We all know that home prices are soaring on the West Coast. Couple that with high rental prices, and what do you get? According to a recent report by Trulia, it turns out that the number of married couples living with roommates has doubled since 1995. Due to the high cost of living, perhaps it isn’t surprising that Orange County is one of the areas in the nation where this is more common than ever. In fact, married couples in Orange County are four to five times more likely to live with roommates than in other areas of the country.
In the United States, there are over 280,000 couples that live with a roommate. With real estate being so expensive, many couples who are able to buy a home figure that they can offset the cost of living by charging rent for a portion of the home. Though it may be a sacrifice to share their space, it is the cost that many couples are choosing to act in a financially responsible way. It is interesting to note that it is more common for married couples who rent a home to bring in a roommate or two than for married couples who own a home. Why is that? Typically, when a home is bought, the housing expense is fixed, however with rentals, many times the rents will increase year after year. I’ve run into couples who have faced rent increases of as much as $500/month, which can be challenging for couples to afford. When it is possible, it can be easier to bring in a roommate to help ease the pain on their pocketbook.
MarketWatch provides some good insight into some of the various reasons that married couples consider taking on a roommate. Many still want to have disposable income to enjoy a certain lifestyle. For instance, traveling, nice cars, fine dinners—all of these hobbies can fall to the wayside if housing expenses are eating up the bulk of the budget. However, a roommate can help defray those expenses.
This arrangement can also be beneficial to the renters in this situation. After all, rents are sky-high all around Orange County. According to RentJungle.com, the average rent in Newport Beach for a one-bedroom is approximately $2,000/month, and in Laguna Beach it is a whopping $2,662/month. Since renting a room is often less expensive than a private apartment and offers a financial advantage, it’s a win for the tenant as well.
By Holly Schwartz McDonald
Holly Schwartz McDonald is a Realtor with Villa Real Estate who lives in Newport Beach and has been featured on HGTV’s hit show, “House Hunters.” She can be reached at HMcDonald@VillaRealEstate.com.