Renting out your own apartment is exciting and liberating, especially when you’re just moving out on your own for the very first time. There are various expenses that you don’t necessarily have to worry about that come with homeownership, including mortgage insurance, property taxes, maintenance fees, and others.
However, there are still plenty of other expenses that you will likely be responsible for covering aside from your monthly rent. It’s important to be aware of these expenses and factor them into your budget in order to make sure you’re comfortable and capable of handling these expenses.
Before you sign that lease, make sure you include the following costs in your overall monthly budget.
Many apartments come with a storage locker as part of the overall unit and associated rent. However, some units don’t. If your apartment doesn’t have a lot of space, or the storage locker that comes with it is too small to fit some of your larger items, you might need to rent out extra storage space.
Depending on your location and the size of the storage space, you could be looking at spending anywhere from $30 to $200 a month for the extra storage facilities.
It’s no secret that the majority of landlords require an up-front security deposit on top of your advanced rent payment, which is usually a few hundred dollars. The good news is that you can get that money back when you move out, but don’t expect to see a penny if you leave the place in shambles. If there are any repairs or improvements that need to be made before you vacate, the money needed to make such changes will come directly from that deposit. It can also be used to cover any back rent, damage, cleaning, or key replacement.
In addition, some apartments and landlords charge non-refundable move-in fees that you won’t get back, even if you leave the place in pristine condition. Make sure you read the fine print on your lease to see what money paid is refundable, and what isn’t.
Homeowners aren’t the only ones who are responsible for insuring their belongings. While the unit itself is the responsibility of the owner to insure, you are responsible for any coverage for your belongings, including your furniture, electronics, or any other valuables that don’t come with the apartment. You don’t necessarily have to take such insurance coverage out, but it would be in your best interests to do so. Not only that, your landlord may require it.
The good news is that renter’s insurance is typically a lot cheaper than property insurance, and can cost as little as $10 a month, depending on how much coverage you need. In the event of a fire or theft, you’ll be financially compensated for any losses suffered.
Before you sign a lease, make sure to find out if utilities are included, or if they’re extra. While many rent prices include utilities – such as electricity, gas, water, sewer, garbage, cable, telephone, or internet – others don’t.
If the particular apartment you are planning to rent out does not include utilities, find out how much they are first. Your landlord should be able to provide you with that information, after which you can include that figure in your budget and see if it’s something you can comfortably afford.
Some leases may stipulate a requirement for vacating tenants to bring the unit back to a certain condition before being released of all obligations under the agreement. If such a stipulation is part of your lease, you should expect to take on certain tasks to bring the unit back to its original state. That can include painting the walls or making any minor repairs to floors and other components. Such improvements cost money, which should be factored into your overall budget.
If you plan on moving your pet into your unit, your landlord may require a one-time up-front deposit in order to compensate for any potential damage that your furry friend causes.
This isn’t reserved just for rentals, but you’ll need to account for any moving fees associated with filling your new apartment with all your furniture and belongings. Even if you don’t hire a moving company to take care of the moving and decide to handle it yourself, you’ll still need to buy packing and moving materials like boxes and tape, and you may even need to rent out a van to make the job easier.
The Bottom Line
Renting is often the most affordable option for those who are just getting their feet wet in the real estate market. However, there are still plenty of expenses to cover aside from the monthly rent. Make sure you’re aware of such fees and tack them onto to your budget to make sure you’re signing a lease that you’re comfortable with.