Renters are paying more these days — and many are busting their budgets just to keep up with housing costs.
No matter where you live, there’s a good chance rent is one of your largest monthly expenses. And if your lease is coming to an end soon, you may need to prepare for your housing costs to climb.
CoreLogic reports that as of September, U.S. rents were up 10.2% on a national level compared to where they sat the previous year. So if your lease is expiring in the coming months, your landlord may attempt to raise your rent. If you’re concerned that will happen, here are a few essential steps to take.
1. See how much of an increase you can afford
Maybe you’re currently spending $1,000 a month on rent, and you’re convinced your landlord will raise that to $1,100 once your lease comes due. If that’s an amount you can afford to spend, you may not need to panic (even though you probably don’t want to see your rent increase.)
Take a look at your budget to see how much wiggle room you have. If you’re getting a raise in the new year but have a lease expiring in February, your higher paycheck may take effect before your housing costs go up, making a rent hike manageable.
It also wouldn’t hurt to see how your savings account is looking. If you can’t really afford a rent increase based on your income but you love where you live and don’t want to move, dipping into your savings a tiny bit may not be unreasonable.
As a general rule, your earnings should cover your living expenses. But if staying in your home following a rent increase likely means maxing out your paycheck and ending up $20 or $30 short each month, you may be okay to dip into savings if you have many thousands of dollars socked away.
Right now, rents are up across the board, but they could come down in the future. So if you need to tap your savings to get through, say, the next year, that’s not a terrible thing if the money is there and you have plenty left over for emergencies.
2. Talk to your landlord before you’re given a new lease
Your landlord may have every intention of raising your rent. But if you make it clear that’s something you truly can’t afford, your landlord might reconsider — especially if you’re a respectful tenant who’s been paying rent on …….