“Neither a borrower nor a lender be,” is Polonius’s oft-recited quote from Hamlet. Shakespeare reminds us that financial interactions can often place strains on personal relationships. Living with friends, or indeed, strangers, in shared accommodation can sometimes bring difficulties when it comes to the paying of shared bills, or in determining the amount of rent to be paid by each housemate.
SplitTheRent, is a site that allows housemates to calculate and allocate shared expenses in a fair and neutral manner. The site, currently in beta, offers a free rent-calculator, and functions for assigning utility expenses, tracking payments, and issuing notifications when payments are due or late.
SplitTheRent’s co-founder, Jonathan Bittner, is a student of Astrophysics at Harvard University. So how did he come up with SplitTheRent? Surprisingly, the idea did not arise out of bad renting experiences.
“I’ve always had great rooming situations but it’s just such an interesting problem. I lived with my girlfriend and a flatmate two different times before, and that’s a really confusing situation, because if the rooms are similar and you split it equally, it sort of feels unbalanced, because you have much less space than the person who’s not in a relationship — you have two people sharing a little teeny room and one person has a whole big room to themselves. I really like ethics and math and I was thinking,“what is the right way to do it?””
The rent calculator works off the same price per square foot formula that estate agents often use, but Jonathan wanted to take into account some of the other factors that make a room more desirable, such as a window, storage space, or sound isolation.
“Splitting by square foot, that was my hypothesis. I thought that made sense. I didn’t really have any idea how to handle windows and those things, so that’s one of the reasons I needed a survey. I basically just asked all my friends, “assume that your apartment costs this much per month, and then how much more would you pay if it had a really nice window?”
“I just took the average of those responses and I turned it into a sort of a ratio instead of a dollar amount because different people in different places don’t want a window to be worth 50 dollars more every time, it depends on what the rest of the apartment costs. So I turned it that it basically just makes your room as if it were bigger, that’s the way the calculator treats them. And the amount that it makes your room bigger depends on how much extra people would have paid for it in my original survey.”
The calculations involved are not massively complicated, “It is simple in principle”, notes Jonathan, but the site’s real value lies in its impartiality; SplitTheRent provides an impartial third party to ask the awkward questions, and chase down the reluctant payer in the house.
“It’s painful to have to track somebody down who’s probably your friend, it sort of hurts to have to go chasing them down to collect your money, and that’s one of the biggest advantages, I think. My co-founder, Ryan Laughlin, lives with two of his good friends, and they found that if one of them went out to dinner and lent the other money for dinner, or if they bought groceries together, it was actually very helpful to have somewhere central to put it all so that they didn’t forget.
“If you’re the kind of house that splits lots of different things or lends each other money, a spreadsheet is maybe the way many people do it, but not everyone can use a spreadsheet, and a spreadsheet won’t remind you when the bill is due. So we thought that this website could solve a lot of little problems, even though it’s kind of a simple thing in principle to divide by three, it keeps things organised. We like that.”
Jonathan and Ryan are currently working on additional features such as the ability to change currencies, and to add recurring bills for fixed-cost utilities. A “good mobile site” that will, “work for Android and iPhone right off the bat” is also in the pipeline, while native apps may come in the fall, but Jonathan admits that the priority for now is making sure the Beta-site is“ rock-solid.”
There are no plans to make SplitTheRent a paid-content site once it comes out Beta. “We’re definitely going to keep the site free for all of the basic organisational features, just because we think it’s much nicer; a lot of people don’t want to invest in something they could have just put on the fridge; we want to be a helpful place for people to go, and we’re really interested in these fairness issues. I don’t think that we’ll be a good neutral third party to adjudicate disputes if you have to pay to get into the site.”