How to negotiate a lower rent
Even at this time of high demand for rentals, a good tenant can sometimes negotiate a better deal. But success requires being smart, as well as being a good tenant.
For those of you looking to rent your first apartment (or rent for the first time in many years after giving up homeownership), we have a tip: Rent is negotiable.
It’s especially negotiable when it’s time to renew your lease and you have paid your rent on time for 12 months and otherwise been a good tenant.
While rising demand for rentals has given even the best tenants less leverage, it may still be possible to negotiate lower rent, improvements or, at least, a smaller rent increase.
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"Landlords are looking for good tenants who pay their rent on time, take care of their rental unit, keep noise levels down and stay on good terms with the neighbors and property-management staff," Kari Taylor, director of rental insights at Rent.com, told U.S. News.
Beginning landlords sometimes don’t realize the value of a good tenant, until they’ve had a bad one. But good landlords understand that even a routine change in tenant often costs a month’s rent, meaning that reducing the rent for an existing tenant might still net the same amount of money.
Ellen Smith, writing at The Huffington Post, includes eight tips for negotiating a lower rent and includes a copy of the successful letter she wrote to her landlord that resulted in a smaller rent increase.
U.S. News’ Daniel Bortz also has eight tips for tenants seeking to negotiate a better deal when it’s time to renew a lease. Among them:
- Know what the going rate is for rent in your neighborhood. If you can point out that you could move to a comparable apartment and pay less, that could be persuasive.
- Ask the landlord for guidance. Rather than threaten to move, just mention that you could save money if you did move and ask the landlord what he or she thinks.
- Explain any mistakes you made during the year. If your rent payment was late once, explain why it happened and what you’ve done to keep it from happening again.
I am a landlord for a good number of apartments and it is truely amusing(and often discourging) to hear what many of the public thinks works. I try to keep my rents at the low end of the range demanded by equal apartments. I also get many people who say that my apartments look much better than others at a higher rent. I do not negotiate because I know what the market is and I am never trying for the highest rent possible. I guarantee that I will not raise the rent for at least a year...and I often dont raise it for three or four years. Increased costs often are the triggers for increased rent amounts. City services keep going up as cities try to bolster their income by charging much more than their costs to pay for city spending for other things. They pad the bills for garbage, water, sewer, fees etc. beyond reason...to pay for whatever they want to spend. The taxes for schools has gone sky high. The cost of building schools has gone from 10mil to 20mil to suddenly 50mil and now 100mil. While renters keep voting for these most expensive schools and dont connect that it will cause their rent to go up....Also the property tax continues to increase. The county people seem to think that they must supply government with a higher and higher level of taxation to serve every want of government.
I also will never rent to the person who spends his time telling me over and over how bad landlords have been to him. I always rent month to month and tell renters that if they are unhappy, that they should move to a place where they think they will be happy. Many of the unhappy renters will continue to be unhappy wherever they live...and I dont want to hear it. Many renters appear to believe that they must have some holy right to be negative at every opportunity. I am very happy with 95% of the tenants...but, there is always that 5%.
I charge enough rent to make a reasonable return and I do not negotiate. I know where my rent amounts fit in the local market.
I try to stay out of my tenants business and lives...and prefer that. Tenants generally do not want constant attention from their landlord.
It seems like in such a scenario, which is like for like with my present situation, that the tenant is in a position to "negotiate" lower rent.
Beside paying your rent on time, showing pride in your rental unit is imperative. For example, keep a really nice looking, well decorted patio. Keep the entrance clean and attractive. This is especially helpful if you have a unit that is near the office or in another high profile location.
Stick around to help clean up after parties or get togethers that management holds for tenants. Write thank you notes after paties or for staff who goes the extra mile (such as quick maintenance response). If there is a regional manager (management company) over your apartment manager, occasionally drop a line there to pass along sincere compliments and appreciation for a job especially well done. Stay on very friendly terms with staff in general. Generally create no major disturbances at the complex and try to get along with everyone.
This has always helped me negotiate for upgrades, especially at rental renewal time. New closet doors, new appliances, new tile in bathroom, etc. It also has kept rent from being raised over a period of years and got me first dibs on a prime location transfer. I have never been able to negotiate a rent decrease though.
I've rented all my adult life. I've tried to negotiate a reduced rent by offering to pay for an entire year upfront with a 10% discount (denied). So, the next best thing is to write 12 rent checks (one for each month) and mail them to the management company all at once. That way, they have my rent right on time. I ask for the longest lease term they offer, too.
Also, if you have any sort of talent when it comes to interior/exterior design, don't be afraid to offer suggestions on how you think small changes could increase the property value.
She is partially correct.. I both own a house in Florida, which I rent out and I am current renting a place in Missouri (reason is a contract job). For my Florida house I calculated in the cost of everything that she mentioned. i.e. even maintenance for the lawn, AC unit, painting, carpets, etc. when I decided what I would charge my tenant. For the place that I am renting, do you think that was not calculated in as well. But, again, please note that I said that Suze Orman was partially correct. Most mortgage / bank require a percentage of the cost (total cost of buying the home) to be paid up front. If that percent is less than 20% then PMI is added - an additional cost. Without being too long winded here. There are many things to look into when buy a home. As is said - there are "hidden cost" to home ownership! Having a good realtor is VERY important (and no, not my profession). I have learned from past dealing though.
I hope that this has helped someone out there.
In 16 years, your rent has only been raised $60???? That is an increase of about 1/2 of 1%/year. Most properties need at least a 1 1/2% to 2%/year just to keep even with increases like insurance and taxes let alone maintenance.
I have a duplex and have been hit with an increase this year in insurance, with no claims, that amount to $37.50/unit/month. I have no way of raising the rent that much next year, but will raise a little each year to make up the difference. If renters take care of my rentals, I take care of them and do my best to keep them year after year. When something goes wrong in a unit, I have it fixed, if not the same day, then the next or ASAP.
As a landlord, I love a good tenant. A good tenant to me is one that pays the rent on time, keeps the property in good condition by letting me know as soon as possible that something needs repair, is trustworthy, respectful and courteous, and shows me that they care about me as a person, like I care about them.
My goal is to be good landlord, and I find it easier to be one if I have tenants I like from the start, and they like me. I find that that way, I get repairs done quickly, I know they are comfortable, and the property is being taken care of. All in all, as a landlord, my tenants and property tie for number one priority. If they're late with the rent once in a while, I don't mind because I like and trust them, and I know that we will work it out. Bottom line: I need them as much as they need me, and I don't want to forget that.
Florida legislators gave property insurers permission to cancel all muliple unit properties. I own 4 units and occupy one of them.
This permission by the state caused my inurance rates to go from $1800.00 to $4000.00 a year. Since I only rent out 3 units, I could not possibly pass this on to my tenants.
Due to the economy being the absolutely worst in Florida in my city and county, I had lowered my rents 3 years ago.
Talk about a no-win situtaion!!
I am 77 years old, have one of the best properties in my city, but Yikes! It is costing me my life savings to own this property. I have $700,000 invested in it and it is now assesed for taxes for $108,000. Talk about being "under-water".
I have tried to modify the mortgage (lowering the 7.25% interest) to no avail. Thank you PNC.)
I absolutely do not know what to do next. I have wonderful tenants who are also my neighbors. I raised each rent $25.00 a month. They all stayed!! But I cannot do it again this year.
I have been a landlord in this town for 51 years. How sad to end it this way!!
Indeed my two greatest joys were when I lost a tenant because they bought a home. And when a tenant rented their first apartment from me and I could teach them their teants rights!!