Renting is a big deal in the UK. Millions of people in the country are renting their properties, including nearly half of people aged 25-34, and the majority of people living in London. Tenants are paying more rent each year, with many spending over half their salaries on rent. Compare this to the situation in 2000, when the majority of people owned their own house, including households with mortgages. The private renting landscape in the years since, especially in our capital (which was deemed “a city of renters” by The Telegraph in 2016), has been one of scarcity and competition.
Given the current state of renting across the country, tenants are ever-more desperate to sign, often rushing into tenancy agreements without taking the necessary measures beforehand. However, the pressure of renting gives you no excuse to be reckless about the whole process – if anything, it gives you more reason to exercise caution and avoid the most common mistakes. Which begs the all-important question: what are some of the renting mistakes that tenants often make? And how can renters avoid rushing into tenancies that cause them more harm than good?
Note: this article is a follow-up to our precious article on common property investment mistakes. We see a lot of mistakes among landlords and tenants alike, but we are here to correct them!
Not reading the tenancy agreement
Reading 40 pages of cold technical writing is not an ideal way to spend a Saturday afternoon – we’ll admit that much. But the importance of carefully reading through your tenancy agreement can’t be stressed enough. In fact, maybe it can: read your tenancy agreement before signing it! There you go… That wasn’t hard was it?
A lot of UK tenants simply assume that all rental contracts are more or less the same document, each with slightly different ways of saying the same thing. But this is a big misunderstanding. Each landlord has different requirements, some of which you may find undesirable or unfair. Now, you wouldn’t just assume that a property did not have a massive gaping hole in the ceiling – you’d check out the condition of the place beforehand. So why take the same approach with other potential deal breakers such as rent increase clauses and unreasonable obligations?
Tenants need to gain a full understanding of what their obligations will be during the tenancy, what rules and conditions they will be required to follow, what they are entitled to in the terms, and they need to understand these things before they put pen to paper. Yes, it may be boring, but this can only be achieved by reading the tenancy agreement back to front, top to bottom. Spend at least half an hour with it and discuss the document with any housemates.
Not doing the maths
As we’ve already established, the cost of renting property in the UK is increasing year on year, making it more important for tenants determine a reliable budget when looking for a new rental – this means figuring out the maximum you are willing to pay on your rent and bills per month, accounting for any fees and upfront costs, as well as saving up for your deposit down payment. Don’t simply assume the same budget as last time you rented. Being a tenant is a volatile affair, and the overall quality of properties that fall under a certain rent bracket is subject to change. The last thing you want is to find yourself unable to meet your monthly bills and rent payments, so doing your homework could pay serious dividends.
Of course, figuring out an appropriate budget for your rental is not always easy. In summary, tenants will need to track their monthly outgoings in order to come up with an accurate budget. This process will also require you to decide how much disposable income you would prefer to have left once you’ve paid your rent. Seek a financial advisor if you must! Just remember,
the goal is to come up with a ballpark figure determining how much rent you are able to pay (with around £20 leeway both ways), as well as how much you can can afford to put into ongoing costs like utility bills, council tax, and insurance payments.
Once you have a budget, it’s time to look for houses in that fit the bill and sign for the best offer. If you’re renting with others, this is the point at which you have conversations about how best to split the rent payments between each tenant. Splitting them evenly is the most common option, but some decide on different rents for different tenants on the basis of their salaries or rooms. Whatever you decide, get confirmation from each tenant that they are happy with the rent split, and tell your landlord so they can put it down in writing and set up the necessary direct debits.
Not conducting enough research
Doing plenty of research is rule numero uno when seeking out your perfect rental property, and failing to do so could land you in troubled waters – this is not just a roof above your head, but a living space in which you should feel comfortable and happy on a daily basis. Ultimately, renters should be aiming to secure a property that matches the majority of their requirements (although a little bit of compromise is understandable). With the entire internet at your fingertips, nothing is stopping you from browsing estate agent lettings and getting the ball rolling right now! But first, here are some of the main factors to focus on when conducting your research:
- Local area. You’re not just buying an individual property but also the surrounding area. You will most likely have an intuitive idea of what you want your new local area to offer – you may even have a particular neighbourhood or borough in mind. But without visiting, you cannot truly get a feel for the area and its individual qualities. In the worst case, tenants could end up in an area with no local amenities and high crime rates, underperforming schools and unwelcoming neighbours. But by doing enough research, you might just dodge a bullet and discover these issues before you sign the dotted line.
- Condition of the property. Unfortunately, many properties in the private rented sector are not in a reasonable condition and many have problems with health and safety. Without thoroughly assessing the condition of the property during your initial viewing, you could end up being on the receiving end of certain hazards months down the line. Perform basic checks by looking for damp or mould, cracks in walls, exposed wiring, leaky plumbing, and ask the landlord to see the gas safety certificate for the property. Finally, always check to see if there are smoke alarms and carbon monoxide detectors.
- Travel: Even if a property ticks all the boxes and falls within your budget, it may not be practical in terms of its location and accessibility. Parking might be lacking; public transport could be far removed; your commute to work and back could too long – you will never know until you travel to the property and get a feel for its location.
For more help with researching potential properties, read of our previous article outlining exactly what you should be looking out for during a house viewing. Believe us, it is worth the hassle!
Not taking precautions upon moving in
So you have made the big move. You did you research and you are satisfied with the house; you budgeted well and the rental costs are manageable; you even read the tenancy agreement – but you’re still not in the clear, and there is still room to make mistakes if you’re not careful. Ask yourself: are you taking the right precautions upon moving into your new rental property?
The first potential mistake is forgetting (or neglecting) to take your own inventory of the property, which can in turn lead to the loss of your security deposit for damages that you did not cause. When you move into any property, there is a chance that certain flaws will already exist therein – from broken fixtures to cracked tiles to damp ceilings. Without evidence of these existing flaws, each documented and photographed as soon as you move in, your landlord could technically charge you for damages that you didn’t actually cause. Avoid the unnecessary he-said-she-said, either by providing another set of eyes at the landlord’s arranged inventory check at the start, or undertaking your own inventory and getting it signed by the landlord within the first week. Read our blog post on keeping your security deposit without disputes for more tips!
Secondly, it might be worth taking out your own insurance policies once you have moved in. Generally, landlord insurance policies do not cover the personal property of tenants. As a result, in the event of a burglary or a fire, you cannot rely on your landlord’s insurance to cover the cost of any damaged or stolen belongings – this requires you to get contents insurance of your own. Start looking into premiums when you move in, and make sure to budget for the monthly costs (usually just over £10 a month, depending on the overall cost of your contents as a whole).
If you’re looking to rent a beautiful property within the best boroughs of South West London, take a look at the lettings we have available here at James Anderson.