Monday, June 15, 2015

2 Questions to Consider Before Moving Out!

On August 1, 2015 I'll be moving out of my parents home and living on my own for the first time. I've talked to a lot of my friends and have spent months researching online to make this move as stress free as possible. Here are some things I had to consider:

How much can I afford to pay per month on a home?

This question is the most under examined budgeting question. One often cited figure for housing is the "30% rule". The "30% rule" is based around the assumption that you should not spend more than 30% of your income on housing. While the "30% rule" is often disputed I believe in it. I have five years experience in the Florida housing market and almost every time someone extends themselves past 30% (housing/income) a financial collapse shortly follows. Housing costs also include more than just your rent or house payment. Utility costs should be compared between potential dwellings. I often see a scenario where two houses of the same size can have drastically different utility bills under the same use scenario. If you are tempted to move into an older or less efficient home consider: Are you willing or allowed to make energy efficient upgrades to the dwelling you choose? Is it cost effective to make these upgrades? The cost of maintenance should also be considered. With home ownership you are responsible for maintenance costs that aren't covered under insurance. However, renting doesn't always mean that you are free from maintenance expenses. Often times air filters, lawn maintenance, and pest control are not paid for by landlords. Sometimes even small repairs are required to be paid by you. Thoroughly read over any application and lease before signing and compare it to the landlord/tenant law statutes governing your area.

Where will I live?

Which location is convenient to locations that matter the most to you? Is the neighborhood safe? Before settling on a location drive through the area at different times during the day. Does the area around your dwelling flood when it rains? Once you settle on general location you can start finding which dwelling fits inside your financial requirements.

My Decision

I chose to rent a three bedroom/two bathroom home. This house gives me plenty of space for my home office and has a guest bedroom. The house has been remodeled and is EnergyStar and WaterSense compliant. The property has an attached garage along with a fenced yard for security. Due to maintaining my own privacy I won't share the address or the rent amount. The rent amount does follow the "30% rule" and I look forward to saving towards owning my own home in the future. Housing is the first issue (after employment) to consider when moving out. As I encounter more experiences I'll post about them. I hope this post helps you if you're considering moving or  moving out. Please comment to share your experiences with me!

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