Most people will find themselves renting a place to live at some point in their lifetime. Making the right rental decisions is important to your overall satisfaction with your home. There will be many questions that come to mind. Should I buy a home or rent? How long will I stay in one place? Will I be okay with less privacy in a rental situation? All very important questions, so you’re wise to look carefully at all aspects of your housing choice.
Below is a brief discussion of the advantages and disadvantages of renting a home:
Depending on your financial situation and preferred style of living, there are many advantages to renting:
· Renting a home can be cheaper than buying a home. Your rent payments tend to be lower than a comparable house payment. Also, your rent may cover your utility costs—an additional saving.
· You tend to have more flexibility when you rent. Most leases run for 12 months, after which time you can move or renew your lease. So, if your job requires you to move frequently, renting can be a desirable alternative to owning.
· Your landlord—not you—is responsible for performing nearly all maintenance and repair work on the property.
Renting a home does have some major financial disadvantages to consider:
· There is no tax break for renting. You won’t be able to claim any deduction for mortgage interest when you file your tax returns.
· Your housing costs aren’t fixed like they are with a fixed-rate mortgage, or even a capped ARM. Your rent can be increased with no end in sight.
Evaluating your Rental Options:
These are many types of rental housing units; these represent the most popular options:
- Private owned house/room/condo
- Apartment complex
- Public Housing
Once you know what your housing needs are you will need to evaluate the type of rental unit that meets your needs.
Privately owned house / Room / Condo - These rental units can consist of a whole single family house, renting a floor of a single family house or even just a room for rent. The same applies for rentals of a condo or space within a condo. Remember, unless you are renting the entire house or condo you may have to share portions of the living space, such as kitchen and bathroom. When you share a rental unit you may be sharing with the property owner or another tenant/renter. These units are typically privately owned and maintained, but can also be operated by a property management company.
Apartment Complex - These are typically large multi-story housing complexes with hundreds of rental units. Apartment complexes are typically operated and maintained by property management companies. They usually have varying size rental units, such as a studio, 1 bedroom, 2 bedrooms and 3 bedrooms, sometimes with a den. Normally all size units have a minimum of a private kitchen and bathroom. These complexes usually have shared laundry facilities, sometimes have swimming pools, playgrounds and other shared usage areas.
Public Housing - These are affordable rental units for low-income people or families, the elderly or people with disabilities. Public housing is supported/subsidized and possibly maintain by government and/or non-profit funding. Sometimes the subsidy is provided through a voucher program that requires prior approval. Public housing can consist of single family houses, 2-to-4 family structures, apartment complexes or condo units.
The search is on:
So where do you find listings of rental property? The answer is there are many resources. Here is a sample:
- Apartment Guides – normally free and can be found near the entrance of most convenience and grocery stores. Some realtor offices may also have these guides.
- Classified or Want Ads – Local newspapers, PennySaver type circulars are also located at convenience and grocery stores. You can access newspapers and other periodicals at your local public library as well.
- Internet – Wow! If you don’t have a computer at home or work, go to the library and search the Internet for rental housing information. Just put into a search engine what you are looking for and you will get a wealth of information.
- Counseling Agencies – Most housing counseling agencies will provide rental housing assistance or will refer you to an agency that will provide help. Some have free information to give you, some will provide assistance with Internet searches as well as locating financial assistance if necessary. This is also a great resource for public housing assistance.
- Referral – These are no better source for a recommendation then someone that current rents or has recently rented at a certain location. Referrals and/or references for rental housing is a great source and can help you avoid a bad-housing experience.
- Library – As indicated above you can reference the Internet, use newspapers and use periodicals in the public library. There are also useful guides on what the rental experience involves.
Your Rights and Responsibilities
Fair Housing: There are two federal laws that landlords must follow when selecting tenants for rental housing. They are the Civil Rights Act and the Fair Housing Act. The Civil Rights Act prevents discrimination based on race and the Fair Housing Act prohibits landlords from discriminating based on race, color, sex, national origin, family status, disabilities or religion. Many state and local governments have fair housing laws as well. These laws are intended to give everyone equal access to available housing.
Your lease/rental agreement: Some landlords and tenants have been known to have oral agreements, we highly recommend that you and your landlord put all agreements in writing. Your lease or rental agreement will establish the legal terms and obligations for you the tenant and those of your landlord. Basic leases should include the following:
- names and signatures of the tenant and landlord;
- the date the lease/rental agreement was signed;
- the address of the unit being rented;
- the beginning and ending dates of the rental period;
- the amount of the monthly rent the tenant must pay;
- the date the monthly rent is due and late fee assessment information;
- penalties for returned checks should be addressed;
- the amount of any security deposit, how it can be used or not returned;
- the amount of notice required to terminate the agreement;
- where and how notices are to be delivered, and always in writing;
- disclosures regarding lead-based paint and other hazardous conditions.
Other provisions to consider:
- are the cost of heat, hot water, electricity, or other utilities the responsibility of the tenant or landlord;
- provisions for monthly rent increases;
- can the tenant sublet the apartment;
- who is responsible for making repairs to the rental unit;
- can the unit be used for a home based business;
- can alterations be made to the rental unit;
- when the landlord may enter your rental unit, and related prior notice;
- access for exterminators, painters, or other maintenance works;
- any storage space(s) that the tenant may access and the restrictions of use;
- legal fees for lease/rental agreement enforcement.
Seek legal help if your landlord does not have a standard lease/rental agreement that covers many of the terms listed above. And keep in mind that even a standard lease can be mutually amended by writing the changes on the agreement and signed by all parties to the agreement.
We also recommend a pre-occupancy inspection of the rental unit to make sure its condition is acceptable and to address issues the landlord should fix prior to moving in.
Getting moved in: Your landlord may offer an orientation session at the beginning of your tenancy to welcome you and bring to your attention certain amenities of the rental unit and/or complex. The orientation may include:
- a tour of the premises and identify common areas;
- demonstrations of how to use appliances, security systems, heating and air conditioning systems, etc.;
- a review of the areas services such as trash collection, recycling requirements and newspaper deliveries;
- provide information on cable television options;
- who to contact for repairs and maintenance;
- a discussion on house rules and regulations;
- restrictions on moving furniture in or out of your rental unit.
Insurance: You need renter insurance. It’s not very expensive and can absolutely give you more piece of mind. Here is a personal story from one of our employees:
“In the late 1960’s my family was renting a 2 bedroom apartment in Hyattsville Maryland. We had lived in this apartment for several years and it was in reasonably good condition, at least there was no evidence that something was wrong. One Sunday evening my family was out for dinner, upon our return we found that we could unlock the front door but something was making difficult to push it open. While we were gone the entire living and dining room ceilings fell to the floor. Most of our furnishings were destroyed or damaged. And because the ceiling was plaster and lathe, the mess and dust were everywhere. The disruption to our lives continued until a new ceiling was installed, finished and painted, nearly a month after the ceiling fell. The property management company were very helpful, however we able to get back on our feet faster because we had renter insurance.”
Make sure you understand what your renters insurance will cover. Shop around for the best rate on you policy.