If you are planning a move, you know how stressful it can be. First you have got to get out of the place you are in now. Whether you are renting or own a home, there are steps you need to take in order to leave the place in which you live. If you rent, you simply do not sign another lease. If you own, you may need to sell your home prior to moving. Then you have to look for a new place to take up residence. This is where things get tricky. When looking for a new place, you have to take our budget into account. How do you know how much money you can afford to spend on housing each month?
What is your situation?
It seems that since the day I turned 18 I have been moving and I’m growing tired of it rather quickly. When I was 18 I moved into the dorms at the college I attended. That was my first time out on my own (without my parents). I only lived on campus for one semester before moving back home. Four short months after moving home, my fiancée and I got apartment with my mother. We stayed in that apartment for two years and then moved into a house that we rented from family friends. After a little over a year there, my fiancée and I moved to Pittsburgh, Pa. from Charlotte, N.C. and resided with family there for nine months before I returned to North Carolina alone. Once I was here, I lived with a roommate for five months and now here we are again… moving.
Each time that I moved there was a different reason behind leaving the place beforehand. Your reasoning behind making a move could affect your financial stability and ability to pay certain rent or mortgage amounts. For instance, if you are moving for a new job that pays you more than the one you held previously, you will be able to afford more in rent or a mortgage than you would have in your location prior to accepting the job. Likewise, if you are moving into a smaller apartment because of a pay cut you will have to adjust your mindset on housing accordingly. With each of my moves, I had something causing me to move that may have affected my financial well-being.
Accessing Your Capabilities
Being capable to pay your rent each month on time is necessary so before you move out or move on to the next place that you will rent you need to fully access your budget from the ground up. Once you’ve pinpointed the reason for your move, you need to get a good idea of how much money you will actually have once you get there. Here’s an example:
If you make $2,500 a month and plan on moving into a growing city, you may find that you suddenly don’t feel like you make enough money. The average rent in Charlotte, for instance, sits around $1,500 a month. That would leave you with $1,000 leftover each month. That seems like pennies when you’ve got an electricity bill, water bill, car payment, car insurance, groceries to pay for and other miscellaneous bills to pay.
Experts say that you should only spend one-third of your annual salary on housing. If you take the same example of the individual making $2,500 a month that person would only pay $833 per month in rent, leaving $1,667 for other bills and savings throughout the month. Locations with this price range, however, tend to be more competitive and can be difficult to get into.
Finding a Place and Weighing Your Options
One thing that I have found is that if you are looking for a place within that one-third of your monthly salary, you may want to look a little further away from work. Many people work in the city or more urban areas, however, if you go outside of those areas you can actually find really decent places to live for fair prices. This may mean more of a commute but it will save you in the long-run. When I rented my first apartment, we rented just 25 minutes outside of Charlotte. Instead of paying $1,500 or more a month, we paid only $750.
If you cannot find a place that only costs one-third of your monthly budget or less, consider getting a roommate. Although roommates can be difficult at times, being able to split the rent will greatly help your cash flow. For instance, if you spring for the $1,500 a month apartment and acquire a roommate you will only pay $750 a month each and you’ll be able to split all of the utilities as well. Also, every once in a while you may find a roommate that you actually enjoy living with.
Whether you are about to make a move across the country or across the city you live in, each of these points are important to consider. Remember to figure out why you are moving, access your ability to pay a monthly rent or house payment and find a place that will suit your budget. Happy hunting!
Photo: Flickr: don toye