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One of biggest factors affecting our day-to-day lives is where we live. There can be many possible hopes and joys surrounding it. For most of us, those hopes and joys are constrained by what we can afford to spend on rent.

How Much Should I Spend on Rent?

The traditional way to budget for rent has been as percentage of income – typically 30 percent of gross income. For example, if your monthly gross income is $5,000, then rent should be $1,500 per month. However, you’ll be better served by taking these considerations into account as well:

Retirement savings. First, keep in mind that rental expense is a true expense that takes funds away from your savings. The younger you are, the more time you have for savings to compound for retirement. For example, $1,000 saved at age 25 would grow to over $7,000 by age 65, assuming a return of 5 percent annually. So an important way to look at rental expense is the tradeoff between your current lifestyle and retirement lifestyle. Take care not to compromise your future lifestyle for the sake of your current lifestyle.

Savings fluctuations over time. For most Americans, savings are highest before and after children. For example, a young, childless, dual-income couple will have relatively low expenses relative to income. Similarly, an older couple whose children are out of college will also have relatively low expenses. Having and raising children is costly, and the ability to save is the lowest during that middle period of life if you have children. That fact, combined with the power of compounding, means that saving money for retirement is the most important early in life, especially before having children. So even if you have a good amount of income, it is important to manage expenses such as rent carefully when you’re young.

Down payment on a home. Economizing on rent when you’re young can also allow you to save for a down payment to buy a home. In general, owning is cheaper than renting if you stay in the same place for six years or more. Also, owning a house and paying off the mortgage will hopefully result in a debt-free asset in retirement, with low monthly overhead when income is also low. Therefore, it makes sense to save on rent when you’re young and put the savings toward a combination of retirement and a down payment on a house.

Discretionary spending. Another useful way to look at rent is as simply another discretionary expense that can be traded off versus other discretionary expenses. For example, you can save on rent to spend more on entertainment and dining out. Or you can do it the other way around: Limit meals out and entertainment in order to afford a nicer place to live. Either way, there is a tradeoff to be conscious of and make according to your priorities.

Saving on rent with a roommate. Consider a roommate to save on rent and be able to afford a nice place in a good location. This can help in so many ways. For example, you will be able to split not just rent, but also the cost of electricity, internet service and other utilities. With the right roommate, you will also enjoy the added benefit of having a friend that you enjoy spending time with. Obviously, the wrong roommate can make life very unpleasant. Still, you can very likely save 50% on rent with the simple decision to have a roommate. But choose that roommate carefully.

Paying more when it gets you a better job, location and lifestyle. There are instances when it really makes sense to pay higher rent. For example, it can makes a significant difference in your quality of life, such as by reducing your commuting time or allowing you to live closer to loved ones or your workplace.

The real estate adage “location, location, location” holds a lot of truth. Location makes a lot of difference in the overhead involved in the daily orbit of our lives – to work, school, stores and friends and family. Therefore, it is worth paying up for the right place at the right location, if that results in significantly improved quality of life.

Consider not using the 30% of gross income as a rule of thumb, but as an absolute maximum. The less you spend on rent, the more you can save for retirement and a possible house purchase. Also, you will have more left over for entertainment and other discretionary expenses. In addition, the right roommate can help you save and simultaneously add to the quality of your life. With all that said, consider paying more in rent if it gets you significantly better quality of life.

The traditional open house format is still popular, but whether it’s effective in helping sell your home may depend on the type of property.
When launching a new property onto the market, an open house is usually standard procedure.

An open house invites people to tour a home that is for sale. A listing real estate agent often schedules two different types of open houses: a “broker only” open house to other agents, during the day on a weekday, and an open house that’s open to the public, typically on a Sunday. Usually, an open house lasts about 1.5 hours with the goal of attracting a buyer who is out and about looking at other homes for sale in the area.

But in the era of the internet where listing a home for sale online presents extensive photos, floor plans and videos, is this traditional format still effective? And if so, for what types of properties does it work best?

Here are some key questions to consider when thinking about whether an open house is the best strategy for your home:

• Does an open house logistically work for you?
• How does asking price factor into an open house?
• How often should you hold an open house?
• How can you keep your home safe and clean during an open house?
• Do you need bells and whistles for an open house?
• How can you prepare for an open house?

Does an Open House Logistically Work for You?
How flexible are you and what does it take to vacate your home? Young children or pets at home are considerations when scheduling showings and open houses, especially those on a Sunday when kids are not in school.

Perhaps regular open houses work best when you’re hoping to allow many people to see your home on your terms during a scheduled block of time. It might be easier to clean the house and make it look perfect for a scheduled showing as opposed to multiple impromptu appointments. The hope is, with an open house, the home will be seen by many potential buyers in one shot.

This begs the question of quantity versus quality – are those who drop by really homebuyers ready to make an offer? Keep in mind, a serious buyer will most likely want to return for a private showing to review the property at length and more thoroughly.

How Does Asking Price Factor Into an Open House?
Homes at entry-level prices for the local market usually attract first-time buyers. Many of these buyers are at work during the weekday and spend their time looking for homes on Sunday afternoons after a slow morning or meeting friends for brunch. Weekend open houses are convenient for this type of buyer, especially as she is figuring out what she wants and needs in a home, though a visit during an open house won’t necessarily lead to an immediate offer.

On the flip side, many high-end, luxury properties attract a more private client who prefers to view properties discreetly on his or her own terms. A public open house may attract those just looking for sport or curiosity, whether they’re your nosy neighbors or people who aren’t really interested in buying. For both reasons, homes at the high end of the price range are less likely to host public open houses.

How Often Should You Hold an Open House?
How many open houses are a good idea? Most ready buyers who have been waiting and watching the inventory flow usually appear, if interested, within the first two weeks of a property being listed for sale. After that, regular open houses may attract a general flow of weekend lookie-loos, as many buyers wander from open house to open house for fun. They may just be curious, but an open house format provides a no-pressure platform to look.

After those first couple weeks on market you can typically stop holding open houses, as the buyers who are interested in the property and that have a more deliberate plan to assess the house will likely make an appointment to tour the place.

How Can You Keep Your Home Safe and Clean During an Open House?
Agents do their best to monitor visitors, but all personal belongings should be put away. It may seem obvious, but jewelry should be secured – preferably in a safe. Items such as mail and newspapers with the owner’s identity on an address label should be hidden for privacy. Remember that people do like to snoop, so you can expect cabinets and closets to be opened.

To keep the house clean, many sellers prefer that visitors remove shoes or wear shoe covers to protect carpets. Discuss your preferences in advance with your agent.

Do You Need Bells and Whistles for an Open House?
Some real estate agents advertise coffee and donuts at open houses to entice traffic. Realize that strangers will be eating and drinking in your home. While it may encourage people to stick around longer, the chances food and drink will help sell your home are slim.

How Can You Prepare for an Open House?
The open house is showtime for your property and you can only make one first impression. Make sure the home looks fantastic. If there is a leak in the roof or the heat stops working, it’s better to cancel the open house than make excuses for something that is fixable and minor, but creates worry and doubt.

The goal of an open house is to make your home available to a potential buyer at a time that works for you, and when buyers are traditionally out shopping. If you’re still unsure an open house will be beneficial to you, ask yourself the following questions:

1. Will the buyer for my type of property want to come to an open house format?
2. Do I, the seller, want to have strangers wandering through my home?
3. Do I really need to do this to sell my home?

The realistic answer to most, if not all, of these questions is, “No, probably not.” You may still opt for an open house and consider it a useful marketing tool, but it’s unlikely you’ll get an offer directly from an open house.