Plot

Maris repossesses Niles's car and his legal bills exceed his salary. He is forced to drive a hatchback and give up his apartment at the Montana for a tiny studio at the "Shangri-La."

Driving to Niles' apartment at the Montana with the intention of taking him to dinner, Frasier and Martin are astonished to see Niles drive past them in a cheap hatchback. When Niles sees them, he makes haste to get away from them as quick as possible. Bewildered by his actions and incensed by his bare-faced claims that he is in his apartment when calling him on his car phone to question him, Frasier eventually gets Niles to admit that he has been forced by his on-going divorce from Maris to buy a cheaper car, as his Mercedes has been repossessed. Back in his apartment, Frasier suggests that they make a list of his expenses in order to enable him to economize; it soon becomes apparent that his apartment is by far his greatest expense. Although Niles insists that it is modest (despite having three floors and possessing a library, a study and a gift-wrapping room) and pleads that his ability to get into the Montana was a necessary ego-boost after his wife's abandonment, Frasier eventually convinces him that he has no choice but to move out in order to avoid bankruptcy. He allows Niles to stay with him, but after two weeks, his picky habits have started to wear on the nerves of everyone else present. Frasier vows to help Niles find an apartment. To that end, after a long day of apartment searching, both men find themselves at the Shangri-La, a cheap bachelor's apartment complex that falls well below their high standards; unfortunately for Niles, however, it is the best that he can afford, and upon learning that he has outstayed his welcome at Frasier's, Niles has no choice but to move in.

Owing to a vengeful Maris, a cash-strapped Niles (David Hyde Pierce) must move out of his luxurious apartment and temporarily share Frasier's (Kelsey Grammer) high-rise digs, but his compulsive rearranging of Frasier's bric-a-brac-not to mention his detailed bedtime hygiene regimen-only drive the host nuts. As a result, Niles has to find new accommodations at the less-than-glamorous Shangri-La apartments.