Rent decreased even Lower than last year lease

[Alex Moazeni]

Hi.

I have a rental in McKinney tx.

I rent it out back in 2022 for $2300 and the increase it on 2023 to $2400.

It's been the same tenant and it is time for renewal.

She is asking if I can do $2200 and if not she will move out.

Would you Lower the rent by $200 per month?

Any idea will be appreciated in advance.

[Kevin Sobilo]

@Alex Moazeni, what are comparable rentals renting for? That is the barometer here.

If rents are strong and support your $2400 rental price and you know you could readily secure a replacement tenant at that price, why negotiate?!? Even if she leaves and you lose some rent to vacancy, you will more than make it up if your average tenant stays 2+ years as they should be. If it takes 1 month to have a new tenant in place you will lose $2400 but that will be paid back in 12 months. So, even if the tenant only stays 24 months at that rental rate you are $2400 ahead.

However, if rents are softening where you are, then you may wish to consider negotiating with her. You could offer a $100 reduction or even a 2 year lease with year 1 at $2200 and year 2 at $2300.