I’m a little confused why people would think that the price of a house is an abstraction. This is why I know how to tell a house to be imputed. The real question is the cost. Cost? It is always a question that must answer itself.
That being said, it is not a matter of cost per square foot. A home with the highest square footage will cost more in its first year than a home with a smaller footprint (less square footage) would. But if you have a large, family, or perhaps a large number of friends, it may be worth it to increase the footprint. Not only does it allow more rooms to be used, it also makes it seem more expensive and more special.
It’s a question of square footage, but the amount of space you can actually put into a home is a matter of the amount of square footage of any given area. If you have four bedrooms, that means you can have six rooms in total. If you have five, that means fifteen. If you have six, that means thirty. It also depends on the room size.
I often get asked how much a roommate is worth, because it turns out that there are a lot of variables that determine how much a person would be worth. A lot of times it’s all about the amount of money you’re willing to spend on the person you’re paying for, so just by the amount of money you’re willing to spend, you can figure out how much a person is actually worth.
What we mean by “imputed” is that when we pay a person to live in our home, we get to dictate how much they contribute. This is because we’re not paying them rent, but rather a percentage of the total cost of having (or not) the space, which in turn is a percentage of the cost of having (or not) the number of other rooms we have.
So if youre making a decision about your new home, your rent-to-self ratio is basically the amount of money youre willing to spend on the person youre paying for. Then you use the ratio to figure out how much your tenant actually contributes. This is so they can make up the shortfall between their rent and the cost of owning their space. The more they contribute, the less there is for you to pay.
The problem here is that because rent is a percentage, it is always going to be based on the cost of the space you rent. If you build a basement that cost $20k, then youre going to have a rent of $20k per month. However, if youre going to build a room for $1k, its only going to have a rent of $1k per month.
In the case of a basement, its always going to be a percentage of the space that’s actually available because you cant just build a room for a single tenant. If your apartment building is located in a town with a lot of single-family houses, then youll have to build a basement if you have a room for that many people. In reality, there are no “permanent basement” spaces. Your basement is always going to be a percentage of your existing space.
If you move into a new apartment and you only have 1/3 the space, you have to build a basement. If you live in a town with a lot of single-family houses, you can actually build a basement. But even then, its going to cost a percentage of your space.
