Advice on renting: Costs to consider in your monthly budget – H is for Home

As we’re still learning to navigate the ongoing cost-of-living crisis, budgeting appropriately has become vital. And with soaring rents leaving some tenants facing increases of up to 60%, many areas are now considered unaffordable when compared with average wages.

If you’re feeling concerned about managing your finances and being able to pay your rent on time, it’s crucial to adapt your approach to budgeting.

What will my expenses be as a private tenant?

Monthly rent

The largest cost and commitment you’ll need to be prepared for when you rent is the monthly fee for living in the property. Usually paid by standing order or direct debit to your landlord or letting agent, rent must be paid on time each month and in advance.

If you fail to make payments promptly, you risk being taken to court for rent arrears or even evicted, depending on the type of tenancy agreement that you signed.

Deposit

If you’re still looking for a place to rent, you’ll need to have a large sum of money in your account ready to be used as a deposit. This is normally equivalent to five weeks’ rent but could be more or less depending on the property.

Furthermore, even if you’re already living in a rented property, it’s worth keeping a set amount saved and waiting for your next move. When you leave your current property, you may not see your deposit returned instantly – so it’s a good idea to be prepared.

Renter’s insurance

Looking after your belongings is crucial, regardless of where you’re planning on living.

Even though your landlord will be responsible for major maintenance and repairs to the house, your tenancy agreement alone may not cover you in the event of theft or fire.

Obtaining comprehensive tenants’ insurance could help to protect you against unforeseen circumstances, so we’d always recommend comparing prices online before you move house.

Utilities

Utilities include bills for water, gas, electricity, Wi-Fi and council tax.

The cost of council tax varies according to each local authority, so make sure you check what you can afford before you start viewing properties in a new area.

Combined, these expenses can quickly become expensive, so we’d recommend working out your monthly totals and moving a set amount into a separate bank account as soon as you get paid. If you like to watch TV, you’ll also need to cover the cost of a TV licence in order to access mainstream channels in the UK.

Furniture

If you’re new to the rental market, you may not be aware that not all properties come with high quality furnishings and fittings. Unless you’re moving into a shared house, it’s unlikely that your living space will be equipped with the furniture you need to call the house your home.

When you’re planning your budget, you should factor in the cost of chairs, tables, sofas and soft furnishings for your new space.

Renting in the current economic climate is expensive, but it can be an invaluable steppingstone for those seeking independence or working in a new city. If you have any urgent concerns about your situation as a tenant or need advice on renting, don’t hesitate to get in touch with your local Citizens Advice.

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