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The Best and Worst Metros to Have Roommates

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Sharing space with a roommate offers a litany of perks if you want to live in a thriving city, but also need to reap economic benefits. It can drive down your cost of living and make recurring bills like monthly car payments easier to manage.

Most people would rather avoid the potential conflicts and loss of privacy that can go along with sharing intimate living spaces with other people. But is it financially feasible? We wanted to see whether or not residents in certain large metro areas should take a closer look at roommate living — or if they could get by without one.

Taking a look at the 50 largest metro areas, we examined the percentage of housing units with two or more bedrooms and the percentage of adults who have roommates. We also looked at the economic impact of sharing a home, such as the percentage of median earnings saved by roommates living in a roommate in a two-bedroom apartment.

Here’s what we found.

Key takeaways

  • San Jose, Calif. (better known as the heart of Silicon Valley) earns the no. 1 spot on our list of best places to live with roommates with a final score of 73.4, on a scale of 0 to 100. Rents are high enough to offset the metro’s higher than average incomes and living with roommates is a popular choice. San Jose also ranked fifth in our list of the biggest millennial boomtowns.
  • Orlando, Fla. comes in second with a final score of 63.6, thanks mostly to low incomes relative to rental prices and a dearth of one-bedroom and studio apartments. The combination of those factors drives renters to seek out home-sharing situations.
  • Washington, D.C. comes in third with a final score of 62.7. Interestingly, the economics of home sharing in The District were better than in Orlando, despite its lower ranking. The monthly cost difference between a single renter in a studio or a one-bedroom unit and two people paying for a two-bedroom unit was $748 in Washington, D.C., compared with $470 in Orlando, according to the findings. That means roommates in D.C. saved 2.4% of their median earnings for each additional occupied bedroom, more than the 1.9% savings that Orlando residents achieved, the study reveals.
  • San Francisco makes the list of better roommate markets, with a score of 56.2. Don’t let its 11th-place finish fool you, however. The returns of roommate living are competitive with top-finisher San Jose. San Francisco roommate renters can save 3.2% of median earnings for every additional occupied bedroom, just behind San Jose. But roommates there save $136 a month for each additional occupied bedroom, the second highest in the study, after San Jose.

To get a more detailed breakdown of how the cities that placed in the top 10 of the rankings compare with each other, review the following chart. The skinny of our findings? Coastal cities, such as Los Angeles, Orlando, Portland and San Diego found themselves at the top of the charts. Perhaps coincidentally, Washington, D.C., and Seattle also topped out list of the best cities for working women.

For every strong roommate market, there appears to be a counterpart that does not have as much to offer to its renters. Most of the metros that landed in the bottom 10 ranks of the study were located in the Midwest and Southwest. They trail the 10 best markets in terms of economic returns for roommate living, and had much lower percentages of adults sharing homes.

Understanding the results of this study

To help us determine where roommate living makes the most sense, we analyzed several important metrics for the 50 largest metros in the US:

  • The percentage of adults who live with roommates. More people having roommates means that residents think there’s an advantage to it. It also suggests that the market does not present major hurdles to finding future roommates, as life shifts.
  • The percentage of housing units that have at least 2 bedrooms. In some metros, people looking for one-bedroom or studio apartments may have a hard time finding them. Think of Houston, with such a high percentage of housing units that have more than two bedrooms! This housing setup often means that renters face having to pay more for space than they need. The flip side is that more homes with two or more bedrooms make it easier to find shareable living space.
  • The percentage of median earnings that locals can save by evenly splitting the costs of a 2-bedroom instead of renting a 1-bedroom or studio. This is an important metric in the study, because sharing the burden of housing costs is a major motivation for some renters to look for roommates. Rents vary across metros, but so do median earnings; $1,000 rent in one market could be easier to manage in some places than $800 rent is in others. To account for that, we compared the dollar savings of splitting median two-bedroom rent to median earnings.
  • The percentage of median earnings that locals can save by renting more bedrooms to bring in more roommates. This is similar to the metric above, but for this we calculated the average differences between three, four,and five bedroom apartments split between three, four and five roommates. Then we compared that with the cost of a two-bedroom apartment split by two roommates.

3 financial perks in having roommates

Some cities are affordable while others are shockingly expensive. No matter where renters decide to share housing with another, however, the economic benefits are clear:

  • Roommates help keep initial living costs down. If you are working toward specific financial goals, such as to finally pay off your debts, starting off with a lower cost of living can free up cash to put to work on your financial ambitions.
  • Paying for other essential expenses in the budget just got easier. Add car expenses, health insurance and other items to a spending plan, and the prospect of having more money to tackle those expenses make living with a roommate more attractive.
  • Renters can save more of their take-home salaries. Lower housing costs can help renters position themselves to build an emergency savings cushion with free cash. That means if an emergency costing $1,000 or so crops up, renters will not have to incur debt to pay for it.

Quick tips for ditching your roommates

Renters who just want a space of their own can also use a couple tactics to leave their roommates behind.

  • Make more money and take over those rent payments. Job changes might boost a renter’s salary, giving him or her enough incentive — and the means — to go solo on the apartment.
  • Downsize to an even smaller unit. If renting a smaller unit alone is affordable compared with the current unit, a renter could take the opportunity to leave the roommates behind. You may also want to consider our study on the best places to live when you’re young and broke. Moving, after all, may be the best option for your finances.

Methodology

Using American Community Survey data available from FactFinder (2017 5-year estimates) and microdata hosted on IPUMS (2017), researchers calculated the following, aggregated to the 50 largest metropolitan statistical areas (“MSAs”):

  1. Percentage of adults 18 and over who live in a household with roommates.
  2. Percentage of local housing units that have at least two bedrooms.
  3. The difference in median rent between one person who rents a unit with fewer than two bedrooms (rent for studios and one-bedrooms were averaged) and between two people who rent a unit with two bedrooms. (Not scored).
  4. The percentage of median earnings that would be saved by sharing a two bedroom with a roommate ([C] / Median earnings for MSA)
  5. The difference in rent between [C] and the average of median rents of: three bedrooms with three-paying roommates, 4 bedrooms with four-paying roommates, and five or more bedrooms with five-paying roommates. (Not scored)
  6. The average percentage of median earnings that would be saved by adding roommates with their own bedrooms ([E] / Median earnings for MSA)

These metrics (except for C and E) were then scored for each MSA based on their positions between the maximum and minimum values, with a highest score of 100 and a lowest score of zero. The four were then averaged (equal weight) for a final score for each MSA. The highest possible final score was 100 and the lowest was zero.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Donna Mitchell
Donna Mitchell |

Donna Mitchell is a writer at MagnifyMoney. You can email Donna here

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Strategies to Save

The Best Places for Raising a Family as a Single Parent

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Being a single parent is a challenge. Not only must single parents manage debt and other financial priorities, they must balance work and time spent with their children. Unfortunately, single-parent households are more likely to be impoverished, and not all states offer the same workplace benefits for parents. That could make raising children harder.

To determine where single parents may fare best, we scored the 100 largest metros on four key indicators:

  • Income score, including median income; the percentage of households living below the poverty line; and the percentage difference between median single-parent households and all households.
  • Affordability score, which considers regional price parity; income limits for in-state child care assistance; the percentage difference between single-parent household median income; and income limits for child care assistance.
  • Time score, which includes the average commute and the average number of hours worked per week.
  • Workplace protection score, which considers statewide paid family leave insurance and protected time off for school events.

Here’s what we found.

Key findings

  • Single parents in Springfield, Mass. came first in our rankings, with a score of 65.2. The city had an especially high time score and workplace protection score.
  • Sacramento, Calif. and Buffalo, N.Y. followed Springfield, with final scores of 62.2 and 61.5, respectively.
  • In McAllen, Texas, a whooping 60.8% of single parents live below the federal poverty line. Honolulu had the lowest incidence of single parents living below the poverty line, at 24.9%.
  • Houston, Texas had the lowest score among the 100 metros we studied. Its final score was 26.7. Notably, the difference between the median income of single parents and all households was -51.4%.
  • Atlanta and Birmingham, Ala., which were No. 99 and No. 98 in our rankings, didn’t fare much better, with final scores of 27.7 and 28.1, respectively.
  • So-called “blue states” tended to dominate the top of the list, thanks mostly to strong workplace protection laws for parents and generous childcare subsidies.
  • On average and across all metros, 39.2% single parents are living below the federal poverty line.

Children aren’t cheap, and raising them is hard. This map highlights locations where being a single parent may be easier or more affordable. Hover your cursor over the dots on the map to review how each metro fared across our key indicators and overall.

10 best places to live as a single parent

This table outlines the 10 best places for single parents to live from a financial perspective. California and New York parents are in luck. Three of the top 10 locations were California-based and four were New York-based. The combination of their high income, affordability, time and workplace protection scores helped determine these locations rankings.

10 worst places to live as a single parent

These locations had the lowest rankings due to their scores in our four key indicators. Single parenthood appears to be more challenging financially in Southern states, with locations in Texas, Georgia, Alabama and South Carolina ranking in the 10 worst places to live as a single parent. Most notable are these 10 locations’ nonexistent (or very low, in the case of Chicago with a score of 10/100) workplace protection scores.

Understanding these rankings

In order to understand how we ranked these locations, it’s important to look at the four following categories that we scored. The average of the scores was individually calculated for each metric within each category and was used to determine the overall metro scores. Those sub-scores were calculated on a scale of 0 to 100, based on where each metro falls between the highest and lowest values among all the metros we reviewed.

The four key indicators that were scored and the metrics within each indicator are:

Income of single parents in the community

  • Median income of single parents.
  • The difference between the median earnings of single-parent households and the median income of all households. This gives us a sense of whether single parents are having a harder time earning money than other members of the community.
  • The percentage of single-parent households that fall below the federal poverty line.

Comparing the difference between incomes of single-parent household and all households gives us a sense of whether single parents have a harder time earning money than other members of the community.

Affordability of the community, particularly related to child care

  • The income limit for child care subsidy assistance from the state.
  • The difference between median earnings for single-parent households and the child care assistance income limit.
  • Regional price parity, which compares local costs – including housing, goods and services – to the nation as a whole. The regional price parity for the U.S. is set at 100, so a number lower than that means that costs are lower and a number above that means costs are higher.

Child care expenses are an absolute necessity for single working parents. So, we wanted to see whether or not a typical single-family household would qualify for assistance from its state, and how much below the qualifying line they fall. This is significant because many assistance programs offer graduated subsidies depending on family income.

However, some states have long waiting lists for assisted child care, so falling within the qualification limit for subsidies doesn’t necessarily mean that parents will actually get the child care they need to earn a living for their families.

Time devoted to work

  • Average commute time in minutes for the metro.
  • Average hours worked each week within the metro.

How much time a single parent spends working impacts their time spent with family and can increase the amount spent on child care costs, such as if the parent needs to put their child in day care while they are away at work or commuting.

Workplace protections for parents

  • The number of weeks under the Family and Medical Leave Act that a state will pay an employee from a state insurance program. Under federal law, workers of certain tenure can’t be reprised for taking up to 12 weeks of leave to care for themselves or close family members per year, however that time is unpaid, barring workplace policy or short-term disability insurance. A handful of states have created insurance programs, similar to unemployment insurance, to pay employees a portion of their usual earnings while they are on approved leave.
  • Protected time off for school events. Because participation in children’s schooling is so important, some states have passed laws to guarantee that parents can take a certain number of hours away from work to attend events and meetings related to their children’s schooling.

Parents in general, but especially single parents, can benefit from regulations that protect them when they take time off work due to family-related issues.

Full rankings: 100 best places for single parents

The following table breaks down the overall score for the 100 best locations as well as presents their subscores for each factor taken into consideration. Each column is sortable in either ascending or descending order. By sorting the chart, you’ll see how the different factors contribute to their scores.

Managing your finances as a single parent

Based off our findings and further research, there are a few ways single parents can better manage their finance on one income and with children.

Consider your debt relief options: If you’ve found yourself in debt and are struggling in repayment, you could review your debt relief options. Chapter 7 or 11 bankruptcy, debt settlement and debt management plans may be available to you. Learning how these options affect your credit score is something you should also research.

Review your personal loans options: Those with credit card debt or high-interest loans may want to consider refinancing or consolidating their debt into a personal loan with a lower interest rate. Doing so could reduce your overall costs for repayment. You could also extend your repayment term to reduce monthly payments, though this could increase how much total interest you pay on your loan.

Learn about government resources for parents: Single parents who are struggling financially may qualify for assistance through government or charitable programs, such as food banks. A 2017 study found that not all single parents were aware of the help that is provided at food banks or were not certain they were entitled to support.

Know your rights: Paid time off for sick children and protections against reprisal for going to parent-teacher conferences can make a big difference, although these policies may not be well enforced. Learn your rights regarding the Family and Medical Leave Act and any protected time off for school events you may be eligible for. Knowing what your rights are will help you protect yourself against employer repercussion.

Methodology

Limiting our research to the current 100 largest metropolitan statistical areas (“MSAs”), we tracked each metro across four categories. The data was derived from the 2017 American Community Survey 5-Year Estimate from the U.S. Census (“2017 ACS”), except where otherwise noted.

Each data series was scored relative to highest and lowest values across all metros. For each category, these scores were averaged for a highest possible category score of 100 and a lowest of 0. The four category scores were then averaged for a final score. The highest possible final score was 100 and the lowest was 0.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Jacqueline DeMarco
Jacqueline DeMarco |

Jacqueline DeMarco is a writer at MagnifyMoney. You can email Jacqueline here

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