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Rental gone sour

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Pet tarantulas, freeloading friends, amateur band practice in the living room; many of us have experienced living with a housemate from hell. Nevertheless a rental squeeze is pushing more Australians towards sharing leased accommodation to better afford a home in a convenient location, with more appeal and better amenities.

While this might sound sensible sharing accommodation throws up countless questions about co-habitation; how should you split the rent? When should a guest help pay the pills? And at what point is a girlfriend a roommate?

To avoid conflict, housemates should set up some house rules right from the start including a financial plan to simplify expenses.

Ideally, you will draw up a written agreement you will all sign. Room share website, Easy Roommate, has a boarder and house-share agreement to download for $14.95. The agreements specify terms of the lease, bond protection and house rules to help resolve any disputes should they arise.

Flatmate finances

An agreement will also help housemates to decide how utility bills will be divvied up; how to split the cost of shared household items; and a strategy to cover costs should one or more tenants decide to move out.

Without a written agreement, expenses can become confusing particularly if each roommate is forking out for a different utility or amount of rent. Sharing a bank account or credit card might be suitable if you're moving in with a partner, but what's the best way to divvy up finances with a friend or someone you've just met?

Housemates will need to decide if all tenants will sign individual leases with the landlord, opt for a co-tenancy agreement or have one as head tenant with others as boarders or subtenants. With one head tenant, a nominated person will be legally responsible for maintaining the property and paying the rent. Other housemates can pay the head tenant by direct debit from their transaction account each week to avoid dispute over money.

And then there's the added challenge of splitting rent fairly, based on room size, closets, bathrooms and car spaces, to name a few. A number of rent calculators exist online to help simplify the process, including one at www.splitwise.com, which tracks spending and habits, provides a shared record of expenses and bills and even sends email reminders to pay up!

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