Why Witty Agents Get More Business
FACT: Your ability to attract clients has less to do with your “credentials”… and everything to do with how people feel about you. As a
Single Renters Are Paying a Higher “Tax” Than They Might Be Aware of (But There’s a Way Around It…)
If you’re a renter and live alone, it’s no surprise that it costs you more than if you had a significant other, or at least a roommate, to help pay the rent. But have you ever done the math on exactly how much extra it costs you?
According to this Business Insider article, it costs a single person an average of $7,000 more in rent per year than people with a partner or roommate.
The obvious solution to avoid this “singles tax” is to find yourself a significant other, or a roomie. But if you live alone, there’s probably a reason why you haven’t already gone either of those routes, like:
- If you don’t have a partner, finding a significant other isn’t something you can always just snap your fingers and make happen. Even if you could, rushing into a relationship to save on rent probably isn’t the best formula for a solid, lasting one.
- You just like your privacy and freedom and don’t want a roommate sharing your kitchen, living room, and bathroom.
- You wouldn’t mind a roommate, but you can’t find one—or at least one you trust or like enough.
- Your place is too small and you don’t have enough space to even share with another person.
But there is a solution which may not only lower the amount you pay in “singles tax,” but will also give you tax breaks! If you play your cards right, it could even cost you less out of pocket than your current rent, or (gasp) even make you money every month…
Rather than Pay Money to a Landlord, Why Not Become One?!
Buying a rental property with more than one apartment could afford you the luxury of living in your own apartment, while renting out the others.
While not everyone who rents can qualify to buy a place, many renters often simply think they wouldn’t be able to, and don’t even look into the possibilities. Rather than just presuming you’re stuck having to pay the “singles tax” until you find the love of your life (or at least a roomie), why not look into whether or not you can buy a rental property? Interested? Here’s how to go about it:
- Contact your bank or a mortgage company to get pre-approved for a mortgage. Let them know you’re specifically interested in buying an income-generating property, because that will affect whether you qualify, and for how much they’ll approve you to spend. At first they may give you a general idea about how much you could afford, based upon your income, assets, debts, credit score, and the average rents for the area. But they’ll want to know the actual rent amounts for a specific place you’re considering, which may affect how much they will or won’t lend you.
- Find a real agent to work with who understands multi-family houses and rental property. Do NOT just try and look for rental properties on your own by calling whoever the listing agent is. You’ll want an agent who can help you assess what your options are in the areas you are interested in, and advise you on what to look for in a property.
- Be willing to look for a property that “makes sense” even if it’s not in your ideal area. If the goal is to save (or even make) money, then you want to focus on the ones that make the most financial sense, even if it’s in another town or city than you originally hoped to buy one in.
- Be patient. Depending upon where you’re looking, there aren’t as many rental properties on the market as there are single-family homes. So you might have to wait for one to come on the market. If that’s the case, be ready to jump on the opportunity.
- Don’t get hung up on trying to time your purchase with when your lease is ending. It’d be ideal to buy one and close on it right when your lease is done, but it can be difficult, and finding a good investment property isn’t always easy, so don’t let one slip away. Try and find a way to either get out of your lease early, or carry the cost of both until the lease is up.
- Only buy it if the numbers make sense. That doesn’t necessarily mean it has to provide you with positive cash flow—which basically means it brings in more money than it costs you to own. It could just be that it costs you less per month out of pocket than you’re paying in rent on your own. That’s still a win. But do make sure to ask your agent to help you assess how much you should be willing to pay for it, given how much the rents are. In the least, you probably want to make sure the mortgage would be covered if you moved out and rented out your apartment to a renter, if not turn a bit of a profit.
The so-called “singles tax” costs $7,000 on average, but depending on where you live that amount could be less, or even more per year. Regardless of how much more it costs you to live alone, it’s not a bad idea to look into buying an income-producing property… because if you’re going to pay rent, it might as well be to yourself!
The Takeaway:
A recent analysis revealed that rent is costing single people living alone a “singles tax” of $7,000 more per year on average, than their peers who live with a significant other or roommate. A good way to try and lower that out-of-pocket amount, or even turn a profit, is to buy a rental property and live in one apartment, while renting out the others.
