RELOCATION: Thinking of renting in New Jersey?
For many expats this can be a very good strategy. The main benefit being that as newcomers, they can get a comfortable familiarity with choosing where they want to live, before investing a large sum of money in purchasing either a house or apartment.
Although quite a number of expats do buy property on first arriving or even before, sometimes these purchases are regretted later, as they are made without a full knowledge of the location’s disadvantages, which become obvious post-purchase. Renting may not always be glamorous but it helps minimize this issue at least.
Renting in the New Jersey though can have its own share of surprises as things are done differently here than Australia, and no doubt other places.
Here’s a few pointers to help you be better prepared:
1. You need Renter’s Insurance
When you get to sign your rental lease, it will likely be expected you have or will obtain in the near future, renter’s insurance. Although it may sound like something to protect the landlord from wild ‘party-animal’ occupants, it’s actually intended to protect the tenant. Renter’s insurance is much like contents insurance with the added extras of liability protection if any guests have an accident while visiting and coverage of medical expenses for any such visitor injuries.
To be clear here, landlords do not have liability for a tenant’s belongings. This policy negates the problem of who pays for damage to a tenants goods through accident or mishap. For a pretty small cost ~ $100-$200, you will be able to avoid issues like this. Most NJ rental leases require the tenant purchase this insurance as a condition of signing the lease, so it’s almost inevitable you will have to get a renter’s insurance policy some time.
2. Evidence you can make regular payments
As a newly arrived expat in NJ, you will most likely not have an established credit history. This is OK but the landlord or managing agents will need some proof that you are able to manage rent payments through the term of the lease. If you have moved here for a job, then the best idea is to have a letter from your US employer, verifying what your new position is, what your salary package is and if possible the term of your contract here in the US. This should be available to provide the agent for the landlord or managing body, at the time of lease application. Alternatively, they want to site some of your recent pay stubs.
3. Up to 3.5 months rental required as startup costs
To start your lease, you will most likely be expected to have the following payments ready to provide at short notice:
- Up to 1.5 month’s rent as security deposit (security bond).
- One month’s rent to start the lease.
- One month’s rent as a commission fee to pay the realtors, who are handling the property. This is also called a brokerage fee. In Australia, the landlord usually pays the commission to the real estate agent (realtor) when the property gets rented by a new tenant. In New Jersey, however, it’s the tenant who pays this fee.
These fees will need to be paid via a bank check (certified check) or in cash. Credit card and personal checks are not usually accepted.
When paying the realtor’s commissions, you will be asked to get two separate checks, as usually the realtor representing the landlord (if one is involved), will split their fee with any realtor that you are using. The fee is usually not a straight 50/50 split, so you will need to get the exact amounts from the realtor. Often these payments need to be finalized before the deal is considered ‘done and dusted’ or even before you are allowed to move in.
4. Ongoing service fees possible on top of rent
Before you sign the lease make sure you are familiar with any service fees or extra costs added on beyond normal utilities you are responsible for. In the case of an apartment building where you are renting, if there are other services provided such as a gym, pool, parking, BBQ or office facilities, you may be required to pay an annual amenities fee. In addition you may have to pay a moving in fee.
For rental houses, where the landlord has a standing agreement with a provider of snow removal or gardening services, you may be asked to continue that agreement. This may be a negotiable point if you are happy to provide the services yourself.
Often, landlords expect the tenant to make a contribution to repairs and may ask for a specific dollar contribution for repairs to the toilet or other area which the tenant uses frequently. Read the rental lease carefully. Even though most people use a standard lease, there are often little extras and modifications added which are easily missed.
5. Don’t buy a refrigerator and washing machine
Rented houses usually come supplied with a refrigerator, washing machine and dryer included. So if you are moving here from another country, you will not need to layout extra money to purchase these. Most times, there is also a dishwasher and microwave provided too.
In nearly all apartments except older versions or very small apartments, these appliances are provided there too. Sometimes the washing machine and dryer may be located outside the apartment in a community laundry, although this is not the case with larger apartment complexes that are setup as communities or condominiums.
In both this article and a previous one, ‘4 Things to ask before renting a house in New Jersey’, I have tried to summarize as many tips as possible to help new expats who are thinking about renting in New Jersey. Undoubtedly, though, there are more tips to learn from others with longer experience in renting in NJ. So please feel free to add any of your own!