To see how much rent you can afford, you first need to add up all of your other expenses. Read on for an overview of the upfront and ongoing costs you need to consider before deciding whether or not you can afford the rent.
Renting a home involves more than just being able to pay your rent.
Here’s a list of the most common bills you should expect to pay as a tenant.
Ask the agency, landlord or previous tenant to give you estimates for these bills when you have a look around the property.
Use the links below to check Council Tax and rates bands for specific addresses:
Bear in mind you will probably have extra monthly bills to pay, such as:
Use our Budget planner to get a detailed breakdown of your spending.
You should also try to make a realistic estimate of what you’ll spend each month on other day-to-day expenses such as:
If in doubt, over-estimate rather than under-estimate.
You don’t want to risk getting into debt after a few months because you forgot to factor in one of your regular monthly payments.
Once you have estimates for each of these items, you can draw up a budget so you can calculate how much rent you can afford.
This will show you exactly how much money you have coming in each month and how much you have going out in expenses.
Then you’ll have peace of mind you will have enough money to live on, once you have paid your rent.
Remember to divide an annual expense - such as paying for Christmas or a summer holiday – by 12, so the cost is split evenly across the year.
Before you sign the tenancy agreement, you’ll need to make sure you can afford to pay the costs of moving into the property.
Remember to budget for up-front costs such as rental deposit, agency fees and removal fees.
The rental deposit is typically four to six weeks’ rent.
This is likely to be hundreds of pounds – and in some cases a thousand or more – so make sure you have these funds available before you commit yourself.
You should get your deposit back at the end of the tenancy if there has been no damage.
If you don’t have the money for a deposit, ask your local council to find out whether there are rent deposit, bond or rent-guarantee schemes in your area to can help you.
But bear in mind not all landlords and lettings agents will accept deposits in this form – you’ll need to ask.
Compare agency fees early on – for example ask what they will charge you for getting references and drawing up or renewing the tenancy agreement.
If you go through a lettings agency, it might charge you a range of fees.
Some lettings agents have started charging unsuspecting tenants up to £600 in agency fees.
Often the charges do not seem to relate to the cost of the work involved.
For example, charges for checking references range from £10 to £275, while charges for renewing a tenancy range from £12 to £200.
Get local estimates for these.
You can probably save yourself money by hiring a van and doing the job yourself, if you’re up to it!
If you’re moving to an unfurnished place, don’t forget to budget for the cost of furniture and soft furnishings such as curtains.
For more money-related information if you’re renting, read our guides: