Budgeting For Your Dream Apartment
So you are looking for an apartment? Awesome, me too! I moved into my first apartment in August and now it is time to find something new. In order to find the best possible option, within my budget, and ideal location I have been doing a ton of research on apartment hunting. I have even taken a class on apartment hunting recently, and I have learned so much in the last few weeks I want y'all to benefit from all of my research! This is the first in my "Find Your Dream Apartment" Series and I am so excited to help y'all out.
First, you have to determine what you want in an apartment and how much you can spend per month on rent and other expenses. Below you will find a comprehensive guide with tips to ensure you are as prepared as possible as you begin your apartment hunt. Lets get started!
Make a List of Your Needs, Wants, and Dreams
This may seem very basic but it is actually EXTREMELY helpful. Especially when working with a broker because you can send them this list so they know exactly what you want. I just made my lists in an Excel document and it took maybe ten minutes.
Your "Need" category will have everything you must have in an apartment to live comfortably and happily. The "Want" category should have items listed that you would love to have. Maybe you'll find a place with one or more of those items in an apartment but you can't expect to have them all. Lastly, there is your dream column this is just everything you could ever want in your most ideal apartment but if you're "balling out on a budget" like myself, you most likely won't get. I have put my spreadsheet down below for you to use as an example, keep in mind yours could be very different depending on your lifestyle and the city you live in.
Determine Your Budget
While this is definitely not the most fun part of apartment hunting it is a necessary evil. The best way I have found to determine your budget is to separate your expenses into 3 categories first; fixed expenses, variable expenses, and non-monthly expenses.
Fixed Expenses: Anything you have to pay monthly that stays the same.
Cell Phone Bill
Variable Expenses: Expenses that can fluctuate from month to month depending on your use of those products and services.
Non-Monthly Expenses: These are the items you can for see spending money on from time to time but not necessarily monthly.
To determine your budget you will add up all of these expenses and subtract them from your monthly income this will give you your disposable income. Play around with different rent costs to determine what cost will leave you with a disposable income you're comfortable with.
You can use this Apartment Hunting Budgeting Guide that I created for you to help you keep all of this information organized.
Lastly, when determining your budget you will want to analyze the upfront costs of moving and the ongoing costs. Your upfront costs include expenses such as movers or a U-Haul, application fees and utility activation. While your ongoing costs consists of items such as internet, cable/streaming services and parking.
Once you have determined all of the expenses I previously mentioned and subtracted them from your monthly income you are ready to determine your budget. A good rule of thumb when you are choosing your budget is to make sure you make 3 times the monthly rent. You are also much more likely to have your application accepted if you make approximately 3 times the monthly rent.
I hope you all found this budgeting guide helpful. The next post in this series will discuss the pros and cons of using a broker during your search, what to look for while touring apartments, and lastly the questions your should ask while touring these apartments. See y'all then!