If you’re prepared and confident you are a good chance of getting a favourable result from your rental discussions.
Whether you’re looking for a new place to rent or it’s time to renew your lease, now might be a great time to consider negotiating your rent. “There should always be some wiggle room, and it’s worth a shot now more than ever,” says Joe Ewaskiw, a spokesman for the consumer Web site ApartmentRatings.com.
But before you march up to your landlord and demand a lower monthly tab, here are a few steps that will help you get a favourable outcome from your discussions.
Know Your Stuff
Collect information about your landlord. This requires research. Figure out what other tenants in your building or neighbourhood are paying. Understand the rental market in your neighbourhood, city and state. “Landlords say this is how they set rents themselves,” says Ewaskiw. Once you understand the facts, you can determine whether or not it’s realistic to ask for a lower rent and, if so, how low you can go. But avoid making an offer that is too low, should you offend the landlord.
Finding the information you need may take a bit of time and effort. Check out local open houses, talk to neighbours and scan classifieds. You can also hire a broker, someone who helps connect a buyer and a seller, if you’re looking for a new place.
Timing Is Essential
In any negotiation, timing is essential. “Eighty percent of concessions come in the last 20% of time left to negotiate,” says Roger Dawson, author of Secrets of Power Negotiating.
If you’re looking for a new apartment, it may work in your favour to approach the landlord with your new offer at the last minute. An owner may be more likely to agree on a lower rent if it’s near the end of the month and he or she still hasn’t found any renters, or if the apartment has stood empty for a few months already. Sometimes a landlord would rather accept a lower offer than risk losing money on an empty apartment. The time of year can help or hinder your negotiations as well. For example, if you’re looking to rent in a beach community right before summer, you may not get such a great deal.
If you already have a lease, give yourself a bit more time between when you begin your negotiations and when your lease expires. You want your landlord to know that if negotiations don’t go your way, you still have time to find a new place (and you will want this time as well).
Know Your Options
Know what your options are if you don’t get the price you’re asking for. Will you have to move out or just suck it up? Then look at your landlord’s options if he or she doesn’t agree on your price and you leave. Can he or she easily find a new tenant? How much will it cost if you move out and he or she has to go through the process of cleaning and fixing up the apartment for a new tenant, compared with the money lost in your lower offer?
“Look at the alternatives each side has,” says Dawson. “The side with the most alternatives can use time pressure.” Alternatively, the side with the least alternatives has less power.
Even if you don’t have many options, you can still be a successful negotiator. “Negotiators don’t deal in reality, they deal with perceptions,” says Dawson. Be mentally prepared. Many Australians are not used to negotiating; it’s done in a casual way less in our society than others. “You’ve got to be comfortable going into a situation where you don’t know how the result is going to turn out.”
Ask for a lower price than you know you’re going to get, and never take the first offer. If it’s clear that your landlord won’t settle on a lower price (or it’s clear by your research that asking for a lower price is completely unreasonable) then find other ways to negotiate. Ask for free parking or a fresh coat of paint. If you’ve done thorough research, you should know what may be most beneficial to your landlord.
Sometimes landlords will lower rent a bit if you promise to pay before the first of the month, says Kathy Hertzog, president of Landlord Association.Org. Hertzog has also found that many landlords are putting more effort into finding quality tenants. Having a good credit score or references from past landlords may help you convince the landlord it’s worth lowering the rent to keep you as a tenant.
When you’re going into a negotiation, remember that it’s another person you’re talking to. Play to their needs. Be open-minded and flexible, but aggressive and steadfast at the same time. Also keep in mind that eventually the market will probably come back and landlords may be able to raise rent again. If you sign a lease, you are guaranteed the rent you agree upon in your negotiations, but eventually your lease will expire and the landlord may boost the rent up substantially.
Even if you think you have no chance of getting your rent lowered, if you’re prepared and confident you will probably walk away with something. Hey, it never hurts to ask.
Source: Yahoo Finance