Financial Considerations When Renting an Apartment
Choosing a new apartment is not as big as a commitment as buying a house, but it’s still an important financial decision that determines the place you will call “home.” Here are the financial considerations you’ll want to take into account when renting an apartment.
Length of the Lease
The most common lease term is 12 months. But some management companies will offer shorter-term leases for 6 months or longer-term leases for up to 18 months. In some cases, you may receive a small discount for signing a longer-term lease. You’ll also want to find out what the penalties are for breaking your lease early as well as if you will have an option to go month-to-month at the end of your lease term.
When is Rent Due?
Typically, the rent is due the first day of every month. But most landlords and management companies will offer some sort of grace period, usually 3-5 days. Just be sure to ask if there are late payment fees. Even if there’s a grace period, some will tack on a set amount or a daily rate for each day after the first.
What Utilities are Included?
Before you sign the lease, find out if any utilities are included in your monthly rent. In addition to obvious things like electricity and water, be sure to ask about sewer and trash pickup. Also find out if there any monthly or annual fees for parking, landscaping maintenance, and exterior upkeep.
Are Deposits Refundable?
Find out if your security, cleaning, and pet deposits (it applicable) are refundable. They usually are, provided there is no significant damage to the unit, and you leave it as clean as it was when you moved in. On move-in day, be sure to tour the unit with the property manager to find any existing damage and note it on the lease, so you don’t end up liable for it when you move out.
How Much Notice is Required Before Moving Out?
Confirm with the property manager how much notice you need to give before moving out. It’s usually 30 days, but some require as long as 3 months. It’s really important information to commit to memory, so you don’t end up breaking your lease and paying penalties.
If you are renting an apartment for the first time or transitioning back to renting after homeownership, our Rental Counseling can help you prepare to make smart decisions.