From Rookie to Renter
Everybody starts somewhere, but sometimes it’s hard to know where to begin. Here are three key tips from June on how to prepare for your journey as a first time renter.
Determine Your Budget
Calculate exactly how much rent you can afford
Traditionally it’s recommended that you spend no more than 30% of your net income on rent, but this advice is almost 50 years old. Try the 50/30/20 rule instead: spend 50% of your income after tax on basic needs (think rent and monthly utilities like gas, water, electricity, internet), 30% on non-essentials, and 20% on savings.
Or try this Rent Affordability Calculator.
Take all expenses into account
Rent is your biggest expense but it’s one of many. Remember to take all the costs that come with being a renter into account. On top of rent, you’ll pay for monthly utilities like electricity, gas, water and internet too. Before moving in, you’ll also need to make upfront payments like first month’s rent and a security deposit, which your landlord will hold in case any damages occur during your lease. Don’t forget moving-day costs and new home purchases too!
Consider how you could cut costs
There’s always a way to spend smarter. Living with roommates means splitting up utility expenses, choosing a location from which work and socializing are accessible lowers your transportation costs. As a first time renter plan to do what you can to save what you can.
Calculate Exactly How Much Rent You Can Afford
Decide on non-negotiables
Apartment hunting can seem to take forever because it can be difficult to find one place that checks all your boxes. Find your closest match by deciding what matters most to you: do you need in-unit laundry? Do you want to live alone? Do you need a pet-friendly building? Make a list of your non-negotiable needs and wants to know where you’re flexible and where you’re not.
Prep questions before tours
The best time to ask questions about a home is when you first see it. Getting answers upfront will save you time, energy and stress. When preparing questions beforehand, consider your future day-to-day in any home you’re touring. What will be the process for any maintenance and repairs? Does the building have any future construction plans? Have there been any problems with pests in the past?
Understand the lease terms
A lease is a big commitment, so it’s important to understand all its components and terminology before signing, especially if any are at odds with your list of deal-breakers. Lease terms also cover what the landlord will permit you to do as a tenant. For example, what could prevent you from getting your security deposit back, the penalties for ending your lease early, whether or not you would be able to sublet.
Get Application Ready
Get your finances in order
Ultimately, landlords want to be confident that your rent will be paid throughout your lease (especially when you’re a first time renter). So along with proof of income, landlords may also require proof of good credit history in your application. If you don’t meet their requirements, you can ask the landlord if they’re open to using a guarantor. This is someone who will co-sign your lease and commit to making your rent payments if you can’t. A guarantor will then need to meet certain financial requirements themselves, and you’ll need to include proof of their financial status in your application.
Gather a first time renter important documents
Application requirements vary, but it’s important to be prepared to back yourself up with following documents.
- Identification: You will likely need to provide a government-issued ID, such as a driver’s license or passport, to prove your identity.
- Proof of income: Landlords may ask for proof of your income to ensure that you can afford the rent. This could include pay stubs, tax returns, or a letter from your employer.
- Rental application: Most landlords will require you to fill out a rental application, which may ask for information about your employment, rental history, and credit score.
- Credit report: Some landlords will run a credit check to see if you have a good credit history and are financially responsible. You can obtain a copy of your credit report from one of the three major credit bureaus: Equifax, Experian, and TransUnion.
- Reference letters: Landlords may ask for reference letters from previous landlords or employers to get a sense of your rental history and reliability.
- Security deposit: Many landlords will require a security deposit, which is typically equal to one month’s rent. This deposit is used to cover any damages or unpaid rent when you move out.
- Renters insurance: Some landlords may require you to have renters insurance, which covers your personal belongings in case of theft, damage, or other losses.
Recommended article:A New Generation of Renters: How GenZ is Changing the Apartment Rental Game (Infographic)
WHY RESIDENTS RENT WITH JUNE
Fair rates in line with local rentals, no broker fees, and a way to skip security deposits.
Rent furnished or unfurnished, with roommates or alone, and for one – 18 months or longer.
Discover, tour and apply for a move-in-ready home online and in a matter of hours.
Enjoy a guarantor-friendly and visa-friendly application process, as well as 24/7 support and monthly resident perks once you’re living with June.