Renting Costs To Consider

Are you searching for a place to rent? Before you start looking for the perfect home to rent, you should ensure that your finances are in order. This starts with giving some serious thought to your overall finances and how much house you can actually afford. After all, there is no point in spending time looking at potential homes if you have not worked out all the costs. Besides this, it is quite futile to view homes if you haven’t got your finances arranged in advance. In this article, we will look at some of the key renting costs that every beginner should know before looking for a property to rent.

Monthly rent

One of the first questions that every renter should ask themselves relates to how much rent they can comfortably afford to pay each month. As a renter, rent is going to constitute the largest portion of your housing costs. With this in mind, your first priority needs to be working exactly how much you can afford to spend on rent each month. The amount of money you can afford to spend on rent is primarily determined by your earning capacity. For first time renters, it is essential to avoid over-stretching yourself and committing to rent a home you can barely afford. Spend some time carefully working out your budget so you know what rental price bracket to search in.

Deposit

A deposit is a one-time sum of money that a landlord collects from a tenant in addition to their first month’s rent. This amount can be a flat fee or it can be based on the monthly rent amount. In most cases, the deposit is equivalent to one, two or three month’s rent. Collecting a deposit is not a legal requirement but most landlords insist on it as a means to protect themselves financially if a tenant causes damage to a rental or leaves unexpectedly without paying rent. Remember that you will have to pay the deposit together with your first month’s rent. Needless to say, this can put a hefty dent in your finances.

Bills

Besides your monthly rent and the security deposit, there are other expenses that you have to budget for. To start with, as a tenant you will be required to pay council tax. Council tax is generally calculated based on your rented home’s valuation as well as your local authority. Moreover, you may be responsible for paying the gas, electricity and water bills. Check your tenancy agreement to get clarity on both landlord’s and your financial obligations. In addition, check if you are required to pay service charges for the maintenance, upkeep and cleaning of communal areas.

Furniture

Unless you are moving into a furnished property then you will need to budget for furniture. Depending on the furniture you require for your rental property, you will probably need to set aside a substantial amount of money to kit out your new home. One way that renters go around this is to get old furniture from friends and relatives or buy used furniture.

Paperwork

Landlords, property managers and leasing agents will need to verify that all your paperwork is in order. This is particularly true so they can verify that you can actually afford to pay rent and you will be able to consistently make the rent payments. In addition to character references and proof of income, landlords will require a credit check on you. With this in mind, put money aside to be able to foot the bill for credit checks. Once all the checks have been satisfactorily carried out, you will get approval to rent the property.

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