Out of the Nest Series: Establishing Your New Home
Renting your first apartment or house is a very exciting opportunity. Searching for the right place and ensuring that each ‘I’ is dotted and ‘T’ is crossed is attainable. This post points out key factors to help your apartment/home search and move go more smoothly.
Budgeting and apartment / home renting
If you read my last post about budgeting, you learned the importance of factoring in what you can afford per month for groceries, auto repair, savings, etc. Rent is just another component of your budget. It is important to determine how much you can spend on monthly rent. So make sure your new home fits in your monthly spending plan.
As you tour a place, here are some good questions to ask. Are there on-site laundry facilities? How much does it cost? (Be sure to include laundry costs in your monthly budget.) Is heat electric or gas? Is it included in rent or is it extra? Ask the landlord for the average previous tenants’ utility bill history for the apartment/home units you are considering. You can also call the local utility company and ask that information to help you plan your budget.
Roommates are wonderful for camaraderie, and also from a financial standpoint for both parties, as they can help share the cost of rent. With more roommates, less rent will need to be paid by each person. So consider carefully if sharing space and splitting rent is a good idea in your situation.
A security deposit is usually required by most landlords and is typically 1-3 months' worth of rent. While it's a one-time cost, it is crucial that you include this in your budget because it will be a large amount of money you will need to come up with. Do not set yourself up for disappointment: have some money already set aside so that if you find a place you really like, you do not have to turn it down because you are not financially prepared.
Location. Location. Location.
Consider the location of your new apartment before signing your lease. Location can add or subtract costs in several ways. The simplest way is the location itself; some areas are just plain more expensive than others. Then, consider the distance between home and work and/or school. If it is a 45-minute commute, think how much time and money you will spend just getting back and forth. Finally, how far away are other businesses you will need to visit, such as the grocery store? Finding a central location will help you save quite a bit of money in the long run.
For your first home, why buy new when you can acquire quality “new to you” items at goodwill or garage sales? Friends and family can also be very helpful as they may want to unload some unused items they have had for years. For my first apartment, my roommate’s parents wanted to give their dining room table to us. My mother also provided us with unused pans and dishes. The costs we saved by receiving donated items is huge and if you do a little asking or looking around, you can save money this way, too.
To help stay organized, I recommend keeping a written record of the apartments you have considered. You can write your thoughts down in a few sentences, including rent/deposit requirements, after reviewing a home option. Then compare each place while keeping in mind how much money you have set aside and your plan for furniture/other moving expenses. That way, you will have all the information you need to make an informed decision, along with making sure your new home is affordable.
By Joy Rasmussen
For more budgeting tips, read "Using Crisis Budgeting During Tight Financial Times."