When it comes to lowering their monthly housing payments in the down economy, renters have homeowners beat.
Refinancing a mortgage requires plenty of paperwork, a stellar credit score and weeks of effort. But property owners faced with profit-sucking vacancies and cash-strapped tenants are increasingly willing to negotiate. According to a recent survey from rental property marketplace Rent.com1, 68% of landlords reported lowering rents or giving one or more months free to retain tenants.
Try these five strategies to cut your bill:
Research the market
Learning what other people in your building and neighborhood are paying for comparable properties can help you figure out whether you’re overpaying, and how much room you have to negotiate, says Steven Cohen, the president of consulting firm The Negotiation Skills Company, which helps clients negotiate for better deals. Ask other renters what they pay, check similar property listings on Craigslist2, and get a local comparison on RentoMeter.com3. Cohen’s daughter Abigail tried that tip and found that others in her neighborhood on New York’s Upper West Side were paying an average 20% less than she was for a studio apartment. She brought those figures to her landlord and ended up with a new lease this summer for $1,550 instead of $1,850 -- an 18% discount.
Play up qualifications
“If you aren’t a good tenant, you won’t have a strong case,” says Peggy Abkemeier, the president of Rent.com. “The landlord may not want to make concessions to get you or keep you in the unit.” Point out that you’ve always paid on time, have kept the property in great shape and haven’t had any complaints from neighbors. Renters hunting for a new place have less leverage here, but they can benefit from a reference from a previous landlord.
Take on a roommate
Obviously, the more people sharing your space the less rent you’ll pay. But landlords may also offer a break to fill under-housed units. When Eric Woodbury and two friends were apartment hunting in Medford, Mass., in July, one property manager offered them a three-bedroom unit for $2,000, or roughly $667 apiece. Or they could move into a $2,200 four-bedroom where one tenant was already in place, cutting the per-person rent to $550. “That was a big selling point for us,” he says.
Look beyond rent
If your landlord stands firm on the monthly rent, ask about other possibilities to cut costs. For example, you might negotiate for more utilities to be included or a discount on extras like storage space or parking. Rent.com found 38% of landlords were willing to reduce security deposits, and 8% relaxed pet policies (which typically include an extra security deposit).
Track vacancies
Turning over an apartment can cost a landlord thousands in upgrades, marketing and lost rent, Abkemeier says. If your building or community is looking more and more like a ghost town, you have plenty of leverage to negotiate. “I see and hear people moving out of my building all the time,” says Iris Karasick of New York City. Karasick already negotiated the rent on her one-bedroom on the Upper East Side down $100, to $2,155, earlier this year, and says she hopes the vacancies might help push it below $2,000 this fall. “I’m sure they’d rather have a good tenant in the apartment than have to hunt for someone new,” she says.
Refinancing a mortgage requires plenty of paperwork, a stellar credit score and weeks of effort. But property owners faced with profit-sucking vacancies and cash-strapped tenants are increasingly willing to negotiate. According to a recent survey from rental property marketplace Rent.com1, 68% of landlords reported lowering rents or giving one or more months free to retain tenants.
Try these five strategies to cut your bill:
Research the market
Learning what other people in your building and neighborhood are paying for comparable properties can help you figure out whether you’re overpaying, and how much room you have to negotiate, says Steven Cohen, the president of consulting firm The Negotiation Skills Company, which helps clients negotiate for better deals. Ask other renters what they pay, check similar property listings on Craigslist2, and get a local comparison on RentoMeter.com3. Cohen’s daughter Abigail tried that tip and found that others in her neighborhood on New York’s Upper West Side were paying an average 20% less than she was for a studio apartment. She brought those figures to her landlord and ended up with a new lease this summer for $1,550 instead of $1,850 -- an 18% discount.
Play up qualifications
“If you aren’t a good tenant, you won’t have a strong case,” says Peggy Abkemeier, the president of Rent.com. “The landlord may not want to make concessions to get you or keep you in the unit.” Point out that you’ve always paid on time, have kept the property in great shape and haven’t had any complaints from neighbors. Renters hunting for a new place have less leverage here, but they can benefit from a reference from a previous landlord.
Take on a roommate
Obviously, the more people sharing your space the less rent you’ll pay. But landlords may also offer a break to fill under-housed units. When Eric Woodbury and two friends were apartment hunting in Medford, Mass., in July, one property manager offered them a three-bedroom unit for $2,000, or roughly $667 apiece. Or they could move into a $2,200 four-bedroom where one tenant was already in place, cutting the per-person rent to $550. “That was a big selling point for us,” he says.
Look beyond rent
If your landlord stands firm on the monthly rent, ask about other possibilities to cut costs. For example, you might negotiate for more utilities to be included or a discount on extras like storage space or parking. Rent.com found 38% of landlords were willing to reduce security deposits, and 8% relaxed pet policies (which typically include an extra security deposit).
Track vacancies
Turning over an apartment can cost a landlord thousands in upgrades, marketing and lost rent, Abkemeier says. If your building or community is looking more and more like a ghost town, you have plenty of leverage to negotiate. “I see and hear people moving out of my building all the time,” says Iris Karasick of New York City. Karasick already negotiated the rent on her one-bedroom on the Upper East Side down $100, to $2,155, earlier this year, and says she hopes the vacancies might help push it below $2,000 this fall. “I’m sure they’d rather have a good tenant in the apartment than have to hunt for someone new,” she says.
URL for this article:http://www.smartmoney.com/personal-finance/real-estate/5-strategies-to-lower-your-rent-now/
Deal of the Day by Kelli B. Grant
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