Affording a place to live

Finding a Place to Live    

Moving to a new apartment can be really exciting.  It is a place to decorate the way you want, to host your friends, and to call home. Think about what your ideal apartment looks like:

• How big is it and what is the layout?  
• What is the building like and what does it include?  
• Is it in a particular neighborhood? What is neighborhood like?
• What amenities are included?

At the same time, you’ll need to consider your finances.  You want to find an apartment that matches your wish list and is also affordable.  Start by identifying what you need or “must have.” This can help you prioritize one apartment over another.  Then you will need to identify an amount that you can afford every month. This analysis will help you find a suitable apartment without breaking your budget.  Ask yourself:

• How much can you afford in monthly rent?   Try to spend below 30% of your income on housing—rent and utilities.
• Can you afford to provide a security deposit if one is required?   
• Do you plan to live there long enough to commit to a lease?
• Are you prepared financially if something goes wrong and you do not have regular income for a period of time?

Finally, remember when you submit a rental application, not only are you looking at the apartment, but the landlord is taking a close look at you too.  They have the right to consider and reject your rental application if:

• You have poor references from previous landlords.
• You have poor credit report and/or low credit scores.
• You have insufficient income to pay the rent on an ongoing basis.
• You have pets or smoke and those are prohibited.
• You have a criminal record.  But, the landlord must have a policy that takes into consideration what the crime was and when it happened, as well as other factors.  Barring you just because you have a criminal record could be considered discrimination.  If you think you may have been discriminated against, contact your regional HUD office.
• You have had an eviction lawsuit.

How to Find Safe, Stable and Affordable Housing    

Finding rental housing that meets all of you expectations and is also affordable can be a challenge.  And depending on where you live, it can be very difficult. In a large city, a town with a university, or a town with a shortage of rental housing, prices may be very high.

While having amenities is nice, your first priority should be to obtain housing that is safe, stable, and within your budget. There are two general considerations for safety:

• Is the housing located in a neighborhood that is comfortable and safe for you?  Is the crime rate relatively low?  Is there good lighting at night?  Do neighbors seem to watch out for one another?
• Is the apartment building or house safe?  If an apartment, does it have proper fire exits, smoke alarms, and/or a sprinkler system? Overall, is it in good repair?

Stability and affordability should go together when you are looking for a place to live. The most common reason people move is that they can no longer afford the rent or mortgage.  While the cost of housing is highly dependent on the local housing market, a good threshold is to pay no more than 30 percent of your gross monthly income towards housing costs (rent plus utilities). This means if you earn $10 per hour for full time work (or $1,600 gross per month), you should spend no more than $480 for your housing. Again, this may not be possible in your community. If this is the case, you may need to explore other options for covering the rent, such as additional sources of income or reducing your monthly housing costs. You may need to live with roommates or rent a room in another person’s apartment or home.

The Basics of Rental Agreements    

Some tenants make verbal agreements with landlords. A written contract, commonly called a lease, will give you more protection.  

Leases and rental agreements tend to be boilerplate contracts that are written to protect the legal rights of the landlord.  It is up to you to read the contract before you sign it so you understand your rights and responsibilities. This is also a time to ask questions that could lead to changes in the agreement that protect you. While some rental markets are flexible and landlords are more willing to work with tenants, other rental markets with lower housing stock favor landlords. This may make it harder to negotiate changes to the lease or rental agreement. They know that if you walk away, there will be another person to fill your space.

Be sure to read everything and ask questions! This will go a long way in protecting your rights when you rent.