Sunday, 4 June 2017

Learning my options

It's not like I've never moved before or had to set a place up from scratch. I know what the basic expenses and expenditures are: set up fees for utilities, bathroom & kitchen items, furniture, etc. I know it's stressful and frustrating at times.  That's just for an apartment - never mind the legal fees, movers costs, etc. that are involved with an actual house. I also know that, despite that stuff, it's an excellent opportunity to declutter and move with a nominally smaller amount of stuff.

But I've never in my life had to pay estate agent fees on top of that to find a place. I'm not sure real estate agents even deal with rentals in Canada, do they? Certainly, I've never used one to find an apartment before. I thought they stuck with houses and condos and things, not rentals. I've been lucky and things have always worked out for me and I have no reason to think it won't be the same now, but I'm learning that it just might be a bit more difficult.

I've been chatting to a couple of estate agents about the process and am learning that each estate agent has different fees. These range between £200-£600 ON TOP OF RENTAL DEPOSITS which are 6 weeks' worth of rent + first month. There are referencing fees (which are charged PER PERSON); there are Tenancy Agreement preparation costs; there are Pet Addendum fees (if applicable); there are check-out fees at the end of the tenancy; there are Tenancy Extension fees. All are non-refundable. Some may be refundable, but only if the landlord changes his/her mind over you as a tenant, not if you change your mind about being a tenant for that property. I'm afraid to ask whether these fees are charged per flat (at the same agency) or if, once referenced, etc., you are on the books with them and can look to your heart's content. Certainly, you pay more fees if you sign on with more than one agency.

So the minimum I need to rent a place is almost £2,500 before I've even moved in. And if for whatever reason, I don't get accepted, I lose my fees. I can't afford that.

It's criminal. It really is.

I've also learned from one of the agents that the referencing tool they use requires someone interested in a place with a monthly rent of £850 to earn £26k per year. Someone referencing for a monthly rent of £700 is required to earn £21k. That is £5-£10k more than I currently make (and there isn't a great chance that I'll ever make either one of those numbers anytime soon). Which leads me to believe my available rental level is somewhere around £300-£400 per month. I'll be lucky to find a room for that.

I do appreciate, however, that they want to ensure they get the rent. I understand - to a point - why there's a minimum. I don't understand the variously priced fees for the agents. Why not a flat fee for all of that?

How do people rent places? I work full-time and make a very modest wage. Even without my debt payments, I won't qualify (based on the above numbers) for even a studio flat. I'm likely going to start with moving from my room with my cousin to another room in someone else's house. I was hoping to avoid that, but I can't afford to be particularly fussy sadly.

Despite all this, I KNOW the perfect place is out there for me. It may just not be ready yet. I've never failed to find a home - even when I had four cats - so I'm not worried, just kind of disgusted and slightly frustrated. Knowledge is power, however, so it's not a total waste of time learning how the process works. I know what I want, so I just have to be patient. I'm in a very fortunate position, with a job, a comfortable place to live and a cousin who, while itching to get to work on her house and have me out of it, won't leave me homeless and is being kind and generous enough to let me pay a minimal amount so that I can save most of my wage to put towards a place.

In other news, I've paid off a bill from the Canada Revenue Agency which was from 2014. I cashed out one of my RSPs but was unaware that it was subject to 25% tax, as I'm a non-resident (although I thought I wasn't deemed a non-resident until after I'd cashed it out. Anyway...). I got the bill last month and finally got around to calling Ottawa about it a week or so ago. The only place I could pull the funds from was my LOC, so I've done that today. I'm both glad and sad about this. I was one payment away from clearing a full $1000 off my LOC and now I've fallen back down again, but I no longer owe the Canadian Government and I think that's a wiser move. Plus, the interest rate is lower on my LOC.

I was told some complicated way of paying it off through the CRA website, but it didn't give me an option to pay from a Canadian bank account (assuming, I suppose, that you don't have one). I specifically asked if I could pay it through my bank account and was told 'no'. I was surprised but took her word for it - she should know, right?

Well, apparently she doesn't. I wanted to clear it up today and after looking at a couple of options, I went to my bank and checked what bills were available to set up and there it was: CRA NON RES ARR (CRA non-resident arrears).

So. Done.

Once I've moved, I really need to find a part-time job.


Jennifer said...

In America it is like that. For apartments (flats?) it is worse. The cost varies per day! It is ludicrous! My son is in the same boat - kind of tired of crappy roommates, but does not make enough to qualify for their rents. They are asking 3-5x the monthly rent.

You are right, places always do come up, but it sure is stressful in the meantime! I hope it goes smoothly for you!

Northern Living Allowance said...

Hi Jennifer - I didn't know that! It doesn't make things easy, that's for sure. I really hope your son can find a reasonable place with or without a roommate. It can sometimes be worse with a roommate, although I've been lucky for the most part in the past in that respect too. I guess you don't really think about this sort of stuff until you need to! I'm not worried that I'll find something. As I said, I have the luxury of leisure, a steady job and some time on my side. I really don't want to have to take a room with someone else as a stopgap, but will if I need to. At least I can be specific about where I want it that way. Good luck to your son! xx

T'Pol said...

That is an awful lot of money! Aren't there people willing to advertise on their own cutting the middle men out? When there is no real estate agent, it is a bit cheaper over here but most owners do not have the time or the patience.

Jane said...

So is that a must? You have to have a rental agent? Not a requirement here in Canada as you well know. That is pretty stressful especially the non-refundable part. Very complicated and doesn't seem very fair. Is having a roommate again a possibility for you? Sharing the expenses would allow for a larger place or would allow you to save up more for a place of your own. I'm sure it will all work out for the best - try not to get too stressed in the meantime!

Northern Living Allowance said...

Hi T'Pol: There are probably private landlords out there, but this seems to be the way of the majority of it here, which is most frustrating. I have scanned ads in papers but there doesn't seem to be much, unfortunately. There is a site called 'Spare Room' which advertises just what it says, so that might be my only option at this point. They generally just need some references and one month's deposit, but you're living in someone's house, so it's not my preferred option. But beggars can't be choosers, as the saying goes! xx

Hi Jane: It appears so, unless I use the Spare Room option, as I mentioned to T'Pol. I used that option for my room in Chertsey, so I know it works, it's just that, ideally, I'd like my own space. Rooms seem to go for £400-£700 a month, depending on how fancy the room (appears) to be, what's included, etc. I'm already paying £450. I didn't think we had rental agents, as I've never used one before so it's just a very frustrating process to find myself in. But as I say, I'm not worried. I WILL find something, it just might take a bit of searching and a little compromise. :) xx

MW said...

Wow, the whole rental process is so not friendly -- Unlike the laws here. I would have never guessed that about the UK. Conservative yes, but this feels totally unfair to renters.

Best of luck on finding a private spot to call your own!

Northern Living Allowance said...

Hi MW - no, it isn't! Having delved a bit deeper, each agency has it's own set of rates and requirements - but there's nothing less than £450 (all non-refundable, of course!). So frustrating! I've also discovered that my upper limit on my wage is £550. This leaves me a choice of 2 flats - and both are actually quite cute, fortunately! But will they still be available when I need one is the question. Ah well. What can you do? And thank you - I'll find something. I always do xx

Ysabelle said...

We just moved into a flat recently & our agency fees were £420 including VAT plus a refundable holding deposit of £200 (got it back in first month's rent). We live in York where renting or buying seems unusually high for outside London. I have to say though, up here we don't pay for agency fees until you actually apply for a property so you wouldn't pay agency fees on just looking but maybe things are different down south? Though if you've had your references done and your application falls through because of a landlord, your fees should be carried forward unless you decide to go elsewhere I think.

I would keep an eye on spareroom as some landlords do advertise whole properties on there, not just rooms. Wish you luck on your hunt and that you find something soon!

Northern Living Allowance said...

Hi Ysabelle! Thank you for stopping by :) I am envious you live in York. I was there in April and loved it. I agree, though, I was surprised at how expensive it seemed. Yes, I wouldn't pay until I actually applied for a property but it means I have to add it into my rental costs and if for some reason, I had to go to a second agency to find a flat, I would have to add their fees on as well. I don't know if referencing carries over - I would have thought that if there's a database of sorts that it would be a lot easier just to access that and find what they need.

I have also been looking at spare room and have seen several lovely rooms, but as I'm in a room now I would kind of like to have my own full flat. However, I'm aware it may possibly be my only initial option.

Thank you for your advice and for stopping by! xx