What renting really costs

Before you sign anything, work out the money you need on day one and the money you need every month after that.

Money you need up front

• First month rent, paid when you move in.
• Last month rent deposit, which a landlord in Ontario is allowed to ask for. It is held and used for your final month.
• A key deposit, which can only cover the real cost of replacing the keys.

Monthly costs to plan for

• Rent.
• Utilities such as electricity, heat and water, unless they are included.
• Internet and phone.
• Tenant insurance, which many landlords now require. It usually costs a small amount each month and protects your belongings.
• Transit or car costs to reach work and school from that neighbourhood.

Make a monthly budget

Write down separate amounts for rent, electricity, heating, water, internet, phone, tenant insurance, transit, parking and laundry. Prices vary widely by city, building and household, so use the actual amounts from the listing and service providers rather than a general estimate.

Costs people sometimes forget

• Moving costs, basic furniture and internet installation.
• Laundry, parking and tenant insurance.
• The cost and time needed to travel from the neighbourhood to work or school.

A common guideline is to keep housing costs near or below one third of your household income. Many newcomers pay more than that at first, so it helps to look at the total of rent plus utilities plus transit rather than the rent alone.