SIGNING your first lease can hit your hip pocket hard and leave you spending on expenses you never even considered.
The start of the year is a busy time for real estate agents and tenants signing leases, particularly for university students who are moving out of home for the first time.
But before signing the dotted line on any lease documents realestate.com.au's executive manager of rent Kul Singh said tenants need to map out a step-by-step budget of all their costs involved.
"Start with a financial plan and how much you want to spend when it comes to rent and utilities,'' he said.
"About 31 per cent of properties on flatmates.com.au, which is a share housing website, does not have a minimum term of how long you can stay at the property.
"You could easily try sharing in that suburb firstly to see if you really like it and if you don't try somewhere else before you have a commitment for 12 months."
Mr Singh encourages prospective tenants to understand the costs of using public transport in the area if it's available, or alternatively the charges to park your car, as these quickly add up.
From here, the constant rental payments and weekly living expenses can quickly mount up into the hundreds of dollars.
"If you are looking for the traditional rental there's upfront expenses like the bond, the upfront monthly rent that has to get paid and the ongoing utilities expenses and food costs,'' Mr Singh said.
Using apps to split bills between housemates is a good idea, as is setting up a joint bank where each housemate can make equal contributions.
Landlord insurer Terri Scheer's executive director Carolyn Parrella said moving out of home for the first time is exciting but you need to be realistic about what you can afford and make sure you have insurance.
"Make sure you can afford the bond upfront and usually you are paying at least two weeks' rent in advance for the first time so you will need a minimum of six weeks rent to be able to start the lease."
"Tenants should also think about insuring their contents as well because they can get stolen or damaged so insurance is important for landlords and tenants as well."
She also encourages tenants to do a thorough property inspection once they have moved in and make sure there is not any damage or defects or they could be hit with charges later.