Experts suggest potential homebuyers should snatch up cheap homes at low interest rates now – and that's fine if you have the cash. But there are plenty of great rentals seeking tenants for low rents right now, if you know how to look.
The rate of home ownership fell last year to the lowest it’s been since the Great Depression – 65 percent, according to the U.S. Census Bureau. Some real estate experts are suggesting now’s a better time to buy than rent a home (in most places) to save money in the long run.
But this summer, The Wall Street Journal pointed out developers are building a lot of apartments. And Money Talks News founder Stacy Johnson addressed the rent vs. own question himself back in April, arguing that the best answer depends on factors that the experts don’t always consider. He concluded: “There’s no shame in renting.”
I’m glad Stacy said that. As a grad student with loans and an immigrant wife working retail, renting is our only option right now.
Of course, it’s not such a bad option once you learn how to look. Just last month, we moved into a studio literally a block from the Atlantic Ocean, with utilities included, for $800 a month – pretty good for my neck of Florida. Here’s how I found our new place, along with some other renting advice based on my recent experiences…
1. Set priorities
Some people start off expecting a certain amount of space, a fixed number of rooms, or specific amenities. Setting boundaries is a good idea and helps narrow down the options, but the primary concern for us was price. We focused on how far we would have to drive to and from our usual haunts and what was included with the rent: Water? Electric? Trash? Cable? Internet? Parking spaces?
We also looked at what wasn’t included – some places had offers like first or last month free. Deposits varied widely, from half a month’s rent, to two months’ rent, to “We’ll tell you after the $50 credit check you pay for.”
Some places charged pet fees of several hundred dollars and banned certain animals or breeds, while others didn’t care and had no extra fees. (We have a cat.) Knowing whether the cost to move in was triple the regular rent seemed a lot more important than whether I got a walk-in closet or access to a pool and gym. You really can’t make a straight comparison between apartments until you tally the total cost.
2. Search online – and offline
We started by looking around online (on Craigslist, Rent.com, and Apartments.com) thinking that the Internet would be the place for the most current listings. Ha! There were some good leads and a lot of criteria to play with. But we quickly realized that not everyone lists online, and some that do are lying – or they were really lazy.
A lot of search results turned out to list inaccurate rent ranges, outdated phone numbers, or office addresses instead of the property’s (without any photos, either). So we started looking offline – at the newspaper classifieds and the bulky apartment guide that’s published bimonthly here. The latter has a website, ForRent.com, with the same issues. Some of the prices listed online didn’t match what was in print, and we realized the latter was more current.
3. Ask around
When you let friends and family know you’re looking, you might hear some options you won’t find any other way. Word of mouth is still powerful in the digital age: It’s actually how we got our current place. The landlord of a friend of my mom’s was looking for a tenant who could move in immediately, and while there was a sign out front, the property wasn’t listed anywhere – not unusual with small landlords.
4. Be prepared
One of the advantages of renting from a smaller operation instead of the company that owns half the town is flexibility. When it came time to sign the lease, my landlord wanted proof of income, but he didn’t care about checking credit (so no fee there) and was willing to be flexible on the deposit (which we got to split over two months).
But at some of the other places we toured, leasing agents told me I needed bank statements, tax records, pay stubs, and references, and that my wife and I would have to go through background and credit checks. Some places wanted to charge application fees of up to $50 per person for those.
So it seems having all this stuff in hand would make you stand out as a potential tenant, especially if the landlord isn’t as laid-back as mine. If you want to negotiate – and haggling is always worth a try, especially when you have multiple options – also come with a list of what other properties are charging and what they included. Those online listings or a site like Rentometer.com can help. I got my landlord to throw in free Internet on top of the utilities he was already offering.
It also pays to research rental laws or find a rental handbook for your state. (Here’s one I found for Florida by searching “renter rights florida.”) I learned what sort of stuff is legal in leases, what to be wary of, and how modifying lease clauses I didn’t agree with works. I also found out how much notice I have to give before moving out. Our lease is month-to-month, which means in this state it’s 15 days. That’s also the amount of notice the landlord is required to give before he can jack up the rent – good to know, right?
Once you do move in, look into renter’s insurance. It’s not expensive – about $15 a month – and protects all your stuff in case of a disaster. (Your landlord sure isn’t going to reimburse you.) Learn more about it in 6 Myths about Renter’s Insurance.