For people who cannot afford to buy a home, renting is the next best option. But just as house prices skyrocketed during the pandemic, so rental prices also skyrocketed.
Average rents in May are up 2.3% from April, according to Zillow, and now stands at $ 1,747 per month. This is the largest monthly growth since 2015. This also represents an increase of 5.4% over May 2020.
The problem is that during the pandemic, many people’s incomes plummeted, so they cannot afford to spend a small fortune on rent. And even if you haven’t experienced loss of incomeIf you are on a low income or on a tight budget, $ 1,747 may be out of reach.
To be honest, $ 1,747 is the national average, and it’s no secret that some parts of the country are more expensive to live in than others. But if your rental payments are so high that you find it difficult to pay your other bills, here are a few steps to take.
Start your path to financial success with a bang
Get free access to select products we use to help us meet our financial goals. These fully proven options can be the solution to help boost your credit score, invest more profitably, create an emergency fund, and more.
By submitting your email address, you agree that we will send you monetary tips along with products and services that we believe may be of interest to you. You can unsubscribe at any time. Please read our Privacy statement as well as Terms and Conditions…
1. Reduce size
If you don’t have a lot of personal belongings and can move at an affordable price, then downsizing your living space may be a good solution for unaffordable rents. This assumes that you do not want to move to a less expensive part of the country. If you want to stay put, taking out the square footage can result in a much lower monthly rent. And then you can increase the size again when your financial situation improves or your income increases.
2. Find a roommate.
If you live alone, finding someone to share the cost of your rent can do wonders for your budget. Of course, not every living space is conducive to the appearance of a roommate. If you live in a cramped one-room apartment, you may not have enough room to squeeze a pet hamster into a corner, let alone another person. But if there is enough space, living together in a home for a while can be a worthwhile sacrifice.
3. Barter with the landlord.
If you are good with numbers or are good at numbers, your landlord can use your services, be it home renovations or accounting assistance. If you’re willing to take the time, you may be able to reach an agreement where you can offer the service you need in exchange for a lower rent.
4. Look at the purchase
In some markets it is more affordable to pay mortgage to a house than to rent out. If you have money for a down payment or if you are eligible for a no down payment or low down payment VA loan FHA loanthen buying may be a more economical option. First you need to check what the house prices look like and what interest rate you are eligible for a mortgage loan to make sure the purchase is feasible and makes more financial sense than renting. But it pays run these numbers…
Housing prices are rising across the board, so it should come as no surprise that rents match this example. But if you can’t afford the rent, consider alternatives. It’s better than continuing to pay all that money for a roof over your head and putting yourself at risk of debt.