Helping renters move with the times
KEY TO A MORE SECURE TENANCY AS AVERAGE RENTS HIT £1,100
RENTS are going through the roof, along with everything else right now, making this a tough time for tenants.
More than five million households rent from a private landlord, double the number in 2000, as high house prices and low wages squeeze young buyers off the property ladder.
And so-called Generation Rent isn’t just made up of young, single people seeking flexible lifestyles.
One in four families lives in a private rented home and a third of private renters live with children, according to estate agency Knight Frank.
The average rent in the UK now costs £1,091 a month, or £13,092 a year, up 9.5% in the past year.
In London, rents jumped 14.2% to a scarcely believable £1,804 a month, according to the HomeLet Rental Index, but they also climbed above £1,000 in the South West, East and South East.
HomeLet chief executive Andy Halstead said it is getting harder for tenants to pay out every month.
“Demand for rental properties massively outweighs supply, which will surely lead to continued price rises across the country,” he adds.
Bidding wars
Rents are surging due to a “toxic combination” of booming demand and dwindling supply, says Sarah Coles, senior personal finance analyst at Hargreaves Lansdown.
“Covid lockdowns persuaded many in shared accommodation to look for a place of their own, while buy-to-let landlords have been squeezed by tax changes, and are considering selling up while prices are still high,” she says.
Other landlords are renting via short-let platforms such as Airbnb, further squeezing availability for people who need a roof over the heads.
“In some areas, tenants are getting drawn into bidding wars, and risk committing to more than they can afford,” Sarah says.
Keeping a lid on your rental costs isn’t easy at times like these, but the following advice might help.
Get your act together early
If you’re searching for a place to rent you need to be on your toes to stand a chance of getting somewhere decent, says Adam Kamani, co-founder of property platform movestreets.com.
Start by registering your interest for new rental properties with local letting agents to get on their mailing list. Then get your paperwork ready.
“A property that may be available in the morning may have been let by the evening, so you can’t hang around,” Adam warns.
Typically, your landlord will want details such as current and past addresses, including start and end dates of tenancies, and contact information for previous landlords.
They may also request a reference from current or past employers, including dates of employment and how much you were paid, and possibly one or two personal references, as well.
Pull together anything else that shows you have a good track record of paying rent on time, say, a printout of your current or previous rent account, or even bank statements showing you have paid consistently every month.
Do your sums
You also need to calculate how much you can afford to pay each month, remembering other bills on top, such as gas, electricity, water and council tax. Ask the agency, landlord or previous tenant to give you estimates for bills before you sign up.
Also factor in ongoing household costs, such as your TV licence, landline and broadband, digital TV subscriptions and contents insurance.
Then there’s your mobile, food and clothes, travel, childcare, gym and any debt repayments, all of which are rising rapidly at the moment.
Sarah Coles says: “You really don’t want to risk falling behind on your rent or getting into debt because you forgot to factor in one of your regular monthly payments.”
Upfront costs
Another challenge is paying upfront costs such as a rental deposit, advanced rent payments and your own removal fees.
With money so tight, many are struggling to fund these extra bills, even if they earn enough to pay their ongoing rent.
More than half turned to family and friends, an overdraft, credit card or payday loans, or spent less on essentials such as food and clothes, according to research from landlord and tenant insurer Husmus.
Chief executive Sarah Werner says the Government is now promising a new lifetime deposit scheme for renters, a move she welcomes.
“If this is introduced, tenants will see their hard-earned deposits move with them from property to property,” she says.
Your tenancy deposit should be no more than five weeks’ rent, in England and Wales, and must be held in a deposit protection scheme. This means if there’s no damage, you should get it back when you move out.
If you don’t have the money for a deposit, the Government website moneyhelper.org.uk recommends asking your local council to find out whether there are rent deposit, bond or rent-guarantee schemes in your area to help you. But not every landlord will accept deposits in this form.
Letting agents and private landlords in England are now banned from charging administration fees for things such as checking references or renewing a tenancy.
Know your rights
It is vital you understand your rights when renting a property.
“This could help you avoid unnecessary costs and potentially save hundreds of pounds,” says Dan Whittaker, personal finance expert at credit broker cashlady.com.
When renting a furnished home, all furniture and upholstery provided by a landlord must meet certain standards, he says.
“If they’re shoddy or broken, it’s the landlord’s duty to replace them.”
Every item must also be
‘‘ A property available in the morning may be let by the evening so you can’t wait
fire-resistant or treated with fire retardant coatings.
“This should be detailed on the manufacturer’s label, which legally must be attached to the item. If the label is removed or does not indicate that the furniture is fire-resistant, the landlord is legally obliged to remove or replace the item,” Dan says.
Your landlord should provide you with a full inventory of all the furniture
and appliances, with notes on the condition. If you spot any marks, tears, stains, scratches and broken appliances, even if quite minor, amend the inventory and send it back to your landlord right away.
“If you fail to highlight these at the start of your tenancy, your landlord may charge you for the damages when you move out,” Dan says.
Consider sending photos to your landlord and keeping copies too.
Dan says never pay for something that isn’t your responsibility to fix.
“If your washing machine, boiler or kitchen appliances break, should you pay for someone to fix it yourself ? The answer is a firm ‘no’.”
Your landlord is also responsible for repairing permanent elements such as walls, the roof, drains, windows, doors, bathroom fittings, wiring, boilers, radiators and fitted heaters. They cannot charge you.
As well as rights, you also have responsibilities, and could lose money if you fail to uphold them.
“Go through your contract with a fine-tooth comb. Some landlords may insist you take out contents insurance or replace certain items when you leave. If you fail to comply, this could cost you,” Dan warns
If you have any questions about your contract, Citizens Advice may be able to offer advice.
Get insured
Almost half of all renters do not have contents insurance in place to cover their personal possessions. And, worryingly, it is coming further down the list of priorities as the cost of living rises.
Yet more than half of renters have had items worth £200 or more lost, stolen or damaged.
One in five wrongly believes their landlord’s home insurance policy covers their personal belongings, such as their mobile phone, tablet, wallet and bicycle.
However, that type of insurance only covers the building itself, any necessary repairs, and the landlord’s own contents, says Alex Hasty, director of trading at comparethemarket.com.
“Going without cover could be costly, should these items unfortunately be misplaced, stolen or damaged,” he adds.