Friday, November 1, 2013

Move for cheaper rent or stay where you are?

Today my real estate emailed asking if I intend to stay at the end of my lease and if so for how long. This prompted me to have a look at current rentals. When I moved in June there was a shortage, now there is an oversupply and rent prices are reflecting this.

I currently rent a 4 bedroom ensuite home. This is surplus to my needs but is all that was available to rent in the suburb I wanted. I'll be honest, each room gets used. There is my room, my daughters have a room each and have most of their lives then the fourth room is my office. I don't use it all the time, but it is set up as my office.

My lounge, I have a view of the mountains and love being able to work on the deck if I want too.

I could save at least $40 a week in rent if I chose to move to a similar size property or if I downsized to a 3 bedroom I could easily save $100 a week.

My plan is to buy in 12 months, so either way I will be renting, it's simply a matter of do I stay here or do I move.

Scenario 1 - Stay in current house
It won't cost me any extra because I am already living here, set up and paying rent. Nothing changes. However, I can ask for a reduction in rent and I can clear out my office to take in a boarder/uni student.

Scenario 2 - Move to similar size home
Costs of moving to similar size home add up quickly.
Often there is an overlap of rent, say 2 weeks. I need to supply bond for the new place which is not a cost really because I would be getting bond back on this but it is something I have to outlay. $2,670
Connection and reconnection of gas, electricity, internet: I usually get this waived but in case I didn't it would be a few hundred. Say $300.
Petrol to move everything, possible truck hire: Truck and petrol would be about $500, petrol and trailers $100 - $200?
Not to mention the stress, the extra take away food, cleaning products etc. Which can easily add another couple of hundred. Say $200
Total cost: $1,590 (using cars instead of a truck) but total outlay with bond is $3,370

Putting bond aside that is only $10 a week I would end up saving. Not worth it for the stress.

Scenario 3 - Downsize
I would have moving costs as in scenario 3 but rent overlap and bond would be $2,310, or less. Total cost of downsizing is $1,470 with a total outlay of $3,010.

I could potentially still save $72 a week by downsizing.

Other factors to consider
- Depending on where I move, I may need to drive to and from school. Currently we walk on days I am not volunteering at The Blue Door or don't have to be somewhere.
- My kids have moved 3 times in the past year, once interstate. It is really not fair to move them again.
- We have moved so often it almost averages out to be moving every 6 months in the lifespan of my children. They have not known stability. My 6 year old regularly talks about when we move again. Because we will, she knows we will. My aim when we moved here was to stay until I buy and when we buy I am not moving again.
- Postage. I have my Po Box set up but still get some mail delivered to the house. I have already changed my address 3 times in 12 months. I don't really want to go through that again.
- Time. It takes a lot of time to pack everything, clean everything, move it all, unpack and settle in somewhere else.
- Pushing the friendship. Seriously, I have moved the most out of the whole family. I am always helped by family members but I don't want to ask them to move me again knowing I will be moving AGAIN in 12 months.
- 12 months is not that long. It will go by fast and I feel I need to focus my time and energy more on other projects instead of moving again.

Can you tell I have made up my mind? The financial aspect still gets at me, knowing I would save significant money on scenario 3 but the other factors to consider, especially for my daughters outweigh the money.

Scenario 4
This option kind of ties in with scenario 1, since it is about me staying. I could clear out my office and rent it out for $150+. I checked my area and the going rate for some time has been $150 - $220. I have been offered this before but didn't end up following through. I don't really like someone else in my space much. I view it as short term pain for long term gain and if I get someone who works during the day and likes to go out, then I'll be fine.

If I wanted to get technical, my kids have been sleeping in the same room a fair bit the past few weeks. They did when we first moved. I could rent another room if they kept that up.

IF I did get boarder(s) I would not only need a police check but I would like them to have a working with vulnerable people check or be someone I already know. I have 2 kids and don't want random people here, so would be very selective about it.

With scenario 4 not only do I not have the hassle of moving, but I have the biggest potential for savings. Between $150 - $440 a week depending on if I included all bills (which would mean the savings would be less in reality as my bills will increase.)

In all honesty, I like my house. It has a good amount of space, I have a nice view and I am set up here. We have routines, we have our own space and my kids love it too. I'm staying, but will ask for a rent reduction and look into renting at least one room.

What would you do in this situation?

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