When we first moved to a new city at the height of the market crash in 2009, my husband and I noticed a huge number of ‘For Rent’ signs up, even in the nicest of neighborhoods.
As we began our search for a place to live, most landlords were visibly anxious, telling tales of recently unemployed tenants breaking their lease abruptly to move back in with their parents. Many management-run apartment buildings were offering move-in specials that waived rent for the first one or two months. We quickly realized there were cheap apartments for rent.
The situation opened our eyes to the vulnerability of the landlord, and taught us that we, as renters and responsible tenants, had a powerful advantage we had never realized before.
Landlords Need Renters
That’s right, without tenants, any rental real estate is a huge liability, and good tenants are hard to find. As obvious as it seems, we had never thought about it quite that way before.
We began to brainstorm ways in which we could maximize this advantage, and the happy ending is that we got a large place, in a better neighborhood than we ever thought we could afford, at below both the average rental price of the area AND below the original asking price.
In this article I hope to help others achieve the same success in finding a high quality, cheaply priced apartment in the neighborhood of their dreams.
When you begin looking keep in mind that most landlords and management companies ask for a rental price that is much higher than their bottom line. They do this because people do not challenge their price and they are free to laugh all the way to the bank, raising the rent at the end of each lease.
It is important to remember that the landlord has something you want and need, but so do you. You provide them with a consistent income, the ability to pay their mortgage, and free supervision of their property. You alert them to any plumbing or electrical problems, which saves them money later on expensive, extensive repairs.
Armed with this powerful perspective, an organized approach will maximize your results.
Know Your Goal
Before you begin to look at places, decide what you are able to pay with a minimum and maximum price. Think about all factors your dream apartment would have. How many bedrooms? How much light, which floor do you want to live on, pets or no pets, the list goes on. Be specific and think it through well. This will help to focus you and prevent you from jumping at a deal that is not ideal for you.
Begin to walk or drive through all neighborhoods you are interested in living in. Look for any ‘For Rent’ or “For Sale’ signs. If there are a lot, and especially if they look like they have been up for awhile, then you know that housing is abundant and tenants are rare, which gives the advantage to you. While you are there, look at the parking and note the access to buses and trains. The less convenient these things are, the more leverage you will have to pay less.
After you do your initial research, you may want to have a real estate agent show you a few of the available places in you area, but remember that real estate agents work on commission, some or all of which will be paid by you. If you want to avoid this expense, best to look on your own.
Do Background Research
Go online or call the local police precinct to find the crime statistics for neighborhoods you like. Look for any negative information, like burglaries, foreclosures, auto theft, or noise problems that can be brought up in a negotiation with a landlord. It also helps to be fairly sure the neighborhood you live in will be safe.
Find Places Free
Use craigslist, local pennysavers, community message boards and call the numbers on ‘For Rent’ signs to take the middle man out of the rental search equation. This takes the real estate fee off the table, and gives you a direct feel for how urgent the landlords are feeling about renting their places.
Look at a lot of places. Take your time. Be organized and record all the information, good and bad about each place you look at. Be judicious and discerning and use your poker face.
Prepare For Negotiation
When my husband and I were looking at apartments, I played the role of the gushing enthusiast – tantalizing the landlords with my readiness to move in – and my husband played the role of the pessimist, pointing out all the flaws and grousing about the price. This made several landlords much more open to meeting our demands. Remember, an apartment rented to likable and stable tenants at a lower price puts money in the landlord’s pocket and helps them sleep at night. An empty apartment, sitting open at the highest asking price is just an expensive liability and stress.
Look at many places and once you have found several you like, begin to use them against each other. For example, you might love one apartment but feel the price is too high. Tell the landlord of that apartment that you would like to move in, but have another place lined up for less then ask them if they can match it. Be prepared for the landlord to take their time about the decision if they do not say no right away. Be ready to walk away as well. This won’t work every time but it only needs to work once!
There are a few additional things you can do to entice landlords to give you what you want, though not everyone will be comfortable using them.
If you have savings there are a couple of ways to use it to your advantage. First, you can show bank statements, obviously with your account number blacked out, to potential landlords to reassure them of your capacity to pay rent. This is a bonus if you are employed, but can help if you are not, as I was when we moved. My husband had a job but I did not, yet I had a solid year’s worth of living expenses in the bank.
While I realize having a year’s worth of money on hand is a rare situation, having just a little cash on hand can help you too. After checking to be sure that the place you are looking at is not about to go into foreclosure, and drawing up a legally binding record of the offer I am about to explain, you can use a cash offer of one to three months worth of rent up front as a way to bargain for paying less on monthly rent. Be sure to protect yourself from eviction if you do this, and, as always, be ready to walk away if it does not succeed.
As you adjust your attitude and go through all the steps of negotiating remember that this is a process that takes time and discipline. Stick to your original goals, and always offer your minimum first so you have room to comfortably go up. Do not compromise on your original goals and always be ready to drop the deal, in appearance if not in truth. This is the only way to make this process work.
May the search for a cheap rental yield you a luxury apartment at a bargain price!
Although most of the information contained here is from personal experience, this website was very helpful to the writing and application of the activities in this article