Renting is a significant financial responsibility, and it’s important you understand this goes beyond just your rent payments. There are a lot of other costs you need to think about.
Estimate the cost of your rent plus bills
Renting a home involves more than just being able to pay your rent.
There might be a lot of other bills you might be expected to pay as a tenant.
Your landlord might be paying for some of these directly and charging you through the rent. So, it’s also important you understand what bills you’re responsible for paying.
Council Tax, utilities and service charges
- Water bills (usually paid monthly)
- Service charges (in some properties – paid monthly or annually)
- Council Tax (usually paid monthly – England, Scotland and Wales) or rates bill (NI)
- Gas and electricity bills (either by a pre-payment meter, or monthly by Direct debit)
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:
Check Council Tax bands via the GOV.UK website (England and Wales)
Check Council Tax bands in Scotland
Find out about rates for rental property in Northern Ireland
Other monthly costs affecting how much rent you can afford
Bear in mind you’ll probably have extra monthly bills to pay, such as:
- a TV Licence (paid monthly or annually – visit tvlicensing.co.uk to find out how much this costs)
- landline phone bill (plus any connection charges – can be paid quarterly or monthly)
- contents insurance (paid monthly or annually)
- digital TV or satellite TV subscriptions (paid monthly)
- broadband bill (paid monthly or quarterly).
Draw up a budget of all your costs
Try to make a realistic estimate of what you’ll spend each month on other day-to-day expenses such as:
- mobile phone
- food/clothes
- travel/car insurance
- childcare/maintenance
- gym/hobbies/nights out
- loans or credit card repayments.
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.
Don’t forget the upfront costs
Before you sign the tenancy agreement, you’ll need to make sure you can afford to pay the costs of moving into the property.
Find out more about what you can and can’t be charged for when renting by landlords and agents on the GOV.UK website
Rental deposit
Upfront costs
Remember to budget for upfront costs such as rental deposit, agency fees and removal fees.
Your deposit is likely to be the biggest expense if you’re renting a new place, so make sure you have these funds before you commit yourself. If you have a private tenancy and have paid a deposit to your landlord (or agent), by law it must be protected in a government approved scheme.
In England and Wales, refundable tenancy deposits are capped at no more than five weeks’ rent for assured-shorthold tenancies if the rent is less than £50,000 a year, and six weeks’ rent if the rent is more than £50,000 a year.
In England, you can find out more about the tenancy deposit protection scheme on the Shelter website
In Wales, you can find out more about the tenancy deposit protection scheme on the Shelter Cymru website
In Scotland, you can find out more about the tenancy deposit protection scheme on the Shelter Scotland website
In Northern Ireland, you can find out more about the tenancy deposit protection scheme on the NI Direct website
This money will be held in a deposit protection scheme and, if there’s no damage, you should get it back when you move out.
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 help you.
But bear in mind not all landlords and lettings agents will accept deposits in this form – you’ll need to ask.
Read about rent-deposit, bond and rent-guarantee schemes on the Shelter website
Get contact details for your local council on the GOV.UK website
Check out this helpful renting checklist on the GOV.UK website
Agency fees
Tip
Compare agency fees early on – for example, ask what they’ll charge you for getting references and drawing up or renewing the tenancy agreement.
Letting agents or private landlords in England aren’t allowed to charge admin fees for things like checking references, or renewing a tenancy for shorthold tenants, student lettings and lodgers living with a private landlord.
Letting fees are banned in Scotland, but are legal in Wales and Northern Ireland.
For example, charges for checking references range from £10 to £275, while charges for renewing a tenancy range from £12 to £200.
Fees can still be charged for late rent payments, ending your tenancy early or transferring your tenancy.
Removal or storage fees
Get local estimates for these.
You might save yourself money by hiring a van and doing the job yourself, if you’re up to it.
Furniture or furnishings
If you’re moving to an unfurnished place, don’t forget to budget for the cost of furniture and soft furnishings such as curtains.
