Are Gen Z and Millennials Destined To Live With Roommates Forever?

Wide shot of millennial couple lounging in their living room, planning out their finances and looking at their account via online banking.
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National rents reached a new high in the first half of 2022 with a national average of $2,495 a month — a 13.4% increase compared to the same period in 2021. While there is an anticipated cooling period to come from the recent accelerated pace in housing costs, the budget for many renters is currently stretched beyond its affordability limit

Being on a tight budget often means buckling down on overhead expenses, including those surrounding cost of living. Many individuals, including millennials and Gen Zers, are living with roommates to save on rent and utility bills. Living with roommates is often depicted in a less than favorable light — usually a false snap judgment such as being in dire financial straits or lacking the initiative to take the next step forward in living alone — but there are many benefits that come with having roommates. 

Benefits of Roommates

Here are some of the lesser-shared benefits to having a roommate and what you should know about reviewing a potential roommate.

Lower Risk Than a Mortgage

There are certainly financial savings that come with having a roommate including the ability to split rent and the cost of utilities like heating, water and internet. But, the greatest saving might be choosing to sign a lease instead of a mortgage.

Tim Lumnah, a realtor at Berkshire Hathaway HomeServices Page Realty, said that while few like the idea of paying rent as opposed to owning a home, a mortgage is a huge commitment. This is especially true if the borrower has other significant debts, like student loans, they are trying to pay off. 

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“Signing a 12-month lease is much lower risk to a person’s finances than a mortgage is. Even when rent is high and comparable to a mortgage, such as $1,200 per month, renters need to consider that homes also have other ownership costs that apartments don’t have, like taxes, private mortgage insurance (PMI), higher utility bills, repairs and other carrying costs,” Lumnah said.

Lend a Hand When In Need

Aside from affordability, Lumnah said another advantage of living with a roommate is social benefits. Roommates can introduce each other to other friends, hobbies and even employers. In some circumstances, roommates can also lend a hand in need.

Eva Keller is the owner of Discovering Hidden Gems and a millennial. Keller, who moved to Southern California in 2017, had to get roommates for her two-bedroom apartment. Keller, who is married, said that now it’s just herself, her husband and another roommate who has been living there since 2019.

For the past two years, Keller and her husband have been going on road trips across the United States. While Keller said she and her husband can now afford the apartment themselves, the rent would dip into their discretionary income. It would also make it difficult to spend as much time on the road, as Keller said the trade-off would ultimately be that they would have their own place but not the freedom to go do whatever they wanted whenever they felt like it.

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Keller, who spent over 165 days on the road last year, said there are many bonuses to having a roommate while you’re away. Some of the ways roommates can lend a hand include the ability to check mail and intercept package delivery regularly, alert other roommates in the event of an unprecedented situation like a flooding in the home and dropping off the rent check on time if other roommates are out.

Live In a Neighborhood You Might Not Be Able To Afford

Another silver lining to having roommates? You might get the chance to live in your dream neighborhood.

“Living with roommates allows you to actually live in a neighborhood you might not normally be able to afford if you just rented a one-bedroom or studio, which is usually higher per bedroom,” said Ruth Shin, founder and CEO of PropertyNest

Autonomy From Family

Many consider living alone to be the end game life milestone that allows individuals to move out from their family home and become fully independent. In this current period of inflation, however, roommates may act as a helpful stepping stone to reach this goal. Living with roommates allows individuals, especially young people, to transition from their family home to eventually living on their own.

“It’s definitely one of the best ways a young person can gain autonomy and independence from their parents’ financial support and oversight,” Shin said.

Reviewing a Potential Roommate: What Should You Know?

Thinking about getting a roommate? Amy Mueller, VP of communications at ApartmentAdvisor, recommends new renters review the following questions with a potential roommate.

  • Do you keep your common living space neat and tidy, or are you fine with a little clutter and mess?
  • Do you have a job with a reliable salary? What are your work hours, and will you WFH?
  • Do you have/want to have a pet?
  • Do you have a significant other and do you expect they will be able to spend the night?
  • Do you like to host social gatherings? How often will you want to do that?
  • Are you a smoker?
  • Do you have food allergies or any other specific health needs/restrictions?
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Creating a Roommate Agreement

Additionally, renters who wish to live with a roommate may consider creating a roommate agreement. Mueller said this agreement should include room assignments, division of responsibilities, cleaning duties, tolerance for live-in or visiting pets, smoking and vaping policy, quiet hours and how you’ll handle overnight guests.

While a roommate agreement isn’t binding, Mueller said it acts as a helpful reference for when, and if, issues come up.

“For adults, I always suggest a roommate agreement because it will help protect the tenants in case a dispute ever occurs,” Lumnah said. “Short of buying themselves out of their leases, a solid roommate agreement, and keeping good records of everything, is the best protection against anything that could go wrong.”

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