Part 1 – Let’s Talk Money
Sharing a flat or house with a good friend can seem like a great idea. Not only will you be sharing the living costs, but you’ll have companionship as well. And with the costs of rents and living going up, this might be the only practical option of affording your own place.
However, it important to be aware of possible challenges and issues that could arise when you mix friendship with living together. Let’s look at what problems may occur and how they can be avoided (well mitigated at least).
Financial Friction
Nobody likes talking about money, but it can be one of the biggest causes of strain on your friendship when you’re renting a property together. The likelihood is that one of you will be on a higher income than the other. In everyday life that’s not normally an issue. But it can be when it comes to paying the rent and bills on time. You also have to consider unexpected expenses that either of you may incur. What happens if a car needs repairing? And sometimes, we all feel it when there’s more money than month left.
Avoiding Money-Related Disputes
Have an honest and open discussion before even looking at properties together. Each work out exactly what your outgoings are each month, before factoring in rent, household bills including Council Tax.
There are also some handy websites that can give you an estimated cost of your utility bills each month. These should be used as a guide only; they can also give you estimates of your council tax bill. Also don’t forget your internet and TV Licence. When you have an estimated cost of you monthly bills and rent. Can you both afford still afford it?
Here’s a useful website for checking average utilities bills
You’ll also need to factor in food costs, how frequently you like to go out socialising, travel costs. Be realistic when calculating what you can afford, if anything over budget for expenses that you’re not used to and always allow for a buffer. It might be useful to go through your bank statements and see how much you’ve actually spent on socialising each month.
It might even be worth opening a joint bank account, for the household bills. That way as soon as you’re paid each month, the bill money is transferred to that account. That way you’ll both be confident that all the bills will be paid each month. It’s also worth agreeing on putting a bit extra money in the bill account each month to cover unexpected household expenses.
Is the Rental Property Furnished?
Most rental properties come unfurnished, so you will need to consider what furniture, and electrical items will need to be bought when moving in. What will that look like? You may decide that one of you will buy a fridge and the other a washing machine and those items are yours when you move out. You may decide to buy everything jointly.
There are also things to consider as far as taste in furniture. Yes, a washing machine is a washing machine at the end of the day. But what about the sofa, a dining table and chairs. How close is your taste in décor and does your budget for these items line up with each other?
There’s also the option of second hand furniture, how do you both feel about that, it saves money initially and items can be replaced later on.
Have a Written Agreement
It doesn’t have to be a legally binding document, but it will help, if you agree to terms regarding anything financial before you move in together. You should also include agreements about large household items that have been purchased for the new rental property. Agreement on financial split of unexpected household bills.
The more that you can include in the agreement, the better. It will give you both peace of mind that you know what your responsibilities are. It will also help you keep the financial side of renting together more like a business agreement, which will help to protect your friendship, if problems occur.
This was the first in a series of articles that discusses the pitfalls and how to avoid them with living with a mate.
Contact us on 01604 603450 if you’re looking to rent a property with a mate.
I have had 2 rental properties with Cotters for 11 years now and have dealt with Jo, Carol and Sue and I have to say I couldn’t find a better letting agents if I tried. They are and have always been extremely friendly and actually care for their tenants. They go way and above beyond to help and always respond promptly to calls.
Thank you for being so kind, professional and supportive over the years!