From how to prepare to what to say, here is everything you need to know to negotiate a lease
You’re searching for a new apartment, you’ve been using our apartment hunting cheat sheet, and you’ve finally found a great one. Big windows, roof access, there’s even a jacuzzi tub, but it’s a bit pricier than you were hoping for. Like most of us you may begin to wonder, “should I try to negotiate the lease?” And then like most of us you probably think “I’m no Kevin Spacey (or ‘space captain turned Priceline spokesperson’), I can’t negotiate a lease” and just fork over your hard earned money and get on with your life. Well, no more! It’s time for you to start working on those negotiation skills.
Follow this decision guide to help decide if you should negotiate your lease
First Up: Should You Bother?
Obvious answer: it depends. The first thing to look at when deciding to negotiate a lease is how large the property manager of the building is. Larger property managers, and even landlords, often have too many apartments to be able to offer custom negotiated leases. So more often than not, a policy is set in place and that’s that. This means tenants may have a lot less options when it comes to negotiating.
“If (a landlord) has got 2000 apartments and ends up having to negotiate each deal, it’s going to be a lot better for that person just set a policy” -Chris Frutkin, City Center Apartments
The second question to consider is is this a competitive rental market, or are there tons of places with “For Rent” signs collecting dust? If it’s the former, then it’s probably not worth your time to try and negotiate, and if you try too hard, then you may get flagged as a high maintenance tenant and suddenly find the landlord stops returning your calls.
“As with any negotiation, you need to be willing to walk away. If you’re not willing to walk away, then you’ve already lost.” -Joe Cirillo, Your Local Leasing Company
This goes for college towns, too. More often than not they are crowded markets, and real estate goes fast. Of course, if you tread lightly and follow a few guidelines, pretty much every landlord we spoke with say “It’s worth a try.”
So you’re going to bother, now what?
“In order to negotiate, you need to know what the product or service is that you’re looking for. If you do not have any information, it’s a recipe for disaster when you’re trying to negotiate.” -Bruce Feldman, New York City real estate consultant
Bottom line, do your homework. Going into the negotiation process having done research on the rental market in your area gives you a great advantage. Knowing about comparable properties can make all the difference. Take advantage of tools like Zillow
, and Rentenna
, which can help make this process very easy. On top of that, do some leg work, see some similar places in the area, and get a good understanding of what is reasonable to be paying. If the apartment is at or above average rental prices, then you have a good reason to go on to the next step.
Done your homework? Now Get Lookin’ Good
Sure, you may always keep your apartment super clean and keep the noise at a minimum, but how are you going to prove this to a new landlord or management company? You’re an awesome tenant, so let’s make sure they know that.
“Landlords are looking for strong tenants; stable employment. With experience, (landlords) can begin to tell within a few minutes of meeting a potential tenant if they’re going to be a good one.” -Bruce Feldman, New York City real estate consultant
So, what does that mean for you? Clean out your car (if you’ve driven one to the leasing office or viewing, then there’s a chance they’ll take a look to see how clean you are!), dress nicely, and be knowledgeable. Having a record of your past rent payments can also help your case. If you pay your rent online
with a service like RentShare, you’ll get just that. Now here is a good life lesson for you. Don’t be knowledgeable by saying lots of stuff, be knowledgeable by asking great questions.
This demonstrates your knowledge and lets the landlord know you mean business. Here are a few good, simple, questions to make sure to ask:
- What’s the neighborhood like? Safe?
- Can you tell me about the neighbors I’d have in the building?
- Do you like to see references from old landlords? (assuming you can get them)
Start the Conversation
So you’ve decided you’re going to give it a go, you’ve done your homework, and you put on a clean shirt. Now the big questions is, “how do you start the conversation?” The goal here, for most of us, will be to see if negotiating is an option, without ruining our chance of getting the apartment or being forcibly removed from the premisses.
“It comes down to three things, keeping an equal business stature, keeping them ‘OK’, and keeping a solid mindstate.” -Rich Geise, sales and negotiation expert
So the question here is, “is it up for discussion.” If it’s not, it’s not, you’re ok with that, and if it is, then you can talk about what that means. A simple question to ask is ‘are you fixed on the price?” Try blending it in with your other questions, and always be supportive of the answer, especially if it’s “yes, it’s fixed.” The conversation may go like this:
You: Are utilities included? Landlord: Gas and water, you pay electric. You: And the rent amount, is that pretty fixed in stone? Landlord: Yeah, sorry. You: Sure, I figured so. And you probably don’t typically do any discounts for signing a longer lease or anything. right. Landlord: No, sorry. You: No problem, good to know.
Another great question to ask is “is there anything you look for in a tenant that would make you offer a discount?” Remember, the key here is to make it easy for them to say no, this keeps them comfortable and ensures you don’t burn any bridges.
They say “Yes, the lease has a little wiggle room.”
Remember all that homework you did? Now it’s time for that to pay off. If you have good reasons why the price should be lower, feel free to share it. Don’t argue, and don’t be critical of the apartment; if anything, be complementary, this is their property after all. Make it fair, and remember the ABC’s of negotiating – Always Be Cool.
Your Bargaining Chips
If you’re in love with a unit but it’s out of your price range, then you may have a few ways to sweeten the deal.
“Try offering first, last, and deposit. Our company loves this situation, and we are sure many other landlords would as well,” -Benjamin Hackett, District Properties, LLC
If you can’t offer more up front, then you may know you’ll be in the same place for a while? To some landlords, a longer lease can be very appealing, and earn you a break on rent. Many landlords like the idea of a longer lease because it means a longer commitment and a guaranteed cash flow for them. However, be aware that for some landlords offering to extend a lease may mean absolutely nothing, especially in a competitive market where rent prices have a tendency to increase from year to year.
Well that didn’t work, what else can I do?
In a lot of situations, it just won’t work out to negotiate your rent, so what can you do? You can re-negotiate the length of the lease AFTER you’ve lived in the place for a while.
“Once (a tenant has) established a good history with me, I absolutely want the tenant to renew. For how long is debatable. It depends on the market… In most cases, yes, I want people who pay on time and don’t give me a hassle to stay as long as possible.” -Anonymous Landlord
If you’ve been an outstanding tenant, you potentially have a lot more leverage when it comes time to renew your lease. Finding a new tenant can take months and cost thousands in lost rent, which means having a trusted renter stay on for a discount can look very appealing.
At the end of the day, asking about negotiating a lease shouldn’t be a big deal; it’s always worth asking when done right.
“Be professional and honest. Most landlords are normal people with normal lives who just want a tenant who pays rent on time, doesn’t complain about minor stuff, and doesn’t damage the property. Just be professional and don’t act like you own the property, because, well… you don’t.” -Anonymous Landlord