Can you negotiate rent?
Have you ever asked about the possibility of lowering the asking monthly rent on an apartment you’re interested in leasing? It’s only natural to ask, and it happens countless times each day; prospective renters tour an apartment, decide they like it, and begin to ask if the neighbors are loud, if there’s street noise, how much the utility bills average as well as the inevitable “Is the rent is negotiable?”.
Then, if you’re like us, you’ve likely grown accustomed to being politely told “No” that the asking rent is not negotiable. There’s a good reason for this, and it doesn’t mean that you can’t negotiate a better price. Even though landlords may be having a harder time filling vacancies, the amount of interest and foot traffic for most properties remains high. This means that most landlords won’t entertain an offer or begin negotiating a discounted monthly rent until you’ve proven yourself to be a qualified candidate with serious intentions. Here are seven tips on what to do to ensure you have the best shot at negotiating a better deal.
When should you start negotiating the apartment rent?
You can start to negotiate the rent at various times, but it’s best to do so when you submit your application. The first thing a landlord wants to see is that you are a serious and qualified candidate. Why would the landlord start to negotiate the rent and entertain any offers you submit before even knowing if you’d make a good tenant? Requests to discount or negotiate the rent are almost always dismissed unless accompanied by a completed rental application and supporting paperwork. If you’re planning on renegotiating your lease when it renews, it’s best to start negotiations as early as possible, ideally as soon as you receive a renewal letter.
How To Negotiate Rent Tips
Whether you are looking at an apartment, a condo, a single-family home, or if your landlord is trying to raise the rent, there are a few things you should consider to help negotiate a lower rent.
Here are the best tips on how to negotiate rent and ensure you get a great price on your apartment lease.
Ask the landlord
Start a conversation with your landlord or potential landlord about rent prices. Be respectful, and ask whether or not they are willing to come down on the monthly rent. Make sure you know who you are talking to as well. If you are looking at a place owned or managed by a large corporation, it is less likely that they will come down on rent compared to an individual owner.
Come Prepared
Make sure you have your paperwork (PropertyClub’s NYC apartment application checklist) in order before starting to see apartments. This way, you’ll be prepared to act quickly if something catches your eye. If you’re worried about paying application fees before an offer is accepted, ask to submit an offer along with some paperwork showing your employment status and income. This way, you’ll prove to the landlord that you are a serious candidate with a genuine intent to rent the apartment. If an offer is accepted, be prepared to leave a “Good Faith Deposit” with the landlord while your application is being considered and the lease being prepared.
Prove that you are a serious tenant
Aside from coming prepared with the proper paperwork, there are other ways you can prove your worth as a potential tenant as well. This might mean signing a longer lease, conceding certain concessions offered by the landlord, or paying for several months (or the entire lease, if possible) upfront. You can highlight your past experience as a tenant and how you never missed a payment, always kept your apartment looking sharp, and didn't throw massive parties. You might even include references to former landlords so that the new landlord can do some investigating. Whatever it is for you, make sure the landlord knows that you are a reliable tenant.
Pay Your Rent Upfront
Offer to pay your rent up-front. If the building isn’t rent-stabilized and the land can accept up-front payment, it can usually lead to a decent saving for you. Large landlords might only give you a small 2-3% discount for paying up-front, but smaller landlords may offer a more considerable discount as high as 5 or even 10% off the yearly rent.
Rent a condo or in a new development
If you rent in a condo, you’ll likely be renting directly from an individual unit owner, and you’ll have more negotiating power. Remember that condos usually come with higher move-in, application, and brokerage fees, so the price is generally lower on a per month basis to take into account those costs.
New developments have hundreds of units to fill, and having them sit on the market means lost revenue for the landlord. This makes them prime targets for concessions. One or even two months of free rent are not uncommon when renting in a new development.
Do your research and be reasonable
Do your research on the apartment and the rental market to make sure you know what the property is valued at. Check market value for nearby houses or apartments. Look into what others are paying at this or similar properties. If your price appears to be higher, you may have a reasonable case for reduced rent. If not, then your plea will likely be rejected. If it appears that the place is empty or that the landlord is hurting for tenants, you might be able to work out some sort of agreement. Maybe a referral program that includes a rent reduction for each successful candidate could mean big savings for you!
It’s important to note that there are some landlords out there that do not wish to budge on their asking price at all. To them, an offer that is $100 less than they want may not even be good enough to be considered. Or, in the case of some larger landlords, the on-site agent or manager will be unable to approve such an offer. To get around this, try to negotiate a small rent discount, say $50. It will be much harder for a landlord to pass up on a deal if you’re so close to their asking price, and you’ll still be saving some money.
Be Flexible
If the landlord doesn’t want to offer you a lower rent, ask for a concession (like a free month of rent). It might seem unintuitive, but for a variety of reasons, many landlords would rather give you a free month of rent rather than giving you a $100 discount (even if the free rent equates to a $200-300 net discount). If a rent concession is off the table, maybe ask for a gym membership.
You can also offer to move in immediately as the landlord probably doesn’t want the apartment sitting vacant.
Rent during winter/low season
If you’re interested in the best selection available as well as pleasant apartment viewing weather, late spring and early summer are the best times for apartment hunting. But if what you want is the best possible price, winter is the season to score the best apartment deals in NYC. The market is slow, and inventory lingers, meaning that concessions and offers abound. Winter is when you’ll find the best selection of no-fee apartments as well as free rent concessions.
Extend the lease term
Rather than leasing for the conventional 9-12 months, you can also offer a term that is advantageous to the landlord, such as an 18 month or 2-year lease or even a lease ending in summer. They may come down a bit on rent in this case since the longer lease is ideal for their cash flow. Of course, this scenario has to work for you. Committing to an apartment for 2 full years can be intimidating, but if you know you will be in the area and you like the place, this can be a great option to save. And beware that if your lease ends in summer, you’ll likely end up paying more for your next place.
Remain calm and patient
If the landlord does not appear to be budging on rent, don’t lose hope. And certainly don’t lose your temper. The landlord has the final say on the rental price, so if you are truly unhappy with the price you can find somewhere else that might be more affordable. But getting upset or impatient with the landlord is almost a guarantee that the landlord won’t come down.
Instead, remain calm and patient. Make your intentions clear. If you are going to find a different place because of the current price, make sure the landlord knows. Perhaps he or she just needs some extra time to think everything through before lowering the price. The landlord doesn’t want to appear cheap or start conceding on the rental price with all his or her tenants.
Have a backup plan
The best thing you can do is have a backup plan in place. If the rental price is too high, make sure you are still checking out other locations so that you are not left stranded if the landlord declines your request. Take a tour of those other locations and start asking about their rental pricing and included features and amenities. If one landlord says no or is slow to respond, then you will at least have other options to fall back on.
Negotiating Rental Price as an Existing Tenant
If you’ve received a rent increase notice and want to negotiate your rent, the first thing to keep in mind is that timing is everything. You’ll want to start the process of negotiating the rental price early. It’s also vital to think about when the lease is renewing, and what are other rental apartments going for? If you’re set to renew in the winter, or if the market is soft, you might have a bit more negotiating power. Otherwise, you probably won’t have much leverage, especially if you’re negotiating with a management company. They’ll likely take any your desire to renegotiate as a sign that you’d like to stay, and will often bet on the fact that you’d prefer to avoid the inconvenience of moving. If you’re renting directly from a condo owner or smaller landlord, you might have more leverage, especially if you’ve been a good tenant. In this scenario, they’d likely rather give you a rent discount as you provide them with a reliable income stream, as opposed to rolling the dice on a new tenant, and also having to deal with the costs associated with turning the apartment over and finding another renter.
Is it even worth negotiating rent?
Of course, if you get the rental price to come down then the answer financially speaking is yes. But is that price worth the negotiating process and all the headaches or uncertainty that come with it? The likely answer is yes.
Occasionally, the negotiating process may take a while. And if you are waiting for a decision from the landlord before possibly applying or negotiating with other places, this can be a stressful time. Usually, the landlord will be pretty straightforward. If he or she is open to the idea they may need a few days to set a price. Otherwise, they may be ready to reduce the price then and there or not.
The savings that can come from a simple ask can be huge for you. Even a modest $25 reduction in price means an annual savings of $300. A $50 reduction would be $600 in your pocket. And a whopping $100 reduction would mean an extra $1200 spending money. This money can be used for:
- Investment - an extra $50 or $100 a month could go a long way in the right accounts.
- Down payment on a house - after your current lease expires you can use the savings from your rent decrease to pay for a down payment on a house you can call your own.
- Debt - get rid of some of those student loans, credit card debt, or other bills you have outstanding.
- Treat yourself - or you can use your savings for a little getaway, a new computer, TV, or a new pair of shoes!