Comments on: Some Thoughts on Cohabitation as a Financial Tool

By: Mary

Mary — Thu, 04 Mar 2010 14:50:07 +0000

Just want to say I love your posts just for the fact that I learn something new every day,and get to hear other people’s points of views on a myriad of different subject matter. Keep up the good work! Mary

By: Ruby Leigh

Ruby Leigh — Wed, 03 Mar 2010 21:14:44 +0000

For the most part, We love having roommates. There are some challenges, but usually it’s like having closer friends. It also saves us money. We own the house so we just set up a landlord/tenant contract for them and their room. I can usually get a pretty good feeling on whether someone is going to work with our lifestyle from the begining and I avoid anyone who want to “barter” unless I know them personally. We don’t have a lot of upkeep at our house, so there’s not much to work with.

By: Kate

Kate — Wed, 03 Mar 2010 20:10:49 +0000

I think the responses to this post are really interesting, and speak volumes about the things our different cultures value.

Many of the posters here are coming at the idea of cohabitation as something you have to do because you’re in dire straits, an imposition on freedom and privacy, a set of drawbacks to put up with/avoid at all costsetc. It’s a very individual take on things.

By contrast, I suspect some cultures (including my own!), come from a perspective where cohabiting is a benefit, an opportunity to grow closer to family, to learn about another culture, to enable opportunities that we wouldn’t have otherwise.

My in-laws lived with us for a while, and it was a wonderful arrangement. It allowed them the security of knowing someone was home in case anything happened, let us help out as they aged, let us spend time with them as time became a more precious commodity, not to mention the finances…

By: John S

John S — Wed, 03 Mar 2010 15:18:59 +0000

Yeah, sorry Trent, but I roll my eyes every time I see you suggest cohabitation. I cannot think of a faster way to turn friends into enemies, nor an easier way to lower one’s overall standard of living.

What good is saving money, if it drives you crazy and gets you down to your last nerve, and takes away the sanctity of the one place in the universe where you could control your situation?

That’s what you’re giving up when you cohabitate: control over your last bastion of privacy and personal space. It isn’t worth it.

Better than being out on the streets? Sure.
Tenable, if there is any other alternative? Not for me. I’d bet not for most people.

By: deRuiter

deRuiter — Wed, 03 Mar 2010 12:17:27 +0000

Neal, non profit housing is perceived as bad for a neighborhood because it attracts an undesireable clientele who are in that situation because of inability to manage their lives well. Domestic violence shelters bring domestic violence because the women keep telling their abusers where they are, other shared housing is for the mentally disturbed, the emotionally disturbed, alcoholics, drug abusers, and similar people peole who exhibit problem behavior. There is more turmoil around a group home, and the neighbors resent it. Non profit housing attracts those without full time jobs, so you have a lot of poorly adjusted people roaming the neighborhood, clustering in the yard. The neighbors see this as their tax dollars being used against them, supporting problem people who are then foisted, with their problems, on the taxpayer’s neighborhood. The neighbors also see, rightly or not, a danger to their children from people with problems.

By: deRuiter

deRuiter — Wed, 03 Mar 2010 12:10:29 +0000

House sharing is a great way to save money and not lose a piece of property. If it’s really sharing a house, kitchen, yard, etc, consult tax professional because a house sharing arrangement would most likely no be considered “rental income” which is taxable. Look to renting auxiliary structures: garage space, storage shed, basement storage. ANY shared living arrangement reuqires STRONG written lease agreement. Never do it verbally, and when you write, spend $25. at legal aide to have it looked over by a lawyer because if it’s not legal, you can’t enforce it. Don’t forget the clause which says, “If any part of the lease is unenforceable by law, the rest remains in force.” Also get the highest security deposit allowed by law. If they can’t come up with security, even a relative, YOU DON’T WANT THEM AS A TENANT AS THEY WILL NOT PAY THE RENT. Put in a DAILY late fee and enforce it the first time or evict, it is amazing how people will walk all over you if you let them, but behave well if you treat it as a business. You can discriminate if you are renting out part of your own living space (you and them in one unit), but you are not allowed to mention discrimatory terms in your lisitng. If the person who comes to look does not suit you, do not rent to them, tell them you will get back to them. It is different from renting a housing unit where you can be whacked $10,000 for discrimination. Best plan is to talk to the potential tenant at length over the phone, you learn much this way, people reveal themselves this way, “I need a place because I’m suing my current landlord.”, “My family threw me out for drugs.” and “My two pitbulls bit a kid so the landlord is evicting me.” are all hints that this is not the person for you. As a person with a number of tenants who have lived happily in my rental units for 5-16 years, I can tell you, if you pick a gem, you’ll be happy and prosperous. No point in losing your home if you can save the situation by renting space. “Oh, I could never share my house.” from a person approaching foreclosure, shows a lack of good sense, better to give up a bit of privacy and preserve the real estate is my thought.

By: Neal

Neal — Wed, 03 Mar 2010 01:56:43 +0000

How do you feel about cooperative housing, in which members own the house via a nonprofit corporation, and allocate maintenance, cooking, and cleaning among themselves?

They are a great option for college students and I could not have afforded college without them. I do not understand why people in the US are so hostile to nonprofit housing.

By: Jeannette

Jeannette — Wed, 03 Mar 2010 01:40:55 +0000

The few people I’ve known who have done this as older adults (divorced, in forties, or older), who did this because they had to, had the best experiences renting to people who had similar lifestyles and experiences. (Single mom with kid rents to another single mom with kid. Divorced male or female with another divorced male/female of same age group.)

Even the nicest, most financially responsible people can make bad roommates because of their personal habits, which, while not “bad” can be difficult for the home owner.

To wit, the issues of noise (playing the TV, music and/or talking on phone and can be heard at all hours of day or nite), entertaining (are you prepared to have your roomie bringing people over at all times of day or nite?), cooking (You don’t have to be from another culture or country to be cooking exotic and/or odiferous foods), food storage space in fridge and the like. Clean up is a key issue for many because some people are both lazy and sloppy as well as outright dirty. And no, you can’t tell that till you live with them. Some people end up not sharing or ending it over the condition of kitchens and bathrooms (sharing bathrooms is VERY difficult.)

Cause unless you have a big house, really good insulation and a huge kitchen and more than one bathroom, there can be major challenges (Think: Two people cooking two totally different meals in a NYC-size apartment kitchen or even a house without a big kitchen).

Temperature, believe it or not, can be a flashpoint. I’ve shared with people who hated AC and others who had to have it on practically all year. (An issue whether or not you have central air.)

In many cases, if it’s about finances, it’s sometimes easier to rent out your entire place and then live somewhere else that is much less expensive. A few people I know have found this easier to do. Depending on rental rates where you live, you can sometimes do much better financially.

Sometimes, it’s easier for YOU to move in with someone else you already know and rent out your place.

By: Nicole

Nicole — Wed, 03 Mar 2010 01:26:35 +0000

sense of privacy or Home Owners Association

Some of us can only rent our homes out to relatives because of old prostitution laws.

By: ChrisD

ChrisD — Tue, 02 Mar 2010 23:30:24 +0000

My parents have a big house/empty nest and have their name on the register at a brain hospital. We get loads of foreign brain surgeons working/studying in London for a few weeks/months. All these people have family and friends at home and just come here to study/work. They make the ideal tenants. The deal is that they share the kitchen (and are expected to leave it tidy) but they more or less stick to their rooms and don’t have parties or guests. They have no cleaning responsibilities outside of their own rooms and everyone shares two bathrooms which works very well.
Improving your finances with the rent is so much better than an empty room, not to mention the company and meeting new people. I feel sorry for anyone whose sense of privacy keeps them from this option.
My parents don’t do background checks or ask for references, or even meet the people before hand, the brain surgeon part seems to work quite well as a proxy for reliability. If you are letting a room in your own home, you have more rights than a normal landlord/tenant agreement and can kick the person out much more easily than if they rented a self contained unit from you.

By: jgonzales

jgonzales — Tue, 02 Mar 2010 23:15:02 +0000

I think the barter system can work, but it should still be in writing. The family who owns my apartment complex has about 5 or 6 total. On site I have a manager, maintenance man, and landscaper. They all receive a discount on their rent (and possibly free rent, that I’m not sure). They all also do a lot of work for the family who owns it. Both the maintenance man and the landscaper do work on all of their sites. The manager only works here, but she does continual work to keep this place in order.

It’s written into their lease agreement that they are bartering for at least part of their rent. It works well for them, plus the maintenance man and landscapers are professionals who bring quality work.

By: Monevator

Monevator — Tue, 02 Mar 2010 22:41:24 +0000

Another angle to the barter approach is that it’s tax invisible, too!

Handy if you’re formerly taking money for providing accommodation to the co-habiter and there are particular income barriers with respect to taxes (this is the case here in the UK).

By: Crystal

Crystal — Tue, 02 Mar 2010 20:02:05 +0000

Cohabitation with a significant other can save money too…just be sure to work out all the details beforehand just like you would with any other roommate.

By: Mule Skinner

Mule Skinner — Tue, 02 Mar 2010 19:47:33 +0000

I translated cohabitation to “shacking up”. Alas you had something else in mind . . .

By: Kerry D

Kerry D — Tue, 02 Mar 2010 19:26:14 +0000

For #9, what’s up? Are you sons adults? If so, why aren’t they contributing? Maybe they’re still kids… But, this was an important topic for our family recently.

My oldest just turned 18, and it was an important reality check that room and board in the family home were no longer a given. Amazingly, he went from a rebellious teen to a lovely (seriously) cohabitator nearly overnight… He has agree to the terms of living at home, which are to be a full time college student with passing grades, and to take on some responsibilities, such as picking up brother from school.

By: chacha1

chacha1 — Tue, 02 Mar 2010 18:49:51 +0000

This is of interest because I can see it as an option for my later years if/when I end up widowed. I’d think a written agreement would be essential no matter WHO was sharing space.

I would want to already own the property I proposed to share (i.e. I am the landlord). And I think each adult HAS TO have their own bathroom!

But it seems vastly preferable to living 100% alone in later years when daily interaction with another human can make such a huge contribution to mental health. DH’s grandma had a tenant for a long time, and they weren’t exactly friends, but just having another person around makes a difference.

By: Laura in Seattle

Laura in Seattle — Tue, 02 Mar 2010 17:21:09 +0000

Johanna: One of my old landlords had a barter arrangement that worked really well.

The house we were all in had 6 bedrooms that were rented out. There was also a small trailer in the side yard that was rented out.

The landlord would advertise the trailer as “X/month or Y/month + labor.” The renter would agree to do some set number of hours of work around the house per month. The landlord set the rent discount based on what it would cost him to hire that labor. So, if he needed 10 hrs of work at $15/hr, it would be $150 off the regular rent price. The trailer renter would then complete that work (repairs, yard work, fixing a busted knob on the back door, whatever) on a month-to-month basis. If at any point either of them was dissatisfied with the agreement, they’d simply give the other 30 days’ notice. It worked out very well.

By: Johanna

Johanna — Tue, 02 Mar 2010 17:05:12 +0000

@Kai, J: Well, yes, of course it has occurred to me that I could charge more for rent and pay for maintenance/repairs out of that. But Trent brought up the bartering possibility, so I thought I’d ask if there was a way to make that work that I hadn’t thought of.

As I said, though, this is all hypothetical for me at this point, since I don’t plan on moving out of my rented one-bedroom apartment any time soon.

By: J

Tue, 02 Mar 2010 16:49:14 +0000

@Johanna – When I see people trying to do cute things like the barter/below market thing, it inevitably leads to weird stuff happening and people getting pissed off. Like the guy I knew whose was boarding and whose landlady didn’t want him to report it on his taxes (in my state you can get a tax deduction for rent). There’s a reason people sign contracts and set up a business relationship as landlord and tenant, it’s based on hundreds or thousands of years of human history and suffering.

If you don’t want to do labor and maintenance yourself, set the room rate to include the cost of a lawn service and upkeep. You can get quotes for a few landscaping companies to set the rate.

One of the best ideas I’ve had from someone who had roommates for a while was splitting the cost of a cleaning service. It ameliorated the whole “I live with slobs/neat freaks” discussion very well, since the clean freak didn’t fee like everyone’s mother and the slobs could be slobs.

By: Stacy

Stacy — Tue, 02 Mar 2010 16:46:35 +0000

I have made the decision to never cohabitate again, unless it is with a significant other that I am SURE about. I have had many horrible roommates, and even wonderful roommates who I didn’t get along with. I am not the type of person meant to live with other people long term. It is well worth the extra money for me to live alone at this stage in my life. SO worth it!!!