out a plan for each person’s comfortable range. Not everyone will want to spend their top budgeted amount!
Separate this budget amount so that each person is paying only what was agreed on based on their monthly income and expenditure range.
Divide by Categories
Our last suggestion is also a common tactic among roommates.
Take all the bills owed including rent, gas, water, electric, HOAs fees (if applicable), etc. that are due each month.
Designate these costs by separating who will pay for each category. Maybe you take gas, water, and electricity while your roommate takes on the single rent cost.
Be aware when using this method that utilities normally fluctuate and will not always be the same amount each month! If you are wanting to separate costs fairly, keep in mind that the amounts will not always be consistent.
Remember, living situations can always change. Someone might get a raise or promotion that bumps up their income. On the opposite end, someone could lose their job and can no longer contribute finically. These options need to always be considered no matter the division of living expenses.
The best rule to go by, especially when living with a roommate, is to make sure you can afford the housing and utilities by yourself in case of an unplanned change.
If anything happens to either person(s) no one will be left with payments too large for them to singly overcome.
Which of these options do you find the most efficient? We would love to know!
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