Hell-Bent on Low Rent

With mortgage financing harder to secure and job futures remaining unpredictable, renting has become the suitable option for many people seeking short- or long-term shelter.

But according to the Consumer Price Index, tracked by the Bureau of Labor and Statistics, prices for the lease of a primary residence have increased at an average rate of just over 3 percent annually over the past decade. Despite the fact that the cost of homeownership has decreased, uncertainty in the job market and other economic conditions have forced otherwise “would-be” homeowners to rent. And with increased demand comes higher rent prices.

Financial Planning

With finances tighter than ever for many renters, it’s important not only to shop around for the right leased property that fits their budget and their needs but to know how to negotiate with landlords to land the best deal.

For starters, it’s essential to establish what’s affordable, not only in monthly rent but in all the areas that constitute the true cost of living, including utilities, transportation and incidentals like laundry and parking. The common rule of thumb is that these expenses should be no more than 35 percent of monthly income.

Considering this rule, it may make sense to “rent down” – lease a unit that costs, for example, only 25 percent of one’s monthly income, says Evan Silverman, CEO of williampaid.com, an rental-payment service. This provides a cushion for paying down other bills and increasing emergency-fund savings.

Once a budget is determined, visit sites such like craigslist.org and apartmentfinder.com for listings, in addition to the real estate section of the local newspaper and its website. Also, google leasing companies or property management firms in the areas you’re interested in.

Most landlords know what their competition’s rent schedules are and have priced their apartments competitively. With this in mind, realize that many landlords may not negotiate their rental fees unless you’re willing to sign a long-term lease.

“You only need ask what, if any, specials are being offered,” says Steven Williams, a Philadelphia-based real estate attorney.

Landlord Lagniappes

Given the current economic climate, landlords want one thing, says Silverman: certainty that the rent will be paid. If dwellers are able to prepay some of the rent up front, agree to pay rent before the first of each month or commit to a longer lease, they may be able score a monthly rental discount or perhaps a month or two in free rent at the start of the lease.

As far as bargaining for a decreased rent, the most a renter should expect is 10 percent or $100 less a month, says Melissa Rulli, owner, Eye On Your Home, a home-monitoring service based in Fletcher, N.C.

From the landlord’s point of view, it’s always better to upgrade something than to provide rental-fee concessions. Instead, they can offer to repaint the unit or update the appliances, for example, which is a smart investment on their part. Landlords also might provide convenient payment options, such as accepting credit card payments.

In addition, landlords also can waive or reduce the security deposit, give the prospective tenant free or discounted pool/community amenity passes, and entice with incentives, such as lowered rent if you refer another tenant or monthly prize drawings for residents.