Sharing a house with unequally sized bedrooms -- what rent?

I am renting a house with two friends-of-friends. (I think I’ve received all the useful general advice on the subject, so feel free to chip in if you feel you must, but I have heard most of the “find out if they play loud music” and “are they fiscally responsible” and “renting? you should buy” advices and taken them into account) It has two main floors, the lower being half hall, toilet, stairs and kitchen, and half a long lounge/dining room; and the upper being mostly three bedrooms with a bathroom. There’s also an attic taking up a whole floor which has a ceiling too low to be useful as a room, but good for storage and possibly a couple of desks for working/computers.

There are three bedrooms, a double one about twice the size of one of the other two. We’ve provisionally agreed which of us will use the large room (I hope I won’t offend anyone if I say I think I might get usefully impartial advice if I don’t say if that’s me or not), and that they will pay slightly more rent.

The question is how much. What proportion do you think is fair?

Well, since the bigger room isn’t a master bedroom with its own bath, it probably shouldn’t be all that much. The best way might be to sit down and just decide who’s willing to pay the most for the room. Does the room have any other advantages? Which of the bedrooms share walls with others? Do any have cable and phone hookups?

You have six rooms. Divide the rent into sixths. Everyone pays for three rooms. The remaining half should be divided into 1/4 & 1/4 for the small bedrooms and 1/2 for the big one, or 1/6th more of the total rent. (1/2 instead of 1/3).

I was in an almost identical situation for just over four years. For the first two years, i was in one of the smaller bedrooms, and then for the rest of the time i was in the large bedroom.

We all paid virtually the same amount. I think the person in the large room paid an extra ten dollars a month, simply because the rent didn’t divide perfectly by three. So, i think it was something like $430 a month for the two people in the smaller bedrooms, and $440 a month for the person with the larger bedroom.

It just never seemed a very big deal to any of us that someone had some extra space in their bedroom. Most of the time spent in the bedroom is spent asleep in bed anyway, and most of one’s waking hours are spent in the communal parts of the house.

If I am not mistaken, this is a classic economics question. Is this an assignment by any chance? I think the right answer is that there should be an auction among the room mates to see what people are willing to pay

OK, here it is.

Yeah, go with the auction approach. It’s the only way to avoid hard feelings. The larger room is only worth more if somebody is willing to pay more than 1/3 of the rent to use it.

-lv

Wow, I wasn’t expecting an official answer. No, seriously, I really am in this situation.

But am I missing something with the auction approach? Why does is avoid hard feelings? If Persons A and B would both like it, but A can’t afford to pay any more, and B can, does that mean B should automatically get it for no extra? It doesn’t feel fair. Or should A bid B up a bit always hoping to be outbid. But then A could do that if they didn’t care just as well, and there’s always the risk A will have to renege, and what then?

Or are we supposed to each ask ourselves fairly what we’d pay for it if we could, and then the highest bidder pay the middle price?

Shade:

I think the idea is that the bigger room is more desirable, no? I mean, if you were all paying exactly one third of the rent, then ideally you would like to have the big room? So, you need to find a way to determine who gets the large room.

Say the rent (for convenience’s sake) is 300 a week. This means that, all other things being equal, you’d each pay 100 a week. Now, we need to throw into the equation the fact that there is something in the house (the bigger room) that everyone would like to have. The question is, how much more than 100 a week are you willing to pay for the privilege of having the big room?

If no-one is willing (or can afford) to pay more than 100 a week, then you’re left with having to allocate the room some other way (e.g., draw straws, come to a mutual agreement, etc). But if someone is willing to pay more than 100 a week for the bigger room, the question becomes how much more?

If person A says he’s willing to pay 110, and no-one one is willing to pay more than that, then you’ve solved the problem. Person A gets the room and pays 110, while persons B and C pay 95 each.

But if person B says that she’s willing to pay 120, then you have to ask whether anyone is willing to go over that. If no-one can beat 120, then you have your solution: person B gets the room and pays 120, while persons A and C pay 90 each.

And so on.

In economic terms, this essentially allows each member of the house to ask himself or herself what the marginal value of the large room is to him or her. And also to ask what is the opportunity cost of paying more for the larger room. The person for whom the room holds the highest marginal value will bid that value and pay that amount for the room.

Now, i tend to agree with you that a system like this doesn’t necessarily avoid hard feelings. The people who can’t afford the large room (for whatever reason) might feel envious and annoyed. That’s always a possibility. But, the economic argument goes, using a system like this at least means that the room is allocated using a rational system in which each person has equal opportunity to decide how much the room is worth to him or her, and to bid accordingly.

Now, while i belive that the economic logic here is sound, i’m also of the belief that a shared household is more than just a cave for homo economicus, and that people in such a situation usually base their relationships on more than the idea of rational maximization. If you feel that the economic model is likely to undermine the social bonds of the house, then don’t use it. But just remember that, in the absence of such a model, there is always going to be a certain arbitrariness to determining who gets the room and how much they pay for it.

Good luck.

Really the auction idea is the most fair, but there are a couple other ways:

You could keep the auction idea but use household responsibilities instead of money–then it essentially becomes a matter of who is willing to give up the most energy and time, something that is more equitably aportioned. For example, you could all pay the same rent but the person who gets the bigger room could agree to vaccum and scrub the community bathroom once a week, or take out the garbage, empty the cat box, and mop the kitchen floor. I’d give upa bigger bedroom for someone who agreed to mow weekly all summer so that I never had to deal with it. This would really only work with people who knew each other pretty well, not so much with friends-of-friends. One huge potential problem I see is if they just don’t do it–though that’s no different than if they just don’t pay rent–or if they do it, but do so irregularly and to a lower standard than expected. Pretty specific descriptions about how well and how often would have to be laid out.

Another way to do it would be to find desriptions of apartments or houses in your area and see if you can determine how much a larger bedrom or an extra bedroom with no bath affects rent, and extrapolate. Be careful about the bathroom issue–in my experience, the difference between a 1 bdroom/1 bath and a 2bdroom/1 bath is much, much less than the difference between a 1bdroom/1 bath and a 2bdroom/2 bath. The % difference between a 1 bdroom/1 bath and a 2bdroom/1 bath ought to be the absolute most the extra space is worth.

OTOH, these feelings can be partially subdued by the fact that he’s paying that much less for the room that he is in.

If all three people are paying the same rent, then the people in the smaller room can feel envious and annoyed that they are paying as much as the person in the bigger room. (Although this way works best if the room assignment is completely random, drawing cards or whatnot.)

If you artificially place a price on each room based upon size, then the guy in the big room can feel envious of the cheaper price of the other rooms, annoyed that he’s paying more than what he feels is the fair share, or whatever.

The only “everybody wins” case is the auction approach, where the price of the big room gets settled on the open market. The guy who “wins” gets the room, and the “loosers” get cheaper rent.

I was in each of these situations at different times. In the assigned price house, 3 out of the five of us thought it wasn’t fair by the end of the lease. What actually happened at the auction was that nobody really wanted to pay more for the big room, most of us just wanted to pay less for the cheaper rooms. So we ended up cutting cards.

-lv

If you really want to do this thing fair, without considering advantages such as windows/proximities/decor etc. You should take an accurate measurement of the entire living quarters for the house ie:1500sq’ and divide that by whatever the total monthly rent is. That’ll give a price per sqaure foot total on the house rent. Then using that price figure the rent on all of the house except the bedrooms. Divy that among each tenant.
NOW each bedroom has Xnumber of square feet multiplied times the price per sq’ will give you an accurate and fair representation of each tenants rent. Add the house rent plus the bedroom rent for each person and there it is. Easy as pie. :wink:

I had a situation like this my last year of college. My roommates room was easily twice the size of mine. She paid $100 more a month in rent. That seemed pretty fair to me (the total rent was $1050/month).

I new of two women who had a similar situation and had agreed to pay equal rent but trade rooms halfway through.

[pats self on back] Oh, yeah! I’ve never taken a single economics class in my life and this is exactly what I was going to sugest.

Rent should be proportional to square footage of bedroom PLUS common areas.

Nope, you’re all wrong. You’re making it way too complicated. Here’s what you do;
Draw lots. That’s right, short stick get’s the smallest room and so on. Permanentlly, no rotating. Everybody pays the same, so all the common areas are shared equally. If one of the roomies (heh) moves out, then you can move up by seniority, original lottery still holds. The newby gets the smallest room.
Peace,
Solomon
er, I mean
mangeorge

I was in this situation in my first apartment. I got the bigger bedroom because I had more stuff and a bigger bed, but she got the covered parking space. Rent was unequal I paid $334 a month and she paid $333 or something, so we didn’t have to split up cents.

I lived in a situation like this. 4 people (1 couple) in a 3 bedroom house.

The couple got the largest bedroom. So that left the master bedroom (smaller than the largest room, but had an en suite) and a smaller bedroom. We decided that I would have the master bedroom, and the other guy would get the garage.

There were two other bathrooms, so every buddy had their own bathroom that they had to maintain and clean.

And everything was split 4 ways. This worked out very well for 3 years.

Gotta love the good ole college days!

MtM