What is renting? –
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Introduction 👋
Renting is where you pay to use something valuable, like a car or house, for a specified period of time.
You can rent anything from a boat to your everyday necessities like clothes.
Renting a home 🔑🏠
Renting is commonly used to talk about paying to live in a house that somebody else owns.
If you rent a place to live, you are known as a “tenant”.
The person who owns the house you’re renting is called your “landlord”.
Very often a landlord will pay a business called a “letting agent” or “estate agent” to manage the home and collect your rent money off you.
Renting a home vs buying – what’s the difference? 🤷♀️
Here are some of the main differences between renting and buying a home.
Who owns the home 📜
Renting = your landlord owns the home
Buying = you own the home
Flexibility moving home 📦🚗
Renting = sometimes more flexible to move home because you don’t have to sell the house before you move
Buying = sometimes less flexible to move home because you often have to go through the effort of selling the home before you move
Bills 💸
Renting = sometimes your landlord can include the bill costs e.g. electricity, water, in your monthly rental costs. This can make life easier because you don’t have to worry about bills.
Buying = usually when you buy a home, you have to organize all the bill payments e.g. electricity, water, yourself.
Deposits 💰
Renting = On top of what you can pay each month, you need to look at how much you can pay towards a “deposit” for the home.
A deposit is sort of like a safety net for the landlord, in case the house gets damaged. 🥅
It’s a chunk of money that:
- you pay at the start of renting 💳
- the landlord looks after, whilst you live at the home 🔒
- gets given back to you at the end of renting, when you move out 💸
If you damage the landlord’s home, they might refuse to give your deposit back to you, and use your deposit money to repair the damage.
When you rent a home, you usually have to pay 1 month of rent as a deposit to your landlord for them to hold onto.
For example – if the rent costs £500 per month, I would have to pay a £500 deposit and my first month of rent (£500). This means that I would have to pay £1,000 for my first month of renting.
As long as you haven’t damaged the house, your deposit should be given back to you when you move out. 🔁
If you live in the UK your landlord should put your deposit money into a secure “tenancy deposit scheme” whilst you’re living there, instead of keeping the money in their bank account.
Buying = people usually borrow money to buy a house. This loan is called a mortgage. When you get a mortgage, you have to pay a chunk of money towards the house called a deposit.
This deposit amount could be as low as 5% of the sale price of the house, or it could be really high like 50% of the house price, depending on the loan you want.
If you were buying a house for £100,000 with a 5% deposit, you would need to pay £5,000 as a deposit.
When you buy a home your deposit money doesn’t get paid back to you because it buys you part of the home.
The deposit for buying a home can be more expensive than the deposit for renting a home.
Where can I find a home to rent? 🔎
You can find a home to rent by:
- Looking at property websites e.g.
Zoopla (UK) https://www.zoopla.co.uk
Zillow (USA) https://www.zillow.com
- Checking newspaper listings
- Looking for “to let” signs in your local neighbourhood
- Joining social media groups to look for listings
- Asking friends and family
Be very careful when dealing with online adverts for rental homes – they can be scams!
Make sure to check that any home you look to rent is from a legitimate person/organisation.
Conclusion 👍
So that’s it!
Hopefully you’re feeling more confident about renting.
If you know any friends or family members who might benefit from learning about rent, share this post with them!
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