Renting: Getting Financially Prepared

The current housing market has made renting something that is increasingly important. It is just a part of the way that we live now. House prices have gone up and up, and wages have not risen in the same way. This then means that getting onto the property ladder and buying a first home can be further off than it would have been two decades ago. So for many people in that situation, renting is the only way forward, for now.

Get Financially Prepared For Renting a Home

Why Rent?

Property for rent is what you as a renter will be looking for. But it does also offer options to those people that are looking for some flexibility. Whether you are looking to move somewhere new or to downsize. Renting is not as big of a commitment than owning a home, but it does still take time and money in order to find the right place to live. There will be many things that you have to consider around a rental property. Here are some of the things that you should think about when it comes to choosing a rental property that is right for you. 

Price V’s Budget

The price or somewhere, and the budget that you have, is what is going to make a big difference with your finances. After all, if you don’t have enough money in your budget to rent a particular place, then it means that one is out of the question. So knowing your finances really is key. For example, if you’re renting a house in an affordable city like Milwaukee, then use some reports to make sure you understand area pricing. If the area is just too much for you, then it is time to look somewhere different.

Not only do you have to think about the base rental price, there are other significant costs to consider when starting a tenancy somewhere new. These are things like: 

  • A refundable deposit, usually around one month’s rent, that needs to be paid up front. 
  • Likewise, your first month’s rent is usually required in advance too.
  • A security deposit can be taken as well, which will depend on the landlord. But it could be as much as five weeks rent. 
  • Purchasing furniture if you’re planning to move into an unfurnished property or one that is part furnished.
  • Bills, phone bills, internet, and local taxes. Sometimes these things will be included in the rental price. But it’s worth checking what the totals will be each month to see if they can be afforded in addition.

So it really is key to make sure that you take all of these costs into account when you start out looking for a property to rent. There are more costs to just what the advertised rental costs are.

Getting the Right Cover

While it’s not a legal requirement, a landlords’ insurance policy can include a number of useful features, such as buildings insurance, accidental damage cover and financial protection against loss of rent.

Obtaining a home warranty is probably one of the smartest investments you can make for any property. Why? Because your homeowners insurance only covers what could happen (like a fire or flood). A home warranty, on the other hand, covers what will happen (like an appliance breakdown). Luckily, you can find home warranty information on House Method to help you select one that’s right for you.

Taking the next step

Renting can be a good way to get you out on your own as you work and establish a career. You just need to make sure that you are planning ahead, budgeting well, and not paying any more than you need to.

If you’re hoping to buy your own home in the near future, you will need to save up for a deposit on top of making your rent payments. To help you on your way you could look at increasing your income, moving to a cheaper place for a while, and/or reducing your outgoings. 

Here’s to achieving our financial goals and home goals sometime soon!

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