When it comes to real estate, is is much easier to negotiate over rent price than it is to negotiate over purchase price. This is because rental properties are owned outright by landlords and property managers instead of banks and real estate companies. Since the property they are renting out has already been bought, the owner of the property is more willing to negotiate. After all, if a landlord cannot find a tenant, he or she is not making a profit. Here are a few tips for negotiating rent price:
1. Do your research. Compile a list of similar properties for rent in the same area. These properties should be similar in regards to size, amenities, number of bathrooms and bedrooms, etc. By averaging all of the asking prices together, you can see if you have any leverage to negotiate. If the asking price for the property you are interested in is way out of line with other similar properties, then you have something to negotiate over. However, if the asking price is below the average, then it will be harder to negotiate.
2. How long has the property been on the market? If the same property has had a “For Rent” sign in front of it for several months, then it’s probably because the asking price is too high, or the property isn’t in the best condition. Also, if the same property seems to be up for rent a couple of times each year, it suggests that the landlord might not be the most likable person in the world.
3. Inspect the property. Meet with the owner and take a good look at the property. Take a notebook with you and make a note of anything that needs repaired. A cracked window or a draft under the door can raise your heating bills by hundreds of dollars. A small brown spot on a ceiling tile may indicate a leaking roof, and a mildewy and musty smell in the basement may indicate a leaky basement. The more repairs that need done, the more leverage you’ll have when negotiating a price.
4. Make your pitch. If you can show the owner that comparable properties in the local market are being rented at lower prices, and you have a laundry list of little problems that should be fixed, then you should have no problem at all convincing the owner to come down on the price or to make satisfactory repairs. Don’t be discouraged if the owner refuses to give ground, simply say “thanks but no thanks” and head for the door. At best, the owner will cave and give you a better deal, and at worst you have walked away from a landlord who is stubborn and is only concerned with profit.