Whether you’re moving to a new city or you simply want to reduce your budget’s housing category, there are plenty of ways for tenants to potentially negotiate a lower monthly rate on their lease. This is best done at the beginning of a new lease or the end of one about to expire within 2-3 months. Here are some of the best strategies for securing a better price on the home you’re currently renting and save money on rent.
Virtual Comparison Shopping
If you’re moving soon, you’ve likely been comparison-shopping anyway. However, if your lease is up soon, then why not scope out potential options in your area (even if you’re 0% interested in leaving your current community)? Many of us compare prices on items at the grocery store, on Amazon, and pretty much every other area of our consumer lives – why not compare what you’re currently paying to what other properties are charging for similar rentals in the area?
Of course, it’s worth noting that you shouldn’t waste time comparing completely different places. Just as you wouldn’t go to a Porsche dealership and try to get a new convertible for the price of a Honda, a luxury apartment community with a rooftop pool and excellent resident amenities isn’t going to be thrilled if you try to negotiate a lower monthly rate based on what nearby complexes with fewer amenities or smaller spaces are charging.
You can save a lot of time by virtually touring nearby communities – many mid- to large-sized property management companies are offering more advanced virtual tour options during the pandemic – and compiling your information into a single document that you can reference when it comes time to ask your landlord for a better monthly rate on your lease.
Ask About Move-In Specials
If prices are generally the same in your area or there’s something unique about your community that can’t be easily replicated elsewhere (e.g., proximity to freeways, neighborhood walkability, local crime rates, etc.), then comparison-shopping might not do the trick for you.
However, you could still approach your landlord to ask about any move-in specials they have going on. They’re typically advertised for “new residents only,” but many landlords would rather keep you as a tenant than risk leaving the unit empty, so they may be willing to extend a move-in special to you as well for renewing the lease.
The value of the move-in special you could get will depend on several factors, including how many units are currently empty (more empty units typically lead to better move-in deals), local competition (what are similar communities offering?), short- and long-term economic predictions for the area, etc. Even if you think there’s no way they’d give you a move-in special as a current tenant, you never know! The worst that can happen from asking is them saying no, so what do you have to lose by inquiring?
Explain Your Situation Frankly
If there are no move-in specials, then you could potentially work with your landlord to work on a compromise that suits your individual needs and current situation. If you’re struggling to keep up with the monthly rent payments, tell them. If you’re concerned about your job’s stability and want to keep your costs low in the meantime to preserve your savings, then explain to your landlord that finances are tight (you don’t need to go into details) and you want to know if they can offer you a better monthly rate on your lease.
In most cases, you’ll need to be close to the end of your lease for this to have a chance at working, but again, you have nothing to lose from simply asking. People oftentimes think it’s an issue of pride to avoid admitting financial struggles, but you could be inadvertently locking yourself into a more expensive lease by not speaking up and figuring out other (possibly more affordable) options that may be available to you.
Save Money on Rent by Citing Your Track Record
If you’re a potential tenant, then it’s important to know upfront that many apartment communities seem generally uninterested in letters of recommendation or glowing references beyond using them as a simple mechanism to ensure you didn’t completely wreck your last place or go months without paying rent. In other words, citing your track record as an excellent tenant and member of the community likely won’t be very effective if you haven’t actually lived there yet.
However, if your lease is set to expire soon and you’re trying to decide whether to stay or move elsewhere, you could potentially get a better monthly rate by referring to your track record as a tenant. Do you pay rent in full, on time, every time? Are you generally quiet, clean, and respectful of your neighbors?
Do you maintain a clean home, drive safely around the community, and perhaps pick up trash or animal waste when you see it on the property? Any evidence you can reference to prove you’re a valuable member of the community would be undoubtedly useful when it comes to trying to persuade your landlord to offer you a better price on rent.
Don’t Accept the First Offer Immediately
Something that many people tend to do in negotiations is folding too soon. This tends to happen because people are uncomfortable when it comes to haggling and negotiating back and forth, so they cave as soon as they get an offer that seems reasonable, even if it wasn’t the best possible option they could’ve gotten.
So how can you avoid this? For one, don’t accept the first offer, at least not right away. Give yourself time to think about it (if you have the time to wait), which will also give your landlord time to consider what may happen if they lose you as a tenant (will the apartment sit empty and income-less for months?).
Be prepared to counter-offer, but also remember that this isn’t exactly like a car dealership; haggling tends to be much more restricted for tenants seeking apartments or other residential housing because consumer demand oftentimes overwhelms the supply of rentable properties. This means landlords are less likely to budge on price and help you save money on rent if there’s a chance they could find a tenant willing to pay full price within a relatively short timeframe.
Consider a Longer Lease
You can save money on rent by extending the lease term, at least with some property owners. Whereas month-to-month leases tend to be the most expensive because tenancy is less stable, longer-term leases ranging from 12-18 months tend to offer the best monthly rate because this guarantees the landlord will have a paying tenant occupying the unit for at least the next year or longer. This stability tends to be rewarded in the form of lower monthly payments, so be sure to ask your landlord about longer lease terms to maximize your monthly savings.
Negotiating is undoubtedly a skill that is essential for so many areas of personal finance management, yet it’s also one of the trickier skills to learn and do well. Fortunately, property owners are accustomed to tenants negotiating with them all the time (so the discomfort shouldn’t be there), though you’ll need to be more prepared by bringing any research, quotes, and other important information that could support your arguments in favor of lower monthly rent payments.
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