Comments on: Total Cost of Renting

By: Brenda

Brenda — Thu, 18 Jun 2009 17:47:29 +0000

BEFORE moving anything in to the new place you should take photos. Take a tour with the landlord/manager documenting every flaw. Get close ups of any dings or tears in floors, carpets, walls, or appliances. Be systematic. This gives you proof when you leave.

By: Greg

Greg — Wed, 10 Dec 2008 15:01:44 +0000

If you have kids, changing schools and school districts is not good.

By: poor boomer

poor boomer — Wed, 10 Dec 2008 04:47:31 +0000

If you are in a position to buy a home, there are added considerations in the form of opportunity costs of NOT buying.

For example, if you have $20K for a downpayment, the gross opportunity cost of NOT buying is the annual rate of appreciation of area homes, In this case, you also benefit by NOT buying, since you have $20K with which you can enjoy financial gains. Perhaps you keep $5K in a liquid (e.g. money market account), and invest the remaining $15K for higher yield. By subtracting your investment gains from your gross opportunity cost, you reach a net opportunity cost (which at times will be negative) of not buying a home. (Basically, if your investment rate of return exceeds the rate at which homes are appreciating, it may be better to rent than to own. Conditions change, and at other times it will be better to own than to rent.)

In some cases – some areas, in some locations, at some times – your ‘net opportunity cost of not owning a home’ may be negative

By: Jim

Jim — Tue, 09 Dec 2008 18:14:48 +0000

I totally agree that there are bad landlords out there. Renters should educate themselves on the law and read the lease carefully.

But there are many good landlords. I rented 4 places in a 8 year period and 3 of the landlords were great. One landlord failed to fix a plumbing problem and thats the only real complaint I had.
My father has been a landlord for decades. He has been a good landlord. Through his experiences I’ve seen dozens of horror stories of bad renters.

People are people. Renters or landlords are just people and some of them are good people and some are not.

Jim

By: Jim

Jim — Tue, 09 Dec 2008 18:09:45 +0000

Miss M “My last landlords weren’t as bad though they did lie about the cleaning thing, said my place was professionally cleaned before I moved in (it wasn’t) and that I had to pay to have it professionally cleaned.”

That sounds to me like you went into the rental agreement knowing the conditions. If you thought the landlords were liars then why did you still rent from them? Did you agree to have it professionally cleaned when you moved out as part of the lease? It sounds like they required it. If its in the lease then you agreed to it. If you don’t want to agree to something in the lease terms then rent somewhere else.

Jim @ Freeby50

By: Scott

Scott — Tue, 09 Dec 2008 13:46:10 +0000

Rentlaw.com is a great resource if you need to take up a legal battle with your landlord. When my wife moved out of her place we had to threaten legal action against the landlord to get her final $50 back. The property manager checked her out of the house and said all looked ok but then withheld $50 for repairs when they gave the deposit back. In Virginia, landlords have 30 days to give you a detailed list of needed repairs otherwise you get your full deposit back (she never got a list and didn’t even hear from the property manager until well after 30 days). And if they give you a list you still have 15 days to get the repairs done yourself before they can legally take out some of your deposit money. The only hairy part for us was her landlord was active duty military which according to the lawyer we talked to means the laws are more vague concerning timely deposit returns and such… so beware.

By: Andy @ Retire at 40

Andy @ Retire at 40 — Tue, 09 Dec 2008 10:45:39 +0000

You mentioned that you didn’t like moving every year and I agree, it’s a complete pain. One of the factors you didn’t add was the actual cost of moving which is actually a significant amount of money. Here are some things to consider:

* hiring a truck or a moving company
* payment to disconnect any services you’d originally signed up for too long for
* connection fees for any utilities and/or internet at the new house

I have found that these things can add up to a fair amount in some cases.

By: Donna Freedman

Donna Freedman — Tue, 09 Dec 2008 01:56:28 +0000

Proximity to shopping is important. If the nearest supermarket is a long, long drive then you’ll probably buy stuff at neighborhood and/or convenience stores and spend more than you need to spend. Since such markets don’t always have everything you need to cook with, you may also spend more money than you’d expected on takeout.

By: Andrew B

Andrew B — Tue, 09 Dec 2008 00:22:13 +0000

In many places like the Bay Area, the commute costs typically are higher for home buyers if they choose to live in the more affordable burbs. One of the reasons to rent is to be closer to your job and reduce commute costs. You can live in a better neighborhood (higher priced real estate) renting, too. Depends on your town of course. Not sure how to quantify that benefit…Good topic, though. Most of the costs you highlight can apply as “hidden” to buyers as well.

By: Eric N.

Eric N. — Mon, 08 Dec 2008 23:38:19 +0000

For some reason you always provide the most timely posts for me Jim. haha. Anyhow, starting some time next year I’ll be renting an apartment for the first time and have felt a little unsure on what to look for. I asked others who live on apartments but they didn’t provide as good an answer as your post. Definitely bookmarking this for the future. Thanks!

By: Miss M

Miss M — Mon, 08 Dec 2008 23:27:10 +0000

Parking is a huge consideration in LA, a lot of older apts do not have parking. My friends rent in one such building, they paid an extra $60 a month to park in a nearby office building. They could only park there from 7pm to 7am! When their cars were parked on the street at night they kept getting broken into. They paid a pretty high price for not having parking. Another consideration is storage room. My mom just went from a house to an apt (divorce) and was deciding between a smaller apt and renting a storage unit or just renting a larger apt. She chose the latter and has the 2nd bedroom stacked to the ceiling with boxes.

@Commenter Jim – I’ve been ripped off by an unscrupulous landlord. Look up Arnell Management in Orange County, the state atty general has had to go after them several times. I had to file suit to get my deposit back, they are bad bad people. My last landlords weren’t as bad though they did lie about the cleaning thing, said my place was professionally cleaned before I moved in (it wasn’t) and that I had to pay to have it professionally cleaned. I scrubbed for a week till the place sparkled and they still charged me.

By: Jim

Jim — Mon, 08 Dec 2008 21:56:51 +0000

There are some bad landlords out there but they aren’t all out to cheat tenants. There are many bad renters out there which are the reason why good landlords have leases with rules and things like deposits.

Frankly if someone has a security deposit and lease that requires cleaning (as most do) then the tenant is responsible to clean before leaving. Thats the contract. If they don’t clean then they are legally responsible to pay the cleaning expense. If someone “forgets” to vacuum then they probably also forgot to clean the tub, clean the fridge, clean the oven, etc. You really can’t rent out a filthy apartment and cleaning all that stuff costs money. I would NEVER rent an apartment without the requirement that the tenant clean before leaving. Not requiring cleaning is an invitation for renters to trash a place. And trust me there are many renters who will take that invitation. Most renters can be trusted not to do so but theres always people who will abuse a situation.