How I lowered my rent by 20% during Covid-19—and what experts say about negotiating with your landlord

Wealth

With a pending eviction crisis on the table, due to the economic impact of the coronavirus pandemic, both renters and landlords are on edge. 

But there may be a silver lining for some tenants who have their leases up for renewal. “Depending on your financial situation, a good time to start renegotiating a lease would be about 30 to 45 days before it ends,” says Gill Chowdhury, an agent with Broker Warburg Realty.

I took that advice in June, about two months before the end of my lease agreement. While not all landlords are willing to budge, I’m grateful I was able to lower the monthly rent for my shared apartment in Brooklyn, New York by 20% (from $990 to $790).

Here’s how I did it, along with some expert tips to keep in mind during the negotiation process:

1. Get to know your landlord

“Understanding who your landlord is will help you gauge how successful your conversation will be,” says Mark Hakim, a real estate attorney at Schwartz Sladkus Reich Greenberg Atlas LLP.

“In most circumstances, a small ‘mom-and-pop’ landlord might be more open to negotiating,” he explains, “whereas a large management company might not.”

My landlord owns just one building, which she and her partner paid off in 2016. They are very responsive and always act quickly to fix something if it’s broken.

I’ve only been their tenant for about a year, but I often make an effort for small talk whenever we pass each other in the hallway. This can go a long way in establishing a friendly relationship.

2. Look up comparable listings

To get an idea of how much I might be able to lower my rent by, I did an online search and compared prices for similar rentals in my area (and in my own building).

“If you see several listings priced for around $200 less than your current monthly rent, then that’s a good point of reference of what you can ask for,” says Joseph Fan, a real estate broker in New York.

StreetEasy is standard for New Yorkers. If you live with roommates, SpareRoom has data for several cities, including Austin, Detroit, Baltimore, Los Angeles and Seattle. And Zillow has listings across the country.

It’s also smart to look at how long a listing has been on the market, adds Fan. Since most people prefer to move during the summer, “it may be harder to rent out apartments closer to the fall and winter,” he says. “Landlords will want to get ahead of that.”

3. Review your financial situation

Be realistic about how much rent you’re able to afford, advises Jamie Gayton, an executive at PenFed Credit Union.

Let’s say your landlord agrees to lower your rent: Will you be able to commit to that amount throughout the end of your new lease? If not, consider other options, like asking for a month-to-month agreement.

Also keep in mind that these are financially rough times, so it doesn’t hurt to have an honest conversation with your landlord about your finances.

“If things shift during the pandemic, propose an action plan,” says Gayton. “Depending on your situation, your landlord may be willing to work with you to find a solution.”

4. Be ‘upfront, honest and reasonable’ with your landlord

I reached out to my landlord via phone. I reminded her of my tenant history and explained how the pandemic was affecting my finances. I asked for a $250 reduction, and while she initially said she’d agree to $150, we finally met in the middle at $200.

If you contact your landlord by email, be sure to include links to comparable listings that back up the amount you’re asking to reduce your rent by, says Gina Martino, a landlord who owns several buildings in Southern California.

“I wasn’t surprised when tenants reached out asking to negotiate their rent,” she says. And while are no guarantees that things will go as planned, Martino’s top advice for tenants is to be “upfront, honest and reasonable.”

Andy Hirschfeld is a freelance journalist based in New York, covering finance, business, tech and politics. He has reported for The New York Observer, Fortune, CNN, Bloomberg and CBS News. Follow him on Twitter @andyreports.

Don’t miss:

Check out: CNBC Make It is NOW STREAMING on Peacock. Find our original programming in the Channels section.

Products You May Like

Articles You May Like

Top financial advisor: 7 life and money lessons every young adult needs to know
Medicare beneficiaries might get $200 to help with drug costs. Here’s what we know so far
How one Michelin-star restaurant is reopening its New York City dining room
Goldman Sachs CEO shuffles consumer banking, wealth management leaders
Market’s wild swings should fade because true fear is absent, Allianz Global’s Mona Mahajan predicts

Leave a Reply

Your email address will not be published. Required fields are marked *