Ever had tenant to negotiate Rent before move-in?

Question

Had a potential tenant/roommate once ask me to rent a room $250 bills paid. Laughable price, and a part-time job flipping fries could afford more than that. And, of course, the whole "they're making unreasonable requests before they even move in" thing.

That $250 ABP request made me giggle. That wouldn't even pay half the electric. Obviously a NO, plus a laugh.

Have you ever had tenants try to negotiate rent prices before moving in?

Would you ever consider lowering rent by any amount-- whether ridiculously low like I was asked, or, say, $20 off a month?

Cheryl C. · Answer

Here is a recent example of me giving a rental applicant a pretty decent break.  I had some tenant bail on me (he said it was a military transfer but wouldn't provide the orders).  I had an older couple look at it and the wife REALLY wanted it.  They had been at their last rental almost 30yrs and only moved because someone died and the heirs were selling.  Since they were staying with their son they could move in in 4 days (little lost rent), no upgrades and no agent fee.

The husband is a retired postal worker and a very handy guy.  The problem is that the husband is the type of guy who wanted a "deal".  I took 10% off for a three year lease.  They have been there 6 months and love it - it's a small beach community with alot of retiree's.  I know (and knew) that they will stay for as long as they live.

Brandon McTurner · Answer

I would prefer they ask prior to moving in. This way you can get a agreement ironed out and in writing (rental agreement). The answer is typically no however in some instances I have made concessions to great tenants. Here is a trick I like to use:

When a potential or current tenant asks for anything that is not provided in the lease I immediately counter with a concession on their behalf

Example

Tenant: I would really like to move in but I need the rent reduced by $50

Landlord: I may be able to work with you on a $25 per month rebate at the end of the year if all 12 months are paid on time

or

Landlord: I can reduce the rent by $30 a month if you commit to a 3yr lease instead of a 1 year

Please note these are just examples and you can ask for any concessions you feel are a appropriate counter to your tenants request. If you ask them for something every time they attempt to change the terms of your written or verbal agreements you will notice a big change in the demands (and frequency of demands) they approach you with. I hope this strategy helps as it has served me well

Tim Czarkowski · Answer

I've had a few people ask about reducing the rent over the phone before looking at the place but surprisingly have never had anyone ask while looking at the place before signing a lease. Certainly once the lease is signed I wouldn't negotiate.

The last place I rented before I bought my house we got the guy to come down from $900 to $800 and throw in a last month free deal. I think he was a little high on his rent in the first place.

If someone appeared to be a good tenant I might be willing to cut them a little break but not much.

Jon K. · Answer

I've been doing month to month leases.

Even if I get a 3 year tenant, couldn't they walk away anyway?

Isn't a long-term lease more binding on me than on them?

Unless it was a well-paid, collectable tenant... even then, seems messy and unsure whether I would collect rent if they walk away. I could sue for rent, but if tenants live check to check, would I ever really see the money if they walk away from a 3 year lease?

Perhaps I could counter with some perk. The way I see it with mine: they're paying such a trivial amount for this neighborhood that they can like it or move on. I should work on increasing rent.

The person who asked to lower it lowballed ridiculously ($250 ABP).

I do hate turnover.

Cheryl C. · Answer

Bienes  Raices, no I don't worry about that at all.  I check them out pretty well and if things go south, I'll straighten them out quick or evict depending on the issue.  Turnover is a killer and a tenant on a one year lease can trash a place or be a pain just as easily.

Bienes Raices · Answer

When you guys give two or three year leases, aren't you concerned that the tenants could turn out to be duds and you will be stuck with them for a long period of time?

James H. · Answer

I would rather just let that potential applicant move on and then lower rent and re-advertise if I thought it was needed. I don't like the idea of lowering the monthly rent as a negotiation and then that same applicant/tenant think that everything else is up for negotiation during their lease term.

I have had some potential applicants make a half hearted attempt at negotiation. As Bienes  Raices said, it could be an indication of being overpriced, but I wouldn't start lowering rent right away just because someone asked. Even if I do lower the rent, it won't be part of an active negotiation. But then again, I offer great value of what I charge, so there is no need.

Steve Babiak · Answer

It happens, usually before I take any application.  I suggest that my prices are fair, and that they should let me know if they come across anybody in that immediate vicinity with a better value / deal.  If they really lowball (a few were asking like $300 off) I suggest that there are other neighborhoods where they can find a place at that price, and then I tell them those neighborhoods (in the "hood").

If I am running out of prospects, I will offer a $25 or even a $50 reduction, but that would be for a very short term (like 6 months) only, after which an increase would be expected.

Cheryl C. · Answer

I have some once in a while.  I may give them a slight discount for a 2 yr lease or if I believe that they will be an exceptionally good tenant.  The rental market is very tight in my area (amazing for November!).  There is no need for me to discount or negotiate.  There are many excellent applicants.

Bienes Raices · Answer

I've had a lot of them do that. If a lot of people are trying that it can be a signal that you've priced the rental too high.

Ever had tenant to negotiate Rent before move-in?

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