What should first-time renters consider before they sign a lease?
- Credit: Nigel Sutton
Considering the recent increases in university tuition fees, rising London house prices and the troubles of getting a job even as a graduate, there is now an accepted societal wisdom that coming out of university may mean another long stint with your parents.
Even for those lucky enough to have accommodating families, however, there comes a point where you crave independence. If you’re planning to live off your first or second job in London – without a significant cash injection from the bank of mum and dad – this will inevitably involve registering with a letting agent as a first time renter.
To avoid becoming a goldmine for greedy agents, it’s crucial to enter the market prepared. As David Cox, managing director of the Association of Residential Letting Agents (ARLA), explains: “Would-be tenants can often find themselves put under a lot of pressure to make a quick decision on a property, provide extensive information and sign numerous documents before their dream home is snapped up by someone else.”
Consequently, the first step is to ensure a letting agent is accredited through a professional body such as the ARLA. “By looking for an accredited letting agent, tenants can rest assured that any issues will be dealt with in a professional and safe manner as their letting agent is required to follow a strict code of conduct.
Having moved to a three bedroom house in Archway last autumn, Matthew Colvin, Tim Arbabzadah and Simon Worthington are recent newcomers to the rental market. All three met while studying at Imperial College London and following spells living together at university, they spent much last summer in an exhaustive search across the capital.
“The main challenge was finding a house where you felt as if you’re getting good value for money,” says 25-year-old Arbabzadah.
“When we were looking we felt a lot of places were expensive but not that great and you were paying for the area – we saw a few places in Clapham and Earlsfield and they were small and dingy but still very pricey.
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“Also, we all had different budgets which meant we were looking for a house with different sized rooms, otherwise people would resent the difference. Pricing was definitely one of the main factors – it’s a compromise between price, location and quality.”
With the pressure of a fiercely competitive rental market allowing agents to push for a quick deal, compromises can often be made on the latter two. However, Steve Murray, Lettings Manager at Martin & Co. Camden, reveals that if an agent’s hassling you twice a day about a property, “it generally means they don’t have tenants lining up to move in”.
“For young people in particular, I know there are some agents out there who’ll ask for money before they even show them properties,” he adds. “That shouldn’t happen. For a lot of agents, you’re just a number; you want someone who’s going to give you a really nice personal service.”
Compared to living at university, this personal service is crucial when it comes to both location and quality of living. Ideally, Murray says, you should only make an offer subject to a second viewing, but in very busy periods that may not be an option. The impetus in this case therefore falls to the viewers, so one option may be to take videos of the property so that you can discuss them as a group afterwards (See tips opposite).
Another consideration is who to share with. While the three Archway residents had experienced living together at university, even they were surprised by the additional strains working life added to each of their criteria.
Colvin, 24, says: “No matter how much you might get along as a group, this is always going to be the most divisive question. Personally, I’d say that transport links are my deal-breaker - I’d rather not have an uphill forty minute walk to a bus stop in the morning.”
“Transport links were key for me too,” Worthington, 24, agrees. “I was also pretty sick of student digs and everything that comes with them, like leaky pipes and stuff. I just wanted a nicer place.”
All three eventually settled on Archway due to its green, calm nature – as well as its excellent tube and bus links – and indeed, there is still value to be found across North London despite its ever increasing desirability.
Whatever the case, the clear advice is to place your priorities first and avoid unnecessary compromise on a deal where only some of them are met. While you may well have itchy feet to move out of your childhood bedroom, there’s no point missing it once you’ve gone.
The experts advice
Steve Murray, Lettings Manager at Martin & Co. Camden says:
1. Always be honest with the agent about affordability because that does come to light later with referencing.
2. Make sure your credit history is relatively clear with no CCJs, no bankruptcy and no IVAs. Also, your salary needs to be two and a half times your share of the rent. That’s how the big referencing agencies check. So if you’re going to be renting a flat for £350/week, you’ll need to be earning £45,000/year – between all the people renting the flat.
3. If you can, only make an offer subject to a second viewing because you’ll find the faults at that second viewing. In very busy periods that won’t be an option and you’ve got to take it straight away if you like it.
4. You want to put money down on a property as soon as you can so an agent knows you’re serious and the agent will start negotiating for you. Go a little bit lower than you really want to pay and then wait for a counter offer.
5. Be realistic about what can be done to a property before you move in. It’s ok to ask for a new lick of paint but they won’t knock down a wall for you.
6. One thing we notice here in Camden is people coming with such unrealistic expectations of what their £1,000/month is going to get them.
7. A standard holding deposit is a couple of weeks’ rent. It’s fully refundable if the landlord says no but if they say accept your offer once you’ve put the money down then if you change your mind, you can’t get the money back.
8. If you’re going to be sharing and you don’t know each other, go out and have a drink at the pub before you commit to moving in together.