It’s 6am on a Monday. You feel tired and cranky as you make your way to the kitchen to start your day. How much would you pay to avoid eye contact or awkward conversation with someone at that moment?
Questions like this have become more relevant as renters face affordability concerns and seek out ways to curtail their expenses. In the last 30 years, Americans have seen wages stagnate, while student loan balances and rent prices rise – leading some renters to get creative in order to save on housing.
One increasingly popular option? Finding someone – or multiple people – to split the rent with, even when it means sharing the kitchen on a Monday morning. In our brand-new Rooms for Rent index, we found that renters pay the highest premium for privacy in the nation’s most expensive markets. San Francisco, Los Angeles, and New York renters can expect to pay about $1,000 more each month for a one-bedroom home than they would to rent out a bedroom in a shared home or apartment. This means that renters in the country’s most unaffordable markets stand to save the most if they are willing to share their space.
Privacy comes at a much smaller price in the South and Midwest. Houston renters stand to benefit the least from renting a room out of metros we analyzed – renters there need only pay $160 more for a one-bedroom home than the typical room for rent.
The relationship between the cost of a one bedroom and the cost of a room for rent is strong. For every 1 percent increase in the median one-bedroom rent, the gap between the cost of a one-bedroom rental and a room for rent widens by 1.7 percent.
This gap is driven by the fact that rooms for rent have a significantly tighter range of prices across the country compared to one-bedroom apartments. The most expensive market for rooms for rent is San Francisco, at $1,430 a month, while the least expensive is Pittsburgh at $680 a month – a $750 difference. Meanwhile, the difference between the most expensive median one-bedroom rent and the least expensive one-bedroom rent is $1,620 — more than twice the range we found in room for rent prices.
As more renters seek individual rooms for rent as opposed entire units, companies have responded to the increased demand. For example, HotPads’ map-based search now shows users whether a unit on the map is for an entire home or a single room and allows users to filter their search to only show rooms for rent.
Methodology: To calculate the median cost for a room to rent, HotPads analyzed the median asking price for room for rent listings on HotPads over the past 12 months. To determine the national median, HotPads weighted its data based on the number of renter households in the different geographies, as calculated by the most recent data from the U.S. Census.