Questions to Ask When Checking out an Apartment
When going to look at an apartment, most people look for the basics. They would like to see the size, condition and layout of the apartment. However, there are some questions which are equally important, which are seldom asked. Here are a few things to keep in mind when going to look at an apartment.
- The noise. It is important to ask how many kids are living upstairs and their ages. Also, ask about the soundproofing if you don’t see it mentioned in the listing. Knowing where the bedrooms are situated vis a vis the home upstairs is a must. For example, if your bedroom is directly beneath their rough tiled breakfast area, you will be awoken when they are serving breakfast, something to keep in mind.
- Ask for references of previous tenants and call them. Ask them whether they found the landlord pleasant and responsible. If not, you had better think twice before moving in, regardless of how good a deal it is. An insensitive landlord can be the source of much aggravation and Loshon Hara. A clear contract can also help avoid many issues. (You can download one in our Insurance and Services section).) Also, if you are paying utilities, ask how much they average a month.
- The shuls. Check to see whether you will be comfortable davening in the shuls in that area.
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We are often asked what piece of advice do we feel is most important for renting couples to hear.
Our answer is unequivocal, “Renters Insurance”! So many of Lakewood’s yungerleit are living without coverage on what are often thousands of dollars’ worth of personal property. Most parents save for years to be able to supply their Chosson/Kallah with the basics to start a home, spending an average of $15K a couple. If, Chas veshalom something should happen be it a fire or a water pipe burst, it would be a struggle to recover their losses. It has happened before in Lakewood where a fire destroyed all a couples possessions, and if not for their rental policy, they would have been left in very tough financial situation. Rental policies are cheap enough to be no-brainers. For less than $200 a year you can get coverage for up to $25k. These policies cover your personal property from fire, water, mold and theft among other things.
When shopping around be careful to ask questions about jewelry and silver maximums and whether you will need appraisals. Also, make sure to take pictures of every room in your home because it is often hard to recall everything you own when making a claim. Documentation of property ownership i.e. receipts and credit card statements are usually not necessary as most reputable companies will honor you word, but always ask to be sure.
Renting vs. buying
The question being addressed here is, whether it makes sense for a young couple to buy a home as opposed to renting one. There are many different angles one must consider before he can reach a confident decision. We will attempt to list the main aspects one must consider.
Assuming that a home suitable for a couple is in the 180K range, a Coventry townhouse for example, the 20% down payment will be 36K. A mortgage of roughly 150K will be taken, the added 6K to cover closing and title costs. At the current interest rate hovering around 4.00%, the monthly payment on that mortgage will be around $700 a month. Add to that, real estate tax of around $3600 a year, coming out to $300 a month. Another $30 a month for home insurance and your monthly total is $1030. Pretty much the same as a comparable rental.
However there are other costs associated with owning a home which must be factored in as well. Most all homes in this price range are going to require occasional repairs and maintenance, the older the home the more often and costlier they will be. As you are the owner, any and all such expenses are your responsibility. For a 180K dollar home in the Lakewood market, it’s safe to assume around $600 a year on maintenance, or $50 a month. Furthermore, if the home you are considering is in a community, there may be monthly fees to be paid.
As far as building equity, there is usually very little to speak of. This is because you probably won’t be living there for more than 5 years due to their size, hardly long enough to have paid a substantial amount of your principle. So all in all, there is really no financial gain using the formula above. If, however, you have more than the requisite 20% for a down payment, thus lowering your mortgage, or are planning on retaining the unit as an investment after you move out, then it might make sense.
Most often overlooked however, is when you are ready to move on to something bigger, will you be able to take your money out of the house. Couples rarely stay in their first home for more than 5 years, not enough time for the property to appreciate in any substantial way. This means that you will be selling your home for around the same price you bought it for. Even if your home appreciates 10%, or $18,000 by the time you are ready to sell, the agent fees for selling your home will eat up those profits very quickly. Furthermore, it may take a while for the home to sell, restricting your ability to move to a much needed larger home.
Buying a home is a far larger commitment than renting. As such the due diligence required as far as ascertaining whether you will be happy there is all the greater. If you don’t like the neighbors in your rental all you need to do is call the movers. Once you buy however it is all the harder to move. As such it is extremely important that you take a close look at the community, the families, the shuls, the standards, and make certain that it is a place you and your family will feel comfortable. Also, look at what crowd they are attracting to know if in the future you will continue to be as comfortable.
Many basements in Lakewood don’t have separate meters, making it all but impossible to gauge a basement tenants utility usage. Best case scenario, all utilities are included in the rent. When this isn’t the case, there are various ways to split utilities .The formula which is most common here in Lakewood is to split the water bill in three, the tenant paying 1/3. This isn’t the greatest solution though, because the landlord usually uses far more than the 2/3 he is paying for.
Another way to do it, which we have yet to hear being done, is to split the bill by the total number of residents, upstairs and down, and have each pay per the amount of people in their residence. For example, say the landlord has six kids plus himself and spouse, and in the basement is a couple, bringing the total to 10 residents. If the bill is $150, meaning each person is using $15 worth of water a month, the couple will pay $30, as opposed to 1/3 which would be $50.
However it’s done, splitting utilities has the advantage of less bills to deal with at the end of the month.