November is Financial Literacy Month, a nationally-recognized initiative with the goal of protecting and educating consumers about financial services. The theme for this year is Financial Literacy Across Generations. This is the first in a series of Ask Joe columns that will touch on important real estate decisions buyers and sellers face at different times in their lives.
I’m ready to move out of my parents’ house and am looking to rent a place of my own. Should I use a real estate agent to help?
While you may miss the free cable and home cooked meals, moving out of your parents’ house is an exciting event on the path of independence.
Many renters default to do-it-yourself mode when looking for a rental property. Sure there are benefits to a DIY search, like getting to know a new town, but be prepared to invest considerable time pouring over classified ads (or more commonly online listings) and arranging to view your favourites with the respective landlords.
No matter how much energy you have and how eager you are to prove that you can handle the challenge, there are advantages to using a real estate professional to help find a rental.
The process of using a registered real estate agent to find a rental is very similar to that for buying a home. In fact, you could look at it as good practice for when the time comes that you have the financing and desire to become a first time homeowner.
You’ll be asked to sign a representation agreement that commits you to working with the brokerage for a specified length of time. By doing so, you’ll benefit from the same protections available to home buyers and sellers (for example, their education and knowledge of the real estate sector and the area you are considering; professional standards that emphasize fairness, honesty and integrity; and insurance that can protect your deposit for the rental).
Commissions for the services of a real estate agent in a rental scenario are typically paid by the landlord. The downside is that because the landlord is paying the commission, there may be less negotiation room on the rent.
Once the working arrangement is formalized, it’s important to clearly tell your real estate representative about what you’re looking for in the rental (for example, location, price — with or without utilities, number of bedrooms, amenities) as well as what isn’t acceptable (for example, you may not want to live above a nightclub). The more information you share, the better he or she will be able to help. They will then search for rentals that meet your criteria, return with a list for you to consider and arrange for you to see the units you’re interested in.
A real estate agent with experience and knowledge of the area’s rental market will be able to steer you away from less desirable locations (for example, parts of a city with high crime rates) or buildings with a history of maintenance issues (for example, mould, cockroaches or elevator problems).
When you find a place, they can also help negotiate more favourable terms on rent, deposit or the length of the lease. This is a big plus, especially for those who aren’t comfortable haggling for a better deal.
Join the Financial Literacy month discussion on Twitter at #FLM2013.
Joseph Richer is Registrar of the Real Estate Council of Ontario (RECO). He oversees and enforces all rules governing real estate professionals in Ontario. Email questions to [email protected]
. Find more tips at reco.on.ca, follow on Twitter @RECOhelps or on YouTube at http://www.youtube.com/RECOhelps .