Budgeting for rent

Beckly

Hello, sorry if this seems like an annoying and common thread, I have had a quick browse through but couldn't find the answers I was looking for.

My partner and I are looking to move into our first rented accommodation, but are unsure of the upfront fees we will be required to pay.

Average admin fee we've seen is max £200.

Average deposit on a £550 pm property is £650.

So as we understand it we have to pay the admin fee, deposit and first months rent which, based on the above figures, would be around £1400.

What other costs could be part of the moving process? Like when would the next months rent be due? - if we moved in on 1/10 would next rent be due 1/11? - when are bills such as electric, gas and water or council tax likely to come out? How much money should we have put to one side to cover these unknown costs?

We are eager to move as soon as possible but obviously don't want to leave ourselves short or struggling.

Elfbert

If you agree that the first day of your tenancy is 1/10, then yes, it's very likely that your next rent will go out on 1/11. You can, however, negotiate which day it will be, no matter which day you originally begin your tenancy. For instance, if you moved in on 27/10, but usually were paid on the 1st of each month, most landlords would be fine with you requesting to pay your rent on, say, 2nd of each month, to ensure you had the money!

The same with most utilities companies - they will be fine with you choosing a day when you know you'll have money! And often you can choose to pay monthly/quarterly etc. to suit your income.

You need to budget for 'moving costs' - hiring a van? Hiring removals? It depends how much stuff you have to move.

You should be able to find out your council tax rate, just ask which band the property is in and look it up for your area.

You may be able to ask current tenants for an approximate amount they spend on bills for the place, or the landlord. Remember you can switch the utilities to a better deal once you've moved in - you don't have to stick with whoever is providing it currently.

Do you also want Sky/TV/Broadband/phone etc? These all eat up money, even just a TV licence, phone and broadband.

If you say what sort of property you're looking at people can give you very rough guesses at the utility charges. Is it just the two of you? Kids? Looking for a flat? House? One bed? Two bed?

HappyMJ

How long is a piece of string?

Council tax should be an easy one to find out. The monthly figure is the annual figure of the banding of your property divided by 12. You need to pay in advance so the first monthly payment may be divided over the remaining months up until the last payment due in March.

Gas and electricity when paid by direct debit also needs paying in advance so you'll be paying more in the first year so you can catch up as you'll start in arrears. Paying quarterly in arrears will cost more.

Ask the water company but if you can't afford it you can arrange smaller payments as long as it's cleared before the next bill comes through you'll be OK. It shouldn't cost any more.

Beckly

I have made a comprehensive list of all bills as estimates. Looking at 2 bed semi's mostly as I will be providing respite care for a disabled teenager 3-4 nights a month, though most of the time it will be only him and me - I work mon-fri 9-5 and am out late on mon&tues nights and all Saturday day times. He works mostly evenings as a bar manager so it will usually be only one of us in the house at a time.

My phone. £19.99
His phone+tablet £100.00
Rent £600.00
Electric £50.00
Water £35.00
Gas £50.00
Council tax £110.00
Internet £50.00
Sky £45.00
My car £140.00
His car insurance £30.00
My car insurance £33.59
Petrol £400.00
MOT's £10.00
Road Tax £30.00
Food £200.00
TV licence £12-24
Online game. £10.00
My Credit Card £25.00
Cineworld £31.80
His Credit Card £100.00
His Loan £280.00
My loan £156.29
Lovefilm £5.99
Gym £45.00

I know some of these are luxuries but we will eventually want them so I might as well include them in a budget.

mouthscradle

Make sure that the letting agent admin fee that you've been quoted includes all the 'extras' that they like to add on, such as a fee for the inventory etc. You will probably also be charged a fee for any renewals after 6/12 months and this can be as much as £100+, as well as more fees when you leave for another inventory and for references and so on. They're sneaky!

Elfbert

HappyMJ wrote: »

How long is a piece of string?

Council tax should be an easy one to find out. The monthly figure is the annual figure of the banding of your property divided by 12. You need to pay in advance so the first monthly payment may be divided over the remaining months up until the last payment due in March.

I thought Council Tax was usually split over ten months? Although I believe you can ask to pay it over 12 months instead, these days. Don't you normally get Feb and March off?

dirty_magic

Can't you get a TV, phone and internet as a package? £95 sounds a lot, we pay less than £30! I suppose it's more of you want all the channels though.

Your budget sounds about right, but I'd raise it slightly for food. I budgeted £50 per week when we moved out, but we actually spend more than £60 most weeks. Don't forget you have to buy toiletries and cleaning stuff too; washing powder and things like that really increase your shopping spend. It does make a huge difference shopping at budget supermarkets so I'd recommend that!

Elfbert

You do have quite a few luxuries there, OP, but yes, may as well include them to make a realistic budget for you.

Do check the letting agent contract and the contract for the actual property, to check what's included in each. Especially the agent

You don't have to 'renew' after 6 months, but you may want to for peace of mind - and they will charge you whatever they can get away with for that!

Just get EVERYTHING in writing and signed for, from the get-go, as far as what fees cover and what they will charge you at the end of the tenancy etc.

And never sign an inventory without checking everything twice!

PasturesNew

You probably need to prioritise and group things together a little more. e.g.

These are Bills to keep the roof over your head:

Beckly wrote: »

Rent £600.00
Electric £50.00
Water £35.00
Gas £50.00
Council tax £110.00
Internet £50.00 (* pretty much need this these days, although yours is a bit pricey)
TV licence £12-24

Roof Over Your Head: £915

Costs of getting to work:

Beckly wrote: »

My car £140.00
His car insurance £30.00
My car insurance £33.59
Petrol £400.00
MOT's £10.00
Road Tax £30.00

Getting to work = £643

This is to stay alive:

Beckly wrote: »

Food £200.00

These are choices/lifestyle:

Beckly wrote: »

My phone. £19.99
His phone+tablet £100.00
Sky £45.00
Online game. £10.00
My Credit Card £25.00
Cineworld £31.80
His Credit Card £100.00
His Loan £280.00
My loan £156.29
Lovefilm £5.99
Gym £45.00

Cost of "fun" and choices £818

So, from that, there are some things you MUST pay, some you have some control over (e.g. reducing food bill) and some things you could drop, or will be dropping soon/at some point (e.g. loans or Sky).

Beckly

Huge thanks to all replies - I'm not too sure how to quote properly so can't reply properly, sorry!

Mouthscradle- it's things like those that we need to know about - if I asked a lettings agent while viewing a property "what are all the fees for this property?" Will they include inventory checks, etc in their answer or do they try to hide these?

Elfbert- this sounds very confusing, I really don't understand council tax. Would this be automatically taken from my account on a set day or is it something you set a direct debit to do? Also, you mention extra costs to renew - will these be set at the start of the tenancy? We only plan to stay 12 months then relocate but good to know this in case we do choose to stay.

Dirty_magic- thank you. We will predominantly be shopping at Aldi and as a support worker I frequently organise meals for our students based on £2 per person and can easily cook a meal for 3/4 off this budget so I will tentatively say this is a realistic shopping budget for us. As we are in the Karoo catchment area we cannot get a different internet provider. Our mobile/tablet bills will be reduced when contracts end in a few months, but there's nothing we can do about internet as we need the unlimited package and this is set at £50 for kc light stream.

Pasturesnew- thank you for the breakdown, really helpful to see that our lifestyle choices add up to almost as much as just keeping a roof over our heads! We are working on reducing debts as quickly as possible so within 6-18 months we should be debt free and therefore saving over £500 a month!

mouthscradle

One thing you haven't included is home contents insurance. I don't know if you're looking for somewhere furnished or not, but even if you don't own the furniture you should still insure your possessions.