Wouldn’t it be nice if spending $400 per month more than I wanted to on an apartment would guarantee that the place would be ours? Yes, our 700-square-foot one bedroom, should we secure the affinity of our potential landlord, will be $2200 per month. Not even the commitment to pay that much for a relatively small (and outdated) place gets us immediate confirmation.
At least we have good credit scores. I ran mine again (*expletive* Experian for being the most scammy spammy company around) and I’m at 738. My boyfriend has a crazy good credit score over 760. I messed mine up with one or two late credit card payments in the past, but this was very clearly me forgetting the date to pay and not long-term collections type issues. However, the landlord seemed a little nervous when I told her I was changing jobs and going to work for a “startup.” I quickly responded “don’t worry, they’ve raised a lot of money. And we have enough in the bank to pay for a year of rent even if for some reason we ever did lose our jobs. Come on, how could you turn us down?
So we decided to apply for this place because, despite being more than we wanted to spend, it has most everything we want. Location is ideal, between our jobs, our friends, and right off of major public transportation so I can stumble home tipsy from any social or work events without the fear of ever getting another DUI or bothering my boyfriend to pick me up while tipsy when he has more important things to do.
In any case, I decided location was the #1 consideration for our next place (no use being miserable with a long commute to work in traffic or being able to get home after a work event up in the city.) Second, also on location, I was looking for a location that was close to food shopping, and this new place is a short walk to Trader Joes and Whole Foods (nice!) plus Target for any more basic purchases. Third, I wanted a place that didn’t feel claustrophobic, which to me means rectangular, not square rooms, as much natural light as possible in an apartment (not downstairs apartments under someone else’s balcony and tiny windows), and a certain layout that felt less like a cookie-cutter box and more like a home (yes, even in under 700 square feet.) Oh, and it had to be a one bedroom with two distinct separate rooms separated by a door. None of this sliding divider crap.
Those were the must-haves. The nice-to-haves were 1. in-unit laundry, 2. upgraded appliances, 3. complex or nearby pool, 4. reasonable storage space for our bikes and stuff.
In this place we would get two out of the four nice to haves. I’d like 4-out-of-4 considering my personal rent will be increasing 100% from $650 to $1300, but it is what is. We’ll get the in-unit washer/dryer (AWESOME) but the appliances are fairly old (we’ll have more reason to be excited about upgrading when we buy our own place one day.) The complex does have a pool. Storage space is eh- there really isn’t a lot of it. At least there is a small balcony where we can keep our bikes, which was a major plus. It’s also nice that the balcony overlooks trees and not a carport or street. I love balconies to sit on and read or do work, especially when I am living in a one bedroom with my boyfriend. It’s a good spot to get away and spend time on my own.
So now, we wait. I have no idea if our application will get accepted. I’m trying really hard to advise myself that spending $1300 per month on rent when my pre-tax take home pay should be $10k before bonus is really not that big of a deal, but I’m less considered about the percentage of take-home pay and more in the whole going to work for a startup and who knows what will happen. I’m pretty confident that I can get another job should for some reason things not work out but it will take time and I’m also not sure I can get the same salary. That’s what concerns me.
But I remind myself that the studio apartment I was once renting for $905 year one and $1100 year two, over four years ago, is now going for $1700, so comparatively the quality of living at that place should be greater as a studio than half of this one bedroom. Meanwhile, my current apartment and rent is way below market. The same 3br unit popped up for rent down a ways in this complex for over $900 more.
The landlord just really likes my roommate and she’s been here for years now, plus her father is somewhat of a handyman so he has apparently fixed some things so the landlord didn’t have to. But I really can’t compare my current rent to market rate right now anyway. I would be hard pressed to find a room in an apartment for the same price today, and I doubt it would be possible to find one in a place so nice. My tiny room, if I moved in today, would probably be $900-$1000.
$2200 for a 1br then is not unreasonable. Split down the middle, that’s $1100 each. But as we’re going for a percentage of our income, he’ll pay $900 and I’ll pay $1300. Him paying less isn’t what bugs me. It’s me paying $1300. It’s me not knowing how secure my job is because it’s new and I haven’t worked with these people before. What if they hate me? What if I can’t do the job well? I’m confident I can, but one never knows until they start. My success will be numbers based so if I can’t hit the number I won’t be keeping my job. There’s a reason to be slightly concerned.
I figure if I were to go off right now as a single 30-year-old and say, hey, I deserve to live on my own right now – I’m making $125k and that’s enough to afford my own place – I’d end up spending $1400 or more on a studio. So really $1300 is NOT THAT MUCH. It just seems like a lot because my strategy has always been to keep housing/fixed costs low until I have a family to save as much money as possible. Income should rise, savings should increase, housing costs should remain as stable as possible with basic year-over-year increases.
Not counting my first place (which I had a $450 room in a 4-bedroom apartment), with cost of living increases $1300 is also probably quite reasonable. Consider 10% YoY rent increases, which is pretty normal around here.
2008: $995 [actual rent was $1100]
2009: $1094 [move in with roommates, paid $625]
2010: $1203 [$625 actual]
2011: $1323 [$625 actual]
2012: $1455 [$650 actual]
2013: $1600 [$650 actual]
So that explains why the studio I paid $905 for in 2007 is now going for over $1700. It also shows that I “should be” paying $1700 today to get what I got for 905 in 2007. And $1300 rent is not that bad at all. If I stayed at my studio I’d be spending a lot today, and moving into a place where I’d only have to pay $1300 would be a major relief! Plus I wouldn’t have saved nearly as much as I did in my 20s.
That makes me feel a lot better about spending $1300 a month. It really is reasonable. Now we just have to get the place. Fingers crossed. It sure isn’t perfect, but I think it will be a nice place for us to live together. It’s cozy. And if I need to get away on a Saturday I can hop on caltrain and head up to the city to wander around in just a few minutes, or go to any of the lovely towns around here that are right off the train. I really hope we get this place. It will be worth the expense.