Budgeting an financing

If you're planning to rent a property in the near future, one of your primary concerns should be ensuring you choose a property that is affordable. You shouldn't just think about the monthly rental payments either – consider utility bills, council tax and your ongoing expenses (such as loans, car leases or child maintenance costs).

Deposit and ongoing bills

When it comes to renting, your largest initial outlay is likely to be the deposit. This varies from property to property and typically, will be one month's worth of rent.

However, some landlords will expect up to three months' payment in advance, so budget accordingly and make sure you know the deposit before signing any paperwork.

However, once you're in the property, that's not where your budgeting ends. Not only will you need to make the monthly rental payments (and on time), but you'll also need to factor in utility bills and council tax. Occasionally utility bills are included in your rental fee, but this isn't overly common.

You'll be able to find out the cost of council tax from your landlord or the agent responsible for the property. Other bills, such as gas, electricity and water, will be determined by your supplier. In most instances these are monthly costs, but it can be possible to pay quarterly if you so wish.

If you've found a property you like the look of, it's worth asking the following questions – to ensure being able to budget accordingly:

  • What bills are included in the rental payments?
  • How much is the deposit?
  • Is there a communal area charge?
  • How often is rent reviewed?
  • Will the landlord accept a student?
  • What happens if I'm on housing allowance?
  • Is a guarantor accepted?
  • Is the tenancy for a fixed term?
  • How long has the property been on the market for?
  • Is the monthly rental fee negotiable?
  • How much is council tax?

Each of these questions is designed to help you better manage your budget and ensure your money goes further each month.


Tenancy deposit scheme Scotland

In Scotland, the rent deposit scheme is in place to protect tenants and ensure they have the best possible chance of receiving their deposit back at the end of the agreed term. The deposit is protected by an independent party, with three operating in Scotland:

  • Letting Protection Service Scotland
  • Safedeposits Scotland
  • Mydeposits Scotland

In fact, every landlord letting out a property in Scotland must:

  • Pay the tenant's deposit into one of the three schemes above
  • Provide the tenant with all key information on the tenancy and deposit

Do all landlords need to comply?

In simple terms, if the landlord has registered with a local authority and taken a deposit from the tenant, they must comply with the rent deposit regulations. There are exceptions though, such as:

  • Property lets to family members
  • Life rents
  • Holiday homes
  • Properties used by religious orders
  • Houses subject to control orders
  • Agricultural and crofting tenancies
  • Resident landlords
  • Transitory ownership

It should be noted; these regulations only apply in Scotland.


Housing Benefit

If you're receiving a low income and struggling to make monthly rental payments, you could be eligible for Housing Benefit. Dependent on your situation, you may be entitled to having the whole, or part of your rent paid. There is no set amount you will receive and instead, it's worthwhile using one of the government's calculators to assess your circumstances.

You could be eligible if:

  • You pay rent
  • You're on a low income
  • You have a low level of savings

For more information and to see if you’re eligible, call the Jobcentre Plus on 0800 055 6688.


What if a letting agent is used?

The tenancy deposit scheme is the responsibility of the landlord only. If the letting agent takes your deposit, it remains the landlord’s prerogative to ensure the correct measures are taken. As such, it is only the landlord that could fall foul of the law, and is ultimately responsible.