Finding the perfect single-family home to rent is an incredible feeling. Moving into your new house rental is even better. But, when the time comes to sign the lease agreement, the last thing you want is to discover unexpected costs that could strain your budget. A common, yet largely unknown, additional cost when renting a house in both Canada and the U.S. is the move-in fee.
Move-in fees don’t have to be a nasty surprise though. In this guide we’ll look at exactly what they are, how much you can expect them to cost, and everything else you need to know about this hidden rental charge.
What Are Move-in Fees for Rental Houses?
Move-in fees are imposed on new tenants by property management companies or landlords directly before they can move into their new home. These fees are used to prepare the rental unit for the new tenants and typically cover cosmetic maintenance and small upgrades.
Move-in fees are usually non-refundable and are not often very heavily regulated, essentially enabling landlords to set terms and charge what they deem fair.
Are Move-in Fees Legal?
While a lack of regulation may be a concern, move-in fees are completely legal. And, even though many areas don’t place a cap on the amount that can be charged, local laws can provide more rigid regulation. When confronted with move-in fees, it’s always worth taking a look at the local laws and regulations to make sure the cost is in line with the laws in your area.
Even though the regulation of move-in fees is fairly light in many places, most landlords and property management companies tend to set a fair price. Charging too much compared to other rentals in the area can put potential renters off, so it’s not usually worth the risk. In a hot market, however, you may find that move-in fees creep up. Always check comparable properties before signing on the dotted line.
What’s Covered by Move-in Fees?
While move-in fees might not sound fantastic at first glance, they are used to cover a variety of things to ensure your comfort when you move in as a new tenant. Smaller updates and upgrades, mostly cosmetic in nature, are typically covered by move-in fees. Some of the most common include:
- Fresh paint job: any tired-looking areas after the previous tenants have moved out will generally be touched in to freshen the place up.
- Repairs: damage caused by the previous tenants will usually be fixed, ready for you to move in.
- New locks: for your safety and security, it’s not uncommon for landlords to fit new locks and reprogram security systems between tenants.
- Minor appliance and fixture upgrades: such as new toilet seats, replacement light bulbs and lamp shades, etc.
Larger upgrades and major renovations generally won’t be covered by move-in fees, so don’t expect a brand-new kitchen to be fitted or a full house redecoration.
If you want to know how your move-in fee is being spent, you can ask the landlord to provide an itemized list.
How Much Are Move-in Fees?
Now you know what your move-in fee is being spent on, you’re probably wondering how much it’ll cost. There’s no set price and the cost typically depends on how much you’ll be paying in rent. In general, you can expect to pay between 20% and 50% of your monthly rent on move-in fees.
For example, if your rent will be $2,200 each month, your move-in fees will usually be anything from $440 (20%) to $1,100 (50%). Of course, it could be higher or lower than that depending on the exact fee set by your landlord or property management company.
While move-in fees might not be as high as a security deposit, it’s still a considerable sum, so it’s essential you budget for it.
Are Move-in Fees Negotiable?
Of course, move-in fees aren’t set in stone and they are open to negotiation. However, this largely depends on the demand for rental houses in your area. In a hot market, landlords will have very little incentive to negotiate the move-in fees. On the other hand, if demand is low, you might have some success in negotiating a lower price.
In most instances, private landlords will be far more likely to negotiate compared to property management companies.
Move-in Fees vs Security Deposits
While similar, move-in fees and security deposits are not the same thing. Security deposits tend to be more rigidly regulated compared to move-in fees, which are largely implemented in any way the landlord or property management company sees fit. There are several other differences too.
- Price: the security deposit is typically more expensive than move-in fees, often the equivalent of a full month’s rent.
- Refundable: move-in fees are non-refundable, whereas the security deposit will usually be returned to the tenant once their lease ends, minus the cost of any necessary repairs to damage caused by the tenant.
- Restrictions: strict laws limit what a landlord can use the security deposit to pay for. Move-in fees, on the other hand, are less tightly regulated and landlords can use it for a variety of things they feel are required.
It’s not uncommon for a landlord or property management company to ask for both a security deposit and a move-in fee. This is completely legal and justified by the fact that the landlord will want to ensure the house is comfortable and clean for you when you move in while protecting themselves against any potential damage after you’ve left.
Having said that, there are cases in which they might only one of the fees. Short-term leases may not be subject to a security deposit, for example, since there’s a lower risk of the tenant causing damage and less chance of wear and tear.
Overall, as long as you’re expecting them, move-in fees shouldn’t be anything to worry about. Be sure you budget for them accordingly and double-check local laws and regulations to ensure the fees in place are all above board.
