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Looking for a home? 5 rent-related recommendations

18.08.2022

Looking for a home? 5 rent-related recommendations

The end of summer and the beginning of autumn is an active period on the rental market. Demand has been very high this year for many months now, but the approaching period will amplify it even more. Lia Siht, Rendin’s Head of Legal and Compliance and lawyer, shares advice on what to consider when looking for a rental home.

1. Plan your budget related to renting: monthly rent and utilities

Get acquainted with the offers on the rental market, think about your needs and set a budget within which the future rental home should stay. "It is important to ensure that a person has a balance between their income and their expenses. The amount of rent and utility bills should definitely not exceed half of one month’s expenses (60% in extreme cases," explains Lia Siht from Rendin, which is a solution for renting (out) homes and concluding secure agreements.

Since utility bills may vary significantly between living spaces, getting acquainted with the rental home’s previous bills is always recommended, which would reflect both the summer and winter seasons. These sums may be utterly different to what a person has been used to in the best, be it in a good or bad sense.

In addition to the heating solution, it is necessary to ask about the electricity services (fixed or exchange price-based package). This way, you can better plan your budget and consider when you could avoid higher electricity consumption, etc.

2. Have spare money for the unexpected

"Considering the living conditions, where all kinds of prices are rising very quickly, the inflation rate is high, and the steep heating costs of autumn and winter are still ahead, it is recommended to keep some cash reserves to make ends meet," points out the legal expert. However, she adds that people should be prepared for surprising prices that might take a toll on their wallets.

3. Identify one-time costs: deposit, agent fee and contract fee

In the phase of looking for a rental home, it is always good to carefully monitor the starter costs of renting in addition to the first rent payment. For example, is the rental with or without a deposit? Is there an additional brokerage or agreement fee?

A one-time outlay when moving in can vary greatly. Let us take an example where the rent of an apartment is 550 euros. If renting without a deposit is offered, the starter costs may be limited only to paying the first rent. However, if additional one-time fees are added when moving in, then in such a situation, the tenant’s expense might reach 1,650 euros (one month’s rent, a deposit equal to one month’s rent, and a brokerage fee). At the same time, if the deposit is requested for three months, the tenant should consider expenditure of 2,750 euros.

4. Stand out among other potential tenants: introduce yourself and share your plans

The current period is very active in the rental market. "For several months now, we have seen the demand level being several times higher than the supply. This means that landlords must deal with a large flow of rental candidates – they need to actively communicate with prospective tenants, answer their questions, and schedule showings. Usually, the number of candidates is around 30–40 for one rental home. However, in today’s situation, it is no longer remarkable to have around 100 candidates," says Rendin’s Head of Legal and Compliance and lawyer.

In other words, someone looking for a home should not be discouraged if they do not receive feedback quickly or at all. It is always worth keeping several options on the table, not just betting on one.

Lia Siht recommends that the best way to stand out from competing rental candidates is to invest more in presenting yourself. Sharing a resume with a landlord is an excellent opportunity to make the first introduction and build credibility. What to include in it? "A brief overview of yourself and what you do (education, profession, hobbies, etc.), with whom you plan to live in the rental apartment, why you are interested in the living space and the area and how long you plan to live in the particular space," she points out possible talking points.

5. Be familiar with the contents of your rental agreement

Once you have chosen your place to live and the time comes to enter into an agreement, then at this stage, it is crucial to familiarize yourself with the agreement and its contents. The contract must follow the Law of Obligations Act (it regulates tenancy relations) and be fair to both parties.

So what to watch out for?

  • Read the entire rental agreement carefully before signing. You should not be afraid to ask if something needs clarification or an explanation.

  • Check the type of rental agreement you have – if it is fixed-term or termless- and the conditions for terminating the contract.

  • It is essential to record all activities related to renting correctly. This applies to the agreement, the handover-acceptance act, and the payment data.

  • Determine what is written in the agreement on various payment obligations, firstly, whether the rent is paid by transfer or cash. In case of payment in cash, the tenant must receive a written confirmation from the landlord for each charge. Secondly, how is the payment of utility bills arranged: directly to the service provider or based on an invoice to the landlord? And what are the payment deadlines?

  • Clarify your more general rights: who else can you accommodate in the apartment, is it possible to replace (old) pieces of furniture and if you can hang pictures on the walls? All agreements of this form must exist in writing, i.e., in a format that allows reproduction.

  • Check what the contract says about natural wear and tear – does the landlord accept natural wear and tear or have they stipulated that the accommodation must be returned in a condition where wear and tear/deterioration caused by regular contractual use is eliminated? This is one clause in the Rent Act (the Law of Obligations Act, or VÕS), which came into force in 2021.