Moving Out Of Home and General Advice on Renting

Revision as of 22:16, 2 January 2008

Leaving home for the first time is a complicated and expensive matter. There is surprisingly little detailed information on the subject. This Wiki guide is an extensive amalgamation of knowledge to help you consider everything you may face when moving out. All figures are based on city living within Australia, so you may have to make adjustments if you live elsewhere. It is split into 3 main sections.

General Knowledge

Location

Finding a Property

Many people are now finding property to rent or buy on the Internet. There are many RealEstate websites, which allow you to cull properties based on your needs. You may find the popular properties go very quickly, sometimes even a day or so after they are listed. If you see a place you really like, make sure you call the agent straight away, and organise a time to inspect the property. Agents should generally not be trusted, and obviously do not have your interests in mind. They are trying to get the best tenants, to pay the highest price, in the shortest amount of time.

Applying for a property

It is usually a lot harder for a single guy to apply for a property than a couple. So if you are moving out on your own, try and bring someone that can act as your partner. They don't necessarily have to sign the lease, but it will increase your odds at getting a place. You will probably be one of many people inspecting a property to rent. You need to distinguish yourself over the other applicants - or, more correctly, you need to avoid distinguishing youself as an unattractive applicant. From the point of view of a landlord, here are a few tips to make yourself a more attractive tenant candidate:

• First impressions count. If you are inspecting a property, wear clean clothes, be polite, ask permission to look around and take your shoes off at the door. The agent will be assessing you and will see how you behave during the inspection as an indicator of how you will behave as a tenant.

• Landlords want two things in a tenant: Prompt rent payment and care for the property. Anything you can do to reassure the agent/landlord that you will be exemplary in those two qualities will help you.

• Don't mess around with the application if you like the place. Fill it out on the spot and hand it to the agent or landlord personally if possible, or hand it in as soon as possible (e.g. at 9am Monday morning if you inspect on the weekend). Have all your paperwork ready to go. Fill it out neatly.

• It's sexist, but it's true: landlords expect females to care for a property better than males. If you plan to share, consider the fact that an application from four blokes will not be competitive compared to one with some girls in it, all other things being equal.

• The following criteria are seen as positive by landlords: established couples, established jobs/careers, long term rent history, desire for a long (6mth +) lease.

• The following criteria are negatives: large groups of singles (particularly males), students, unemployed, no rental history or a history of short tenancies, applications for short leases.

Inspecting a property

Properties are generally inspected in one of three ways:

• Keys in office is exactly as it sounds: the keys to the property can be picked up from the agent that has them. You will need to show some ID, and normally leave a $50 deposit. The keys will often go out quite regularly on the weekend, so it always pays to ring the agent first, especially if the agent is some distance from the property.
• Open for inspection is also exactly as it sounds. These normally occurs on the weekend (occasionally on a weeknight), and it will only be open for about 15 minutes, unlike for sale inspections. The times which properties are open for inspection are normally listed on the real estate websites, but may not be added until a day or two before the inspection. In my experience there are normally a few other people at these kinds of inspections.
• Inspect by appointment means you need to call the agent to arrange a time to inspect. The agent will meet you at the property and show you around. If you are late you appear as unreliable and will not be considered. If you are earlier than about 5 minutes you risk appearing too keen.

Housemates

The Good

Moving in with one or more other people can cut costs significantly. By splitting costs, you can save on many ongoing costs such as electricity and food. You can also split furnishing and appliance costs if you wish, but keep tabs on who owns what.

The Bad

Screen your potential flat mates carefully. Avoid moving in with close friends as you will often end up hating them. If posible secure the lease by yourself and move in, then you have the power to control who your flatmates are and how they live in the appartment.

Important considerations

Respect their space. Clean up after yourself. Get agreements such as lent money, spotting the rent for someone else, even a cleaning roster written on paper. Unfortunately gentleman's agreements can fall through and bite you later on. This is especially true if you're moving in with strangers. Try to agree on a list of basic rules to follow, like rules on parties and entertaining for example.

Logistics

Mail

Depending on your move and how this has come about, you might want to redirect your mail to your new address. It isn't overly expensive at about $23 for three months for a domestic redirection.

Utilities

Try an organise your internet, gas and electricity to be connected the day *before* you plan to move in, as the connection could occur any time during the day, which may be a major pain.

Legal

This brief section should not be taken as legal advice. Laws may vary from state to state. "A tenancy agreement can be written, verbal or even implied, it does not need to be in writing to be binding."[1]

Your responsibilities

As the tenant of someone elses property, you are obliged by law to:

• Pay the rent on time; [2]
• Keep the premises clean; [3]
• Notify the Landlord or Estate Agent of any damage caused by a tenant or guest (It is likely that you will need to cover the cost of repairing any damage); [4]
• Notify the Landlord or Estate Agent when repairs are needed; [5]
• Abide by the requirements of the Residential Tenancies Act 1995; [6]
• Not make any alterations or add fittings to the premises (including picture hooks, shelves, fences & gates) without the Landlord's permission; [7]
• Not interfere with the peace and privacy of neighbours; [8]
• Pay for water charges as per your agreement or in the absence of an agreement, pay for the amount of water used in excess of 136 kilolitres per year; and [9]
• Not use the premises for any illegal purposes. [10]

Landlords Responsibilities

Landlords, property owners and real estate agents must comply with the Residential Tenancies Act. The Landlord is responsible for:[11]

• Notifying the tenant of their name and address; [12]
• Providing the premises in a clean and reasonable state; [13]
• Maintaining and repairing the premises; [14]
• Respecting the tenant's right to privacy, peace and quiet afforded to any homeowner; [15]
• Lodging the security bond within seven days (or 28 days if through a registered Estate Agent); [16]
• Completing and providing two signed inspection sheets and an information brochure at the commencement of the tenancy;
• Providing and maintaining locks; [17]
• Paying council rates and land taxes; [18]
• Paying for water charges as per your agreement or in the absence of an agreement, as set out in the Residential Tenancies Act 1995; and [19]
• Keeping records of the rent received and providing proper receipts for any money received from the tenant.[20]

Breaking a fixed term lease

If you sign on for a 6, 12 or 24 month contract and wish to move out prior to the contract expiring you will be liable for a number of charges. The following is a basic summary of what charges you could be charged under the Act. Note that the following can change depending on the State you live in and the agreement with the Landlord and the Realestate agent.

The owner of the property has a right to recover compensation from you as set out in sections 210 and 211 of the Residential Tenancies Act 1997.

If you do vacate the property prior to the expiration of the fixed term tenancy agreement, you will be responsible for the following compensation costs: -

  1. Rent up until the date that there is another tenancy agreement entered into for the property; the existing tenancy agreement is 
assigned to another party; or at the expiry of the tenancy agreement into which you entered – whichever comes first.

  2. Advertising costs in proportion to the unexpired period of your tenancy agreement.
         * This includes local newspaper listings and internet listings. Costs can range from $50 to over $100.
  3. A letting fee proportion to the unexpired period of your tenancy agreement.
         * The letting fee is usually 5% plus GST of the average annual rent (as an example for a property at $250 per week:
 $250 X 52 X 5.5% = $715)
         * If it is a 12 month tenancy agreement and 8 months has expired, the responsibility would be 4/12ths of the letting fee being $238.33
  4. Tenancy application checks on all prospective tenants through the National Tenant Database of Australia.
         * The amount charged for this service is $12.00 for each tenant application
  5. The erection and removal of a For Lease board.

All fees will be finalised and advised to you once a suitable tenant has been secured.

As stated in the above, you need to continue paying your rent calendar monthly in advance as it is an offence under section 428 of the Act attracting 10 penalty units for a tenant to use the bond, or any part of the bond as rent.

If another tenancy agreement is entered into or the existing agreement is assigned and your rent is paid beyond the commencement date of the new tenancy, any overpaid rent will be fully refunded to you.

It is recommended that you speak with your Realestate agent prior to putting in your notice to leave to understand what costs you may be liable for.

Initial expenses

Appliances

Furniture

Other

Ongoing expenses

Rent

Utilities

Services

Insurance and Security

Transport

Other and Variable