There’s this super cute meme that makes rounds every once in a while.
It has a different woman looking all tough in the background every time it makes an appearance, but it has the same words almost verbatim every time:
You’re asking if I can negotiate my fees? Yeah, sure, honey, let me just go see if my landlord will negotiate my rent.
I get the point – on a month-to-month basis in the middle of a twelve-month contract, you can’t negotiate the rent with your landlord. And you need to pay your bills so you shouldn’t give discounts to everyone who asks for them when you’re a service-based business.
I always walk away from that meme asking myself,
How do people not know they can negotiate their rent?
Because here’s the thing: Rent is totally negotiable.
You just have to know when and how to do it.
Know Your Landlord
The type of landlord you have determines what kind of negotiations you can expect to be successful. Whether you’re negotiating one-on-one with a landlord who owns a couple properties or with a large complex, there are ways to pursue the biggest bang for your buck through negotiation.
You can usually negotiate directly with individual landlords or property managers.
Negotiating your rent is going to be easiest with an individual landlord. Though you may also have success with a property manager who takes care of the rental for an individual landlord.
In these negotiations, you’re most likely to be able to reduce the dollars you pay in rent every month.
You can ask for discounts and insights from office staff at larger rental complexes.
If you are dealing with a landlord at a larger rental complex, it doesn’t hurt to try to negotiate the actual rent. But you are less likely to have success.
Instead, talk to someone in the main office. See if there are any discounts available. For example, a certain credit score might get your security deposit reduced. If you move in during a specific month you might get your first month for free. If you have a larger blended family and they want you in the door, maybe you could get more guests added to your pool pass.
You’re more likely to be able to negotiate perks and amenities with larger complexes than the actual rent. It’s going to be more about making friends at the front office and getting them to let you in on the discounts and hacks that already exist within the system they have established for their new tenants.
By all means attempt to respectfully negotiate rent. Especially if you’re negotiating at your lease renewal. But do expect a lower ratio of success than if you try to negotiate monthly payments with an individual landlord.
Know What You Can Afford
Before you go into negotiations, you need to know how much you can afford. Traditionally, it is recommended that your rent and housing expenses take up no more than 25%-30% of your monthly budget.
However, given the housing crisis which continues to afflict this country and the stagnation of wages in America over the past several decades, there’s rarely a way for the average American household to stay within the 25%-30% range and still have safe and healthy housing – especially in urban areas.
Because traditional advice is so broken and incongruent with our lived realities, you’re going to have to figure out what you can afford on your own. If you don’t yet have a budget, you can get a free month of budgeting software for an assist.
You’re probably going to have a hard time sticking within the 25%-30% rule, but you do need to figure out the absolute max you can afford to pay every month and still keep on top of your other bills.
You need this number because when you begin rent negotiations, you need to know where your ceiling is.
When you find it, you’ll need to walk away.
Know What You Want
What you can afford and what you want will be two different things. You want to pay less than you can afford, because that gives you more wiggle room in your budget. Believe it or not, this can actually make you a better tenant because you won’t be stressing as hard about making rent every month. If you manage your money right, it can make you more financially stable.
Maybe you can afford to pay $50 less per month than the asking price, but ideally you’d want to pay $100 less per month. If this is the case, you’d want to ask for more than $100 off per month as you start the negotiations, then work your way to your goal. Maybe you can afford $50 less per month, but they offer you $75 because you started with the goal of $100.
If the landlord refuses to take at least $50 off per month by the end of your negotiations, you can’t move in. Full-stop. You can’t afford it, and if you pretend you can, it’s not going to end well for you or the landlord.
Know why the landlord should negotiate with you.
You do need some leverage in order to be successful in negotiations. Here are some things that will make it easier to successfully negotiate your rent:
- Are you a good tenant? If you are negotiating with a new landlord, your credit score or history may be important. Landlords want to see you regularly pay the bills on time – including your rent. If you have recommendations from past landlords, this can help you, too.
- Do you have somewhere else to go? If this is the apartment that’s going to keep you from being homeless, you inherently have less room to negotiate. You can still delicately try, but the inability to walk away means the power dynamics are not in your favor.
- Time of year. It’s easier to find tenants in the summer. Tenants negotiating winter leases have more leverage. Usually a landlord would rather have someone in the property paying a little less than their asking price every month than have the property sit empty for months at a time.
- State laws. State laws can affect negotiations, too. For example, if you’re moving in March, but are trying to get a lower rate on your rent, you may offer to extend your lease to 15 months instead of 12 so that your renewal will be in the more desirable summer months for your landlord. However, maximum lease length varies depending on your state’s laws.
Don’t forget the amenities!
If you can’t get the landlord to come down on rent, see if you can negotiate additional amenities. Here are some of the top areas to consider for negotiation:
- Pet policies. If the property is pet-friendly but you don’t have a pet, see if you can get a discount on your security deposit. Your risk for damage is lower than what they’ve built into their pricing structure, and they may be willing to work with you.
- Laundry credit. If you’re running on coin-op laundry offered by the landlord, see if you can negotiate a laundry credit into your contract.
- Storage. If extra storage is a need, can you secure an extra or larger storage unit than what they’re already offering with the property?
- Parking. You may be able to negotiate any parking fees that are associated with the property. Even if one free spot comes with the property, is there a way to get an additional pass for guests?
- Upgrades. In larger complexes, renovations usually happen in phases. If the unit you’re looking at isn’t up to the same standards as others going for the same price, you may be able to negotiate lower monthly rent payments or demand those upgrades are made to your apartment before you move in.
Know When You’ll Walk Away
Before you start negotiations, you need to know when you’ll walk away. If you can only afford the rent with a $50/month deduction, be prepared to walk away if they come at you with a rent deduction of only $25/month.
If you cannot walk away, that’s good information to know walking into negotiations, too. It gives you a lot less leverage. But lying to yourself about the power dynamics is not going to make the situation better.
Know When to Make Your Ask
Calling up your landlord to negotiate rent when you’re already under contract is not going to work.
There are two times when you should consider negotiating your rent, though: Before you move in and when your lease expires.
Before you move in.
This is when you have the most leverage – depending on how many other people are showing serious interest in the property.
Before you move in, you’re going to have the most success negotiating a deduction in rent – especially with individual landlords. This is also the time when you’ll be able to negotiate the most amenities and perks into your contract.
This initial contract is likely to be the best deal you get from your landlord. Everything else moving forward will be negotiated with it in mind.
When your lease expires.
If you are a good tenant who has had few to zero complaints and has made on-time rent payments every month, you will have leverage when your lease expires. The negotiations will likely happen in the months before the expiration as your landlord either offers you a lease for the upcoming year – or doesn’t.
If they do and the terms are the same, you might not want to nickel-and-dime them to pay less.
Right or wrong, there’s a general expectation that property values go up over time – especially as safe and healthy housing becomes a scarcer resource. There’s also a general expectation that the landlord will raise the rent, even if the property value and/or taxes haven’t actually increased.
But it’s also the reality we live in.
If your landlord does up the rent or the cost of other amenities like laundry, tenants with a good history may want to negotiate.
Bear in mind that you have a little less leverage than when you moved in. Moving takes kinetic energy, and moving is the only real bargaining chip you have to force the landlord’s hand. If you threaten to walk away at the rent increase, you have to be prepared to actually do it.
Consider what’s currently on the market before you walk away.
You’ll also want to bear in mind what’s currently available on the market. I once lived in an apartment for almost a decade. By the time I moved out, rent had exploded in the market around me, almost doubling. I chose to stay in the same property for many years even though the rent nudged up higher as time went on.
Not because I was completely happy.
But because I could no longer afford to move and stay in the same area of the city where my family had built a life.
However, if you are willing and able to move at the expiration of your lease, you do have a lot of power. A good tenant can be hard to find, and the prospect of not finding any tenant can be scary for a landlord. In these situations, you may be able to negotiate rent increases to a minimum, especially if you’re already paying close to market value.
And remember: After you’ve made a deal, make sure to get every last thing in writing.