Getting into rent arrears is never good and while there is help available it better not to get into rent arrears in the first place. One way it can be avoided is to consider the following expenses before moving in.
If you are a private rented tenant, you need to consider the following when ensuring you can afford your rented accommodation.
- Rent – As rent will be your biggest household expenses each month, it is important that you determine whether you can afford the rent before moving in. The starting point is looking for the average rent is for the properties in the area where you want to live. Whether you are working, or claiming housing benefit, you need to note the date your rental liability is due and ensure that payments are made on the due date. Rent due is usually paid at the beginning of the term (month or week) and in arrears. You should also be aware that in the majority of private rented accommodation, as well as paying a deposit you will need to pay rent in advance (this is usually to cover one or two months, but can be longer).
- Tenancy deposit – private landlords and letting agents will usually ask that private rented tenants pay a tenancy deposit before moving in. The amount of the deposits will vary, but are usually equal to four to six weeks’ rent. As such, you need to ensure that the money is available in advance, either through savings or if you are on low income or benefits, through Discretionary Housing Payment. Alternatively, some local housing authority schemes may help private rented tenants in finding a landlord who will rent to you if you are claiming housing benefit; this may be seen on the local housing authority’s own website.
- Rent in advance – as stated above, in addition to paying a deposit, you will usually need to pay some rent in advance. This is usually one month’s worth, but it could be more. Again, help may be available by way of Discretionary Housing Payment’s for those who cannot afford to meet the payment, but need to move.
- Letting/Managing/Estate Agency fees – if you rent your property through a letting agency, you will usually be charged a fee that covers things such as credit checks, references and administration. It is unlawful for letting agents to charge you just to view a property. The average cost of letting agency fees in 2013 is around £350, according to Shelter research. As amounts vary between agencies, you should ensure you ask about fees or charges; you may be able to negotiate fees before handing over any money.You should also check that the letting agent or estate agent you use is a member of a professional body. If they are, it should be easier to get help with complaints or disagreements. The main professional bodies are:
• National Approved Lettings Scheme (NALS)
• Association of Residential Letting Agents (ARLA)
• UK Association of Letting Agents (UKALA).
• National Association of Estate Agents(NAEA).Each of these organisations lists its member letting agencies on its website, so you can find one in your area.
- Council Tax – Most people who have a rental liability will have to pay Council Tax, either within the rental liability or outside this liability. The amount you must pay depends on your local authority. You should ask your local authority or ask the landlord/letting agent how much the Council Tax is for the property.
- Service charges – these charges are often charged in blocks of flats for expenses such as improving the communal areas, maintenance and repairs. Again you should ask the landlord/letting agent about these charges if you are looking to rent a flat.
- Household bills – as well as the rent and council tax, you’ll also need to make sure you have enough money to pay household bills. Expect to pay for gas, electricity, water, a TV licence, and telephone and broadband. You can usually choose to pay each month, quarterly (every three months) or yearly. Shop around for deals to reduce your costs. If you move into a shared house, these bills will usually be shared between the people living there.
- Moving costs – if you have a lot of belongings to move to a new house, you may need to hire a van or a removal firm to help, as well as buying boxes. The Local Authority may be able to help with these costs via Discretionary Housing Payments.
- Housing Benefit – these are payments from the local authority to help people who are not able to fully afford their rent. Recent changes to the benefits system, including the cap and ‘spare room subsidy’ (as the Government are trying to ban agencies/authority saying this is a tax) means people will unfortunately, but inevitably, need to look smaller accommodation (possible making themselves overcrowded) or properties with low market rent (away from family, friends, work and school).
