The Hidden Costs of Renting

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Never underestimate the power of cost. Whether you’re a first-time renter or a veteran renter, cost will haunt you. This could be in the form of monthly rent, commute to and from work, and groceries; however, there are many more costs that renters are not aware of.

Cost is the biggest area of concern for any renter. You encounter it monthly (if it’s rent) and daily (if it’s expenses). The reality of paying monthly rent should keep you on your toes about how much money you can afford to spend, however, there are other areas of concern regarding these costs, hidden costs, when it comes to renting, moving, and living in a home. These hidden costs can be pricey, and some renters don’t take them into account when planning their budget.

Hidden Cost #1: Application Fee

We might as well start from the beginning! All rentable homes will have a rental application that needs to be filled out by the tenant (you). Sometimes, these applications have extra fees that you should take into account. Now, they aren’t necessarily large fees, but there could be multiple fees that add up to a larger amount. Example: there is a $40 application fee required to submit your application.

Hidden Cost #2: Security Deposit

Security deposits don’t exist with every home, but some landlords require it. This will usually equal half of your first month’s rent, or one month’s rent. Most renters probably don’t think of this as a hidden expense, but in the early stages, the amount to pay for your security deposit can be a hefty amount of money.

Hidden Cost #3: Moving

Ah, moving day. The anticipation has been building for weeks, and now the day has finally arrived. The big question now is how are you planning on moving all of your things to your new home: by yourself or with a moving service? Either option could potentially be costly, but is one better than the other?

Using a moving service can be costly, but is better for a larger quantity of items.

When moving by yourself, you will probably think you can move all of your personal items in 1-2, maybe 3 trips with your car. And you’re probably right. But what about the big ticket items, like furniture? This is where a moving service might come in handy. However, an alternative would be renting a U Haul truck or trailer. If you decide to go this route, you could pay anywhere from as little as $20/mile – $50/mile. Find out more here.

If you’d rather go with a moving service, you will get your money’s worth. Granted, you may have to fork out a lot of dough, but in return all of your items and belongings will be transported safely to your new home. All you have to worry about is getting yourself there!

Hidden Cost #4: Utilities

Utilities might not seem like a cost that is hidden, but let’s not forget that utilities can take a good chunk of cash out of your pocket on a month-to-month basis. Depending on your landlord or utilities company, you may have the option to electronically pay vs. mail in a check. If you’re tight with your money and like to keep track of where it goes, mail a check. This way, you are aware that you’ve paid that money and you no longer have it. On the other hand, if you choose to pay electronically, it will be automatically withdrawn from your bank account. Since it is automatic, you likely won’t be aware that you’ve paid (most of the time). This is where the hidden cost comes into play.

Hidden Cost #5: Repairs & Maintenance

Nobody likes having appliances repaired in their home. This can include anything from fixing a cabinet door, to plumbing, to fixing or replacing a dishwasher. Sometimes, these repairs will be free for renters and is covered by the landlord. Other times, however, renters will need to bring in an outside company for repair. This will cost you money. While you might not need repairs often, depending on what needs to be fixed and/or replaced, you should be prepared to lose some money whether you like it or not.

Hidden Cost #6: Rent (but not really)

Whatever you do, don’t forget to pay rent!

Why is this a hidden cost? Well, it’s not. It’s the biggest cost you’ll ever pay while renting a home. Though it’s not necessarily a hidden cost, rent can surprise a lot of people. Just like utilities, you will likely pay rent either electronically or physically (by mail). Even if you choose to pay electronically, always make sure your payment goes through. Set monthly reminders to check your bank account and assure your rent has been successfully paid.

Always, always, always pay your rent on time! Rent is due monthly, and the day it’s due can vary from landlord to landlord. Failure to pay rent on time can lead to an even greater cost, as you may have to pay extra money for not paying on time. Other instances may lead to you completely losing your security deposit, or worst of all, you may get evicted. Don’t get evicted.

Hidden Cost #7: Pets

For pet owners, this might be the biggest hidden cost. You likely wouldn’t realize it, but pet owners probably pay a good amount of money on a monthly basis for food, toys, and anything for their furry friends. Now, depending on the type of pet you have, the costs will vary, but pets cost money nonetheless. Whether your realize it or not, that money will get spent very quickly if you’re not careful.

Another cost with having pets is that landlords may (or may not) charge for pets. This can include an upfront non-refundable pet fee, plus monthly pet rent (which can be pricey with multiple pets). So, if you’re considering bringing a pet to live with you, be sure to check your building’s pet policy.

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Photo Creds: Cover, Fragile, Rent