private renting affordability

[Slowlymakingprogress]

I'm a single parent with one child earning £16600 full time on a 6 month contract but I'm almost certainly going to be kept on after the 6 months. I live in a housing association property in a rough area. I'm desperate to move to a nicer area where there are better paid jobs.

My plan is to get a private rented house in the nice area and then find a better paid job. This will be easier to travel and to juggle childcare. The rent is around £575-600 per month. I have £5k savings that I could use to pay rent up front if necessary.

The lettings agencies all mention affordability tests. What are these and would I pass? From what I've read online, it seems similar to getting a mortgage! I know I can't get a mortgage on a 6 month contract as a single person but does this mean I can't rent privately either? I don't have any family so I don't have a guarantor.

I've always lived in housing association properties so I haven't a clue about what the process is for renting privately.

I forgot to add, there are no housing association properties in the nicer area so private renting is my only option.

I'd think carefully before giving up the relative security of a HA tenancy.

You might be able to get the private tenancy with your salary and savings (I think when I last rented we had to have an income of 2.5x the rent, but I'm not sure if that was before or after tax, and if it would include child benefit etc).

However your landlord could decide to sell the property or put up the rent after 6 months or a year, and then you'd need to come up with another deposit and removal costs before you get the first deposit back, plus the insecurity of trying to find another home.

Could you use some of the savings to learn to drive / get a car, so you can commute to the area with better paid work, while keeping your secure tenancy?

From my experience it’s similar to mortgages, I.e your annual income has to be at a certain multiplier to the rent payment. I had to pay 6 months upfront until I met the affordability.

God no don't do it! I private rent and I live every day with the fear that I'll be asked to vacate. I was lucky last tenancy. 10 years. Before that it was 6 months. One year before that. I'd try for an exchange. The not so nice areas where I live still get people going there by choice. Usually to be closer to family.

I've got other savings tied up elsewhere that I could use if I really had to but I have that earmarked for a mortgage deposit in the future. I have set aside the 5k for renting.

I live in the most rough and deprived area in the whole town. Vermin problems, rubbish everywhere, high crime rates and unsafe at night. I really don't want to raise my child here. No chance of a swap, no one else wants to live here either!

The private renting will hopefully just be a temporary thing as I'm hoping to buy somewhere in the same area within the next few years. I just can't bring myself to stick it out living here for the meantime (which would obviously be the sensible option)

No harm in giving it a go. If you don’t pass the affordability test you might just be able to pay more upfront. Sounds like your only option. Well done for saving so much - we struggle saving that much!

I'd get a better paid job on a permanent contract before moving; it will hold you in better stead.

The length of your current contract would be an issue for tenant referencing. Permanent is better.

Also consider how much private rents will increase over the next few years. You might find yourself trapped in private rentals with unstable tenancies, whilst property prices increase. Then you are locked out of buying.

I honesty think you are better off staying out & saving a bigger deposit while you look for a better, secure job (not after).

I have a stable professional job on a training contract which I'm tied into for the next 7 years - guaranteed job in this period. But because the job moves, my current employer only referenced me for the 6 months I'm with them (next job is lined up and next door). The referencing system only let my landlord give me a 6 month contract because I was high risk (this despite the fact that I can prove guaranteed employment for longer).
Use some of your rent deposit money for a car so you can get that better paid job on a longer contract. Then move.

I'd go for it.

To rent I think annual wage needs to be 30x rent if I remember rightly so you could afford £550 a month although that may be different depending where you live (we are down south)

neighbour paid landlord under 5k desposit and when moved out the landlord didn't give it back. court case won but because it was under 5k, she says, there is no way to push landlord to pay. there are issues with how much deposit is good to pay to ensure you get it back 100%. perhaps better to invest 4k in Lifetime ISA this financial year and 4k in the next one. You'll get 1k added by the government. so by April 2019 you'll have 10k for a deposit for a house under 425k anywhere in the country.

maybe this will be an interesting read. if you consider buying a shared ownership house or flat. you have a job and look forward to a career. it is very positive that you are thinking about the future xxx www.moneysavingexpert.com/news/2018/10/autumn-budget-2018--housing-changes/

www.sharetobuy.com/guides-and-faqs/shared-ownership-eligibility/

Probably not worth giving up the HA place.

The last few times we have moved the letting agent have provided the landlord with multiple applications, and it seems from what they tell me that the highest earning couple with no pets, kids, or smokers tend to get the place.