The Total Cost of Renting a Home
You’ve found your dream flat – the location’s great, the photos look lovely and judging by the price listed online it’s a steal. However, it’s not always as simple as it looks; there are often hidden costs involved that won’t be included in the listed price. To make things more transparent, we’ve put together a run-down of any costs you may have to pay during the rental process.
Can I negotiate on a rental price?
The official rental figure – your monthly amount – isn’t set in stone. You can make an offer on the asking price, but you can also negotiate to save yourself some money.
Before making your offer, it’s a good idea to check the prices of similar properties in the area to see if the asking price is reasonable. These can vary depending on the furnishings and state of the building, so it’s also worth carefully assessing these elements when you visit for a viewing.
You can also negotiate the length of your tenancy or ask your landlord to include bills within the rent. If you do come to an agreement, it’s important to get everything in writing so that you can refer back if there are any issues further down the line.
However, you should be aware when negotiating that there’s a risk the property could be offered to another prospective tenant.
What are the upfront costs of renting?
Before moving into your rental property, you will have to pay a holding deposit (equivalent of one weeks’ rent), which is deducted from the first month’s rent. You’ll also need to pay a security deposit (the equivalent of up to 5 weeks rent) if the landlord isn’t using a zero deposit scheme.
If you’re a private tenant, you can’t be asked to pay fees for credit checks or references when starting your tenancy. Always be sure to get a receipt from your landlord or letting agent when any money changes hands; you’ll need this in case of any problems.
What bills do I have to pay for when renting?
Bills are an unavoidable aspect of living in bricks and mortar and may include gas and electricity, water, council tax, TV licences or subscriptions and broadband. Some or all of these could be included in your monthly rent, but more often than not they will be your responsibility. Always double-check with your landlord to clarify what is and isn’t included, and make sure to budget for any unincluded bills when choosing your rental home.
It helps to calculate any utility costs before you move in; your landlord is obliged to give you an energy performance certificate (EPC) before your tenancy starts, which will give you the property’s energy efficiency rating and an estimate of heating, lighting and hot water costs. You’ll automatically be signed up to an energy supplier, but if you’re unhappy with the rates, you can shop around other suppliers for a better deal.
Top tip: Make sure to read the meters before you move in and record your readings, so you won’t be liable for any energy usage prior to your tenancy.
Do I need insurance when renting and how much does it cost?
An additional cost that you may want to consider is tenant’s insurance, also known as renter’s insurance, which is designed to cover you in the case of unexpected events such as a break-in or an injury on the property.
Policies and prices vary, but as a rule of thumb, the more you pay for insurance the higher your coverage limit – the maximum amount of compensation you are entitled to – will be, so it’s worth weighing up how much compensation you might need before choosing a policy.
Rental prices can be negotiated, though you want to show the landlord that you’re a serious renter and shouldn’t go too far under the asking price. Before signing your tenancy agreement, you should make sure you have established the details of all costs involved so that you know exactly what you’ll pay once you’ve got the keys to your new home.