Category Archives: Real Estate & Rent

Relationship & Life Next Steps: Moving in Together

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I’m 28 and this March my boyfriend of 6+ years will turn 30. Even though I’m quite content with my current arrangement — living with two roommates and paying $650 a month in rent, while my bf lives at home in the back of his grandparents/mothers house.

But I’m also wondering, what’s next?

I’m ready to take the next step and move in with my boyfriend, and he’s ready to move in with me, minus the logistics. My rent situation right now is financially smart, and he’s not even paying rent (which works since he’s working PT and quitting soon.)

Looking at our options:

Stay in our current situation until we get married: Rent will stay $650 / month for a while, my landlord rarely increases rent and I just had a $15 / mo increase. Probably the smartest move. We’ll move in together in 2013/2014 after we get married.

Rent a 1br Apartment: This will likely cost $1600 – $2000 / month. Even split between the two of us, that’s $800 / mo at the very cheapest, more likely $1000 / mo for each of us.

Buy a 1br Condo: $600k? It’s hard to figure out the exact costs of owning a 1br condo, but it seems like this will end up being quite a bit more than renting given HOA, taxes, and other fees.

Buy a house w/ an in-law: My bf’s parents currently do not own property. His mom lives in her parents house, and his father rents an in-law. His mother could feasibly help us out with a downpayment, and his parents could live in an in-law on our property and pay us rent.

Still, the best plan seems to be to stay in my current living situation. Paying $650 a month in rent means I can possibly save $50k per year. The second my living situation changes, my hope of saving $250k by 30 disappears. The house I want to buy when I have a family will likely be $1.5M, and my bf currently has $0 in savings, so it’s up to me to be able to afford that. If I can get to $500k in savings by 35, maybe I can buy a $1.5M house. I’m not sure if that’s enough, and I’m also not sure I can get to $250M in savings by 35 — I think if I spend the next seven years living with roommates, not with my boyfriend, I could do this. But that’s a long time, and I really want to start living my adult life with my boyfriend in our own place, so we can invite friends over for dinner and such, and so I can stay with him and not have to worry about not having my things and having to run home before going to work in the morning.

Meanwhile, if I save $500k by 35, I’ll be able to buy my (nice) childhood home outright in New Jersey! It’s crazy how cheap the housing is there.

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Rent Increase: Just 2%

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My roommate informed me that our landlord is raising our rent in 2012. I was worried it was going to be a huge increase, given we haven’t had rents raised in a while, and at my last “property management-owned” complex where my rent was increased 22% the first year and 18% the next (from $900 to $1100 to $1300 when I finally got out and got roommates again.)

My rent started out at my current place at $602.50 for my room (I share an apartment with two other girls.) Shortly after I moved in my rent was raised to $632.50 per month, which was still less than half of what my former studio was charging. In 2012, my rent will go up to a whopping $647.50 a month. I just looked up the current cost for my old studio, and it’s now listed at $1570 – $1705 per month! For a studio! Yikes, I’m glad I left. That would be eating up half of my income now, and back then it would have eaten up all of it.

However, looking at my old apartment rent increases is a good reminder how important it is to try to get a yearly raise to at least keep with the rate of inflation, and hopefully a little extra. Since the beginning of my career, I’ve managed to take my raises by switching jobs and factoring in what I should be making, even if I never got a raise at my earlier company.

However, now that I plan to stay at one company for a long time, I know I must focus on figuring out a way to obtain reasonable pay raises or better in the coming years. I’m not too concerned about the price in rent at my current apartment, but what if my elderly landlord decides to sell the condo for one reason or another, and I have to move to a place that costs more.

How much do you pay for rent? How much did you pay in 2010?

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Maybe it’s time to buy my own place…

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It’s not what you think. I’m not determined it’s time to buy my own place because the housing market is down and mortgages are still low, though that’s part of it. Given I’m not sure how low the market has really gotten in Silicon Valley, the $500k 1br condo prices don’t really merit jumping into the housing market. I’ve all but accepted that my rental days are only numbered by the days between rent, not the time I’ll be living here.

But then there are nights like this. I hate feeling like an old stodge, but I’m rarely home, and tonight, on a Saturday night granted, I’m home sick, in bed, asleep, at 2:30am, and my roommate comes home from a night out with her sister who is in town visiting, and she seems to forget she has a roommate who is sick and asleep. If it were midnight, ok, I’d get over it, but it’s 2:30am. They’ve been bouncing a ping-pong ball as well for some reason. While the noise has all but simmered to a murmur now, the damage is done. I’m wide awake (hence the reason for this blog post.) Perhaps my sanity is reason enough to buy my own place.

In the meantime, today I read a bit about the markets, and freaked myself out over the potential to lose all my cash, even with a switch to more value investing. I’m not stupid, I realize that’s a risk with investing, but suddenly I’m thinking my $60k in stocks might be better spent on the downpayment for a condo. The dollars still don’t add up — not unless I want to be the on-site landlord to roommates, and I’m not the responsible type who would be up for that challenge/drama.

So it looks like rent is still in my foreseeable future, as are nights like these.

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She Really Doesn’t Want to Move

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In 3 months, my two roommates will be moving out. And I will either be moving out also, or have successfully found two new roommates. Stressful moments of being a renter like these are the few times I think paying for a mortgage would be worth it. (Then again, in the Bay Area, the only place I could afford would be crooked and vertigo inducing or burnt and dirty — see the San Jose Mercury News cover story on Bay Area homes you can buy for the national medium home price.)

Today, I met up with a girl i know who has an apartment in another Silicon Valley City. It’s a 2br/1ba. Her roommate is moving out in July, so the plan today was to look at her apartment and extra room, and then for her to come look at my apartment. Her apartment is very small and, well, it feels like an apartment. It doesn’t feel like a home. That can be fixed, but it’s just so tiny. And the rent is higher than my current place because it’s a 2br. So rent there for a room that’s smaller than my current room in an apartment that’s not as nice would be $725.

My place is a 3br/2ba with a large room for $770 and two smaller rooms for $635. Free laundry in the apartment. A pool in the complex. The apartment is right off the highway. It’s 30 minutes or less to my office. And the more I thought about it today, the more I realized… I really don’t want to move.

So, I could just tell the girl I met up with that I’m not interested in her place. I bet she’s going to want to stay there because it’s close to her bf. We also discussed looking at other places when it gets closer to July, but it’s such a pain because we both would have to give 30 days notice, and we couldn’t even really start looking until the month before we’d have to move.

And… moving, on its own, is expensive and a pain. Renting a UHaul, dragging all your stuff from your place to the next place, it’s just no fun at all. So I’ve decided that unless I find an incredible place to move to, I really want to stay here. The hard part will be finding two roommates. It would be nice if this girl wanted to move in here, into the cheaper room. That way we can rearrange the rents so the two cheaper rooms are $575 each, and the larger room is $870. I think that’s fair since the larger room is giant, has a walk in closet and a big closet, and a private bathroom.

Hmmm…. this is really bumming me out right now.

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Rental Prices Rising as Housing Stuck in Slump: Or, The Tiniest Apartment in NYC

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When people don’t want to buy houses (or are forced out of their houses because they can’t afford them) that means one thing: rental costs are going up. It’s a simple law of supply and demand. Reis Inc’s quarterly report showed the vacancy rate dropped to 6.2 percent in the first three months of the year, down from 6.6 percent in the fourth quarter. It was the steepest fall since the commercial real estate research firm began tracking the market in 1999.

Increased employment, especially for 20- to 34-year-olds, is spurring demand for housing. Many of those newly employed younger people, however, cannot come up with the tens of thousands of dollars often needed for down payments, turning them into renters. — Reuters

However, not everyone is letting rising rents get to them, even in the world’s most expensive cities. Renters, for frugal inspiration, 40 Year Old Felice Cohen — a professional organizer in New York City — shows that you don’t need to spend a lot to live in an expensive area, you just need to be, well, extremely organized. And be willing to sleep 23 inches from your ceiling. This woman spends $700 a month in NYC on a 90-square-foot closet apartment… closet. You have to see this (if you haven’t yet)…

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