Kiplinger Today

Starting Out

6 Steps for Renting Your First Home

Know what you really want, and what you truly can afford, before signing the lease.

Moving away from home or off campus for the first time can be a harrowing experience. Here are some tips to help ease the stress of finding that perfect abode. (Disclaimer: Your first place will probably not be perfect.)

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1. Figure out your housing budget.

Knowing your bottom-line rental costs is a good jumping-off point for your hunt. It will help you determine the type of place you should look for, be it a group house or shared apartment, or a live-alone studio or one-bedroom apartment.

You shouldn't spend more than one-third of your take-home pay on rent, says Debbie Kaplan, of Urban Igloo, an apartment-finder service in Washington, D.C., and Philadelphia. But if you live in a high-cost area, housing might have to occupy a bigger slice of your budget. For example, the average cost of a one-bedroom in the metropolitan D.C. area is $1,410 a month; in Austin, Tex., it's $810.


Also, be sure to budget for utilities. You can check with your area's utility companies to get cost estimates based on zip code. And while you're shopping, ask the landlord if utilities are included in the rent. If not, ask how much you can expect to pay for them each month.

Don't forget to factor in the price of renter's insurance, which can help protect your belongings in the event of theft, fire or other disaster. While your landlord likely will have insured the property itself, your belongings, as the tenant, are not covered under that policy. In most cases, renter's insurance can also help you with the cost of temporary housing if something bad happens. In most states, you can get renter's insurance for less than $200 a year. Buying your renter's policy from the same company as your car insurance policy can cut down on costs in some cases, too.

If, after adding up all of these costs, you find you need more room in your budget to cover housing, see our tips on how to build a better budget.

2. Separate must-haves from nice-to-haves.

To home in on your new home, make a list of what you really need versus what you simply want — and figure out how each item will affect your bottom line. Some things that might fall in the "must have" category: safety of the neighborhood, extra living space, parking or accessibility to public transportation and major roads. (We recommend that you try your commute during your regular travel times to figure out if it's something you can put up with on a regular basis.) "Nice to haves" could include a washer and dryer in your unit, a nice view or proximity to a favorite restaurant.

The list will be different for everyone, of course, and you'll have to prioritize what you're willing to pay more for and what you're willing to sacrifice. For example, when I was looking for a new apartment, it was important to me that I stayed in a central location, where rents were higher than in the surrounding suburbs but I could walk to work and to places I hang out. (At least I saved money on transportation!) Some of the "wants" on my list, such as an outdoor space and an in-unit washer and dryer, were less worth the cost to me.

3. Start your search online.

Now that you know how much you can afford and what you're looking for in a home, where should you start your search? Many major cities have apartment-finder services, such as Chicago's Apartment Savvy or Miami Apartment Locators in Florida, to help you find your bearings if you are new to a city. You can also get started by utilizing friends, friends-of-friends, alumni networks and social media, by putting the message out there that you are on the lookout for a new place. Craigslist is also a valuable resource when looking for an apartment or roommates (just be sure to use it safely).

Once you find some good housing options, stay online to vet them. Googling an apartment building will likely yield reviews and advice from previous tenants. Keep in mind that reviews can often skew to the negative, but they can at least bring your attention to some issues you'll want to investigate further. Sites such as and can also be useful.

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