Real Cost of Living Alone: The New “Singles Tax”

Living alone in the United States can be a costly endeavor largely due to the fact that rent and utility bills are not typically structured on a per-person basis, meaning that a single person will have to bear the full cost of their rent and bills no matter what the size of the apartment or home is.

This can add up to a significant difference in the cost of living. On the contrary, a couple sharing a living space together can be much more fiscally efficient, as they can split all costs between them.

Despite that, research shows the trend of living alone is on the rise – partially driven by changes in attitudes surrounding gender and marriage and people in this demographic are more likely than previous generations to be divorced, separated, or never married.

For instance, the solo-living Gen X and baby boomer populations are massive – almost 26 million Americans over 50 now live alone. In 2000, it was just 15 million.

For the more than 40 million people who live in this kind of single-income household nationwide, it’s also become increasingly untenable to manage.

Rent is Determined by Size, Not Occupancy

When it comes to renting, most landlords will charge the same rent for a single person as they do for a couple living in the same space – it’s typically calculated based on the number of bedrooms and the square footage of the property.

As a result, the landlord typically won’t charge a lower rent for a single person, who has to bear the full cost of the space themselves.

A new report by online real estate marketplace Zillow found that renters living in a one-bedroom on their own face what they call a yearly “singles tax” of nearly $7,000.

Location, Location, Location…

Since housing costs are a major factor in determining the cost of living, the cost of living in the U.S. greatly varies depending on location and lifestyle.

While singles across the country pay a high price for a solo living arrangement, the size of that ‘tax’ varies widely depending on where they live.

For example, the analysis found the price of living alone in a one-bedroom apartment is the highest in New York City, where data shows that singles pay $19,500 ($24,000 in pricy Manhattan) more a year than someone living with a partner in the same place.

That’s a sizable amount of money that can be used toward paying off student loans, a wedding, or even a down payment on a home.

San Francisco isn’t too far behind with a $14,000 “singles tax” for a one-bedroom apartment.

Of the 50 largest U.S. cities by population, Detroit, and Cleveland have the lowest “singles tax” at $4,483 and $4,387 respectively.

Get a Roommate, Slash Costs

Despite its unpopularity, naturally, singles could avoid this “tax” by just taking in roommates to save on rent and other costs.

Zillow’s analysis also found that cohabitating renters in the U.S. save a collective $14,000 annually, compared to renters living alone.

Utility bills in the U.S. such as electricity, water, and gas are not typically structured on a per-person basis (unless it’s a furnished, all-included apartment).

This means that a single person will have to pay the full cost of these bills, while a couple could potentially share monthly usage and split the cost between them (e.g., If the lights and air-conditioning are on for one, they’re on for both anyway) — this can add up to a significant difference in the cost of living for a single person.

It’s also important to note that living alone can also mean that one person is responsible for all of the costs associated with running a home, including furniture, appliances, and other household items that are needed to make a home livable.

By the Numbers

According to the U.S. Bureau of Labor Statistics’ 2021 Consumer Expenditure Survey, the average single person spends about $48,000 annually, of which $17,899 is spent on housing.

In comparison, the average married couple spends about $76,000 annually, of which $24,811 is spent on housing — $12,405.50 each.

More recently, the Bureau reported the price of shelter soared 7.5% year-over-year in December, as housing prices continue to rise.

More specifically, the rent of primary residences increased 8.3% from December 2021 to December 2022.

Resources to Help

MIT’s Living Wage Calculator, which takes into account a number of factors including food, health care, housing, and transportation costs as well as taxes and other necessities such as personal care and clothing, estimates how much a single person in the U.S. needs to earn in order to stay above the poverty line without outside help.

Zillow also offers a rent affordability calculator for people living alone or with a roommate or partner to set a realistic budget and determine if the “singles tax” is something they’re able to afford.

Zillow has a variety of additional resources available on its site and within its app to help couples, roommates, and independent renters make the best financial decisions and find the perfect apartment to call home, including a move-in date filter, renter’s hub, automated tour scheduling, and soon will be adding a “rooms for rent” search option to its app.

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