To celebrate the launch of RentPay, we’re doing the math on renting so you don’t have to. This article forms part of our series, The Ultimate Guide to Paying Your Rent & Winning at Life.
Found the place you want to rent? Whether you’re new to the game or looking to renew your lease for less, here’s how to bite the bullet and save yourself some cash.
Many people don’t realise that rent prices aren’t always fixed: there are many tactics you can use to negotiate a better deal.
Landlords and property managers will often list a property at a higher price than expected, anticipating you’ll try to negotiate. So is there a way to haggle your way to cheaper rent?
The short answer? Yes. It’s like the old saying: “You don’t ask, you don’t get”.
But be forewarned: There are smart ways to go about this. You don’t want to dive in headfirst, not knowing what you’re talking about. You could come out looking cheeky and risk antagonising the landlord. Heck, you could even land yourself a worse deal or lose the rental offer.
So here’s the deal. Be rational, be polite and, most importantly, be specific about what you want.
What you need to do is come up with a new weekly figure. For example, if you’re dealing with a proposed rent of $520/week, say, ‘I’d like to offer an application for 12 months at $490/week.’ They might disagree off the bat, but that’s where the negotiation begins.
That being said, semantics alone aren’t enough. You need to build a robust and convincing argument. That’s what the bulk of this article will help you develop. But first, let’s address the hot topic: COVID-19.
Renting during a pandemic
Who’d have thought we’d be writing that headline five years ago? There’s no doubt, COVID-19 has dealt a heavy blow to Australia’s economy and left many tenants with little option but to apply for rental assistance or government payments.
This doesn’t mean negotiating rent is off the table, but it does mean you need to play your cards carefully.
How to negotiate cheaper rent with your landlord and save yourself money
To do this successfully, you need solid and persuasive reasoning. You need to deal directly with the person closest to the property: either the property manager or the landlord.
Remember, negotiation isn’t just a mechanism for fleecing your future landlord – or an attempt to pay less than the property’s worth – it’s about earning that rent decrease. So how do you do that? Here goes.
Get up close and personal with your rental market
If you’ve ever rented in a hot market before, you’ll know that landlords and agents aren’t afraid to bump up the prices in line with housing trends. But if the area you’re in has an oversupply issue or is affected by economic factors, why shouldn’t you ask for a reduction?
Helpful tip: The Tenants Union of NSW has a Rent Tracker tool on its website. You can use this to look up your area and see how rental prices have changed in the past 12 months.
Suppose you’re proposing a lower rent price. In that case, you need to know that other landlords are charging for similar-sized rentals with comparable features/amenities in the same area. You can find all this information online, and you can ask around too. Make sure you present this as evidence when you approach your landlord to negotiate.
You should also keep things like demand in mind. If you’re renewing, realise that your landlord may have difficulty finding a new tenant – and that’s a decent incentive for them to want you to stay. The same applies if you’re a new tenant, too. If demand’s low, the landlord will be grateful to find someone and might be willing to negotiate.
TL;DR: (too long, didn’t read)
- Do your research ahead of time. How do surrounding apartments compare?
- A lower rate in a similar apartment is a great tool to negotiate
- Keep the rental market conditions in mind to avoid losing a good place
Sell yourself as the perfect tenant
Good references can go a long way. Present a compelling story that shows you pay your rent on time, that you’re clean and respectful of the property. If you don’t smoke inside or make unreasonable noise, get along with your neighbours and don’t have a tendency to hide pets, you’re probably a great tenant.
Having a good credit rating will never go amiss either. So if you’ve got it, flaunt it. And remember, there are ways to improve your credit score to make life easier for you in future.
- A letter (or two) of recommendation won’t go astray
- Get references that say you pay your rent on time and don’t cause issues
- Remind your PM about your positive rental history
There’s a delicate balance between asking for a fair deal and pushing too much, but it’s fair that you want enough of a cut to notice the difference each month. Go in expecting you may have a fair bit of back and forth with your agent while they relay messages to your landlord. It could take days or weeks for an answer – and plenty of patience.
They may come back asking you to meet them halfway, which could work, or to sign a longer lease at a reduced rate. No matter what, be polite, understanding and thank the landlord/agent for considering your request.
- Don’t ask for too big a cut if it’s not realistic
- Consider your situation and whether you’d be happy to stay for longer if you’re offered the discount
- Keep the conversation friendly and be patient – discussion takes time
Look after yourself
No matter the outcome, make sure you’re not leaving yourself in a tricky spot.
- Don’t ask for a rent cut if you haven’t done your research and don’t have numbers to back you up.
- Be the kind of tenant a landlord wants to keep. Keep paying your rent on time and keep your property in great condition.
- Look at how many people are showing up for inspections for the property. If there are 30-40 attending, you may not get the result you want.
Remember, you can ask for and negotiate anything – including rent. If you’re a good tenant, be persuasive and ask for what you want and need, and there’s a better chance you can negotiate the terms.