@Scott Wolf thanks Scott. I work 9 - 5:30 Midtown Manhattan so the radius I had in mind was 1 hour subway, which is enough time to visit after work or on weekends. However I’m completely open to further areas since I plan on using a GC and PM, I’ll just need to learn a bit more about long distance investing and see what it will entail. Right now I’d love to know specific areas/neighborhoods that are affordable so I can narrow my search a bit. Thanks a lot!
I just started investing in Upstate NY, just north of Poughkeepsie. I think it's manageable up there, and you can use a PM company, as I am.
If you do, then soon she'll be your ex girlfriend. Let us know how it works out!
Nah. You don’t charge her rent. She should offer to pay for some utilities, groceries and other expenses though. She should probably even offer to pay a little rent if she’s in a position to. If you take her up on that.... up to you. If she has an issue with paying her way then you might wanna rethink the entire thing.
On a side note I love when I see my married friends venmo’ing their spouses for utilities and groceries and stuff.
Here for the replies.
@Daniel Lynch love this post... I house hack and my gf moved in with me last year. She didn’t pay at first and it caused some issues. It may seem awkward, but she now pays me $500 rent every month, and it has actually made things better between us. At first she had to fight me for extra space, but now that she pays I feel obligated to be more fair in the amount of space she gets for her things and decorative tastes, and expected household chores. It’s become our home instead of my home.
She would be paying far more living on her own, and it’s only fair to help out with the expenses. Having her help out with expenses is a great way to stave off future resentment on either of your parts. She pays and therefore has a stake and a say in how and where things go in the household, meaning house rules become a joint agreement instead of one party simply living under the other’s rules which can cause more resentment... It also gives her a sense of ownership and responsibility to the home, which I think is very positive for a relationship.
Not if you want to keep her as your GF. :) just from a women's perspective.
She should be paying 50% of what the unit would rent for at market rate, plus 50% of the utilities. I (we) did the exact thing when my gf moved in with me. Why would I simply let her live with me for free and then just use her money for fun?
@Daniel Lynch , My girlfriend is moving in; I am charging her rent. With that said, I also made it clear that she is more than welcome to buy equity and enjoy the benefits of ownership.
- Your emotional relationship is different than your financial relationship; this is just business.
- In my case, her moving in is cheaper than if she rented/bought her own place independently.
- If you both moved into a new place (rented or bought), you would likely split all the costs.
@Constancia R. , Good point, sometimes it’s not what you are saying , it’s how you say it.
I actually had a friend that had an issue like this. They didn't have the stress of a mortgage but, even just the general idea of living and renting together can be similar enough. From viewing this I think the best way to approach this is to have a hard conversation with her to start to let her know that this isn't a free ride and you are not a bank. You are in a partnership to share responsibility of things together. If she refused to pay anything and required you to pay for everything, is that really a relationship you want to be in?
She should pay rent- just an investor's perspective. ;)
In all seriousness, it might sound a little "cold" to ask her to pay rent straight up, but I don't really think anyone (man or woman) should have a free ride. I think you should frame it in a way that explains the ongoing cost of property ownership (including whatever % you will be setting aside each year for capex), and that, without her, you would be collecting rent from a roommate to help cover those expenses. Come up with whatever her share of the expenses would be. If you really want to feel ok about it, you can compare that number with what you would have charged a roommate. The difference between those two numbers would be the "profit" you are leaving on the table (assuming you could get more from a roommate). My logic here may be a little convoluted considering the property is a duplex and you're house hacking but this is what I would do in your shoes.
(It's worth noting that you'll need to have her sign some kind of rental agreement for legal purposes.)
You could present it to her that you are a team building (saving) towards the next investment and if the bank sees a lease for half of the duplex it will make it easier to qualify for the next purchase. Tell her this is part of her contribution to you guys future!
@Daniel Lynch you’re putting down the money and taking the risk on the investment. I wouldn’t charge her rent, but I would expect someone living rent free to be willing to pick up whatever small difference is left on the mortgage after renting out the other side and any utilities bills. If she’s unwilling, I’d think hard about whether that’s someone you wanna be with long term and go from there
@Daniel Lynch - Why wouldn't she have to pay if she isn't willing to contribute to any of the down payment or renovations? If you guys were staying in a normal apartment that you rented wouldn't you split the bill? This is the same concept. At a minimum, she should be paying for the utilities and groceries like others have suggested.
No matter your decision it probably won't be the right one haha best of luck!
I am always trying to talk my girl into doing things I wouldn't do for any amount of money. No way I would even broach that subject with her. As long as you can afford to, just pay it yourself. That's my advice..
@Aaron K. Agreed. If she is a wife material she knows you guys share bills 50/50.
If she is not wife material she may get mad. This is my objective opinion. If she gets offended going 50/50 I would run and align with a woman who has your goals and Vision In mind, and aligns with yours.
@Daniel Lynch Do you like this girlfriend?
If Yes, do not charge rent, in fact a monthly living stipend for necessities would be encouraged, if not insisted upon.
If no, definitely charge rent, with monthly rent increases of $50.00.
Hope this helps!
@Daniel Lynch I recently just moved out of my duplex (house hack) with my gf and I only made her pay me the difference in rent.
For example my PITI was $1350 the first year and I had $1300 coming in... That year she lived for free. Last year my taxes went up and my PITI was $1500. I made her split the 200 with me plus utilities of course.
Ironically, we just moved into her 3 fam she bought (house hacking again) and she is only charging me the the difference. Luckily I should only owe $25 bucks a month....
My 2 cents is.... just split whatever the difference is in rent, that way it's fair and it will still be cheaper for her than paying traditional rent.
Split expenses and frame it that way to her. If she makes a lot less then you the split could be higher on your end. If you have a woman who still expects to be taken care of, as a GF, well she needs to grow up, it is 2019. Equal rights, equal responsibility. We split it as BF/GF and that was quite number of years ago.
@Daniel Lynch I would definitely make her pay rent, but it’s all about framing the conversation. Start off with how much she is paying for rent today (I’m assuming you don’t live together already). If she didn’t move in with you, that is how much she would be paying so that is her baseline. If you two are splitting one side of a duplex, her half of the rent should be substantially less than her living alone which is a win for both of you. It’s all about perspective, but you should be charging her, in my opinion. Congrats on the investment and good luck with the conversation.
My favorite topic!
Split P&I on the mortgage and utilities, and you should pay tax/insurance. This makes it as if you were renting a place together and equitable. You pay more cause you have the upside, she pays essential fair market for her half of 'rent.'
It is my opinion that two people living together should share responsibilities towards the cost of living. That could be help paying for heat, groceries, electricity, cable, etc.
Story - My first 'house hack' was a four-unit (I was 100% owner). My ex-girlfriend moved in a few months after closing and renovations had taken place. I was 100% honest with the fact I owned the property and the other rents were covering all the expenses for the property (PiTi, heat, water, sewer, etc.). After we discussed this, she offered to pay for groceries and electricity; which we both felt was fair. All worked out great...well as fair as the financials haha.
Best luck to you!
Bought my first househack in January and currently my girlfriend and I are splitting the expenses. We signed a lease, because she was concerned if we broke up she would have time to find another place. Tough situation through we just talked it through.
Yes, complete a lease agreement with both of y'alls information included. Just like if you were going to rent out a property to two new tenants.
IMO if she would be willing to split the bills in a property y'all rent from someone else. There should be no issue with splitting the bills on a property you own.
If an issue is raised with splitting the bills on the property you own. I would consider that a red flag and cause for concern in the future.
This opinion is based on the fact that I would personally pay full price for my significant others products or services offered in a given venture.