Pity the government official coping with budget crises and all the demands on shrinking resources.  Their decisions can have ripple effects with unintended consequences.  For instance, a decision to reduce benefits when individuals are sharing housing.  Of course, from one perspective the beneficiary may not need as much money as when they weren’t sharing housing.  However, why set things up so that people are discouraged from pooling resources to improve their housing situation?

Here’s the relevant quote from an article in the DailyCal.org :

Speakers at the meeting asked the supervisors to eliminate medical and shared housing deductions from general assistance. As of last September, recipients may have $40 deducted from their assistance for not having health insurance and 10 to 25 percent of their assistance deducted for sharing housing.

“This rule does not make sense,” said Gina Gemello, a law student working at the law center. “It tells GA recipients not to be resourceful, not to pool their resources, not to reduce overhead housing costs.”

We couldn’t agree more.

Has your house become too expensive for you? If so, you are hardly alone. According to RealtyTrak, in 2010 between 3 million and 3.5 million foreclosure warnings will be issued. This is up from 2009’s record of 2.8 million. (USA Today, Feb. 11 2010) That’s a lot of houses, that’s a lot of unhappy people.

If your house has become too expensive, one thing you can do is share your house and earn income.

Rent a room. Rent two rooms. Would the income from that rent manage the gap between what you have and what you owe?  What could you charge? Do some research about rents in your area. Look at rooms for rent like yours in your neighborhood.  Look at what apartments cost. Find a good price that is within the range for your neighborhood. Think also about the cost of utilities.

Don’t get greedy. Find a price that makes it a good deal for your future housemate – a person you will be living with. The room or rooms you rent could be life-savers for other people, those for whom renting an apartment is too expensive.

We need to start doubling up. We can share housing and help each other out. There are lots of people doing it. There are others who need encouragement.

Don’t you think it’s a good idea?

The general rule of thumb for a reasonable amount to spend on housing is now 30% of gross income. It used to be 27%. The three percent increase probably represents a creep upward as everyone copes with higher housing costs.  So what is 30% actually? Here’s a quick look.

Income $25,000, housing  $625 a month.

Income $35,000, housing  $855 a month.

Income  $45,000, housing  $1125 a month.

Income  $55,000, housing $1375 a month.

Income  $65,000, housing  $1625 a month.

Income $75,000, housing  $1875 a month.

Of course there are other factors that go into the cost of living.  Transportation is a huge one. There is a very nifty interactive site that shows how the costs of housing and transportation together change the affordability of an area. Living in a cheaper area but spending more time driving may not be  cost effective. If your housing plus transportation costs are more than 45% of your income, your costs are unsustainable.  The site offers analysis of most major US metropolitan areas.

Can you afford living alone? Maybe.. how much more cash would you have if you shared your housing? What could you do with that extra cash?