# Negotiating Rental terms



## none (Jan 15, 2013)

So my wife and I got out official notice last night so I guess we are certainly moving out. I honestly think that we are really great tenants. We really have no interest in buying for the next 5 years and am looking for a long term rental.

I was hoping to get some insights about what rental terms are usually the most negotiable. Generally, how flexible are landlord about monthly rental rates if the tenants are really great? We are actually hoping to get out of this house before Christmas (we only have to give the landlord 10 days notice) because having christmas in a house we are about to get booted out from we think would be a bit depressing. If we can say move in the middle of the month (and assuming it's already past Dec 1st) is giving the remainder of the month free unreasonable? (b/c it's unlikely the place would be rented until Jan 1st anyway).

Anyway, any advice would be appreciated. Thanks.


----------



## Four Pillars (Apr 5, 2009)

I think you can try negotiating on anything. It's really a function of the rental market more than anything.

The potential landlord has no idea if you are a great tenant or not.


----------



## andrewf (Mar 1, 2010)

This is the downside of leaving on bad terms from your previous rental: you can't count on a good reference.


----------



## none (Jan 15, 2013)

Yeah, that a bit of a problem. Also, my wife and I have decided we want to get out ASAP and as we only have to give 10 days notice we are hoping for around Dec 10th. As our landlady would have to reimburse us for 2/3 of our Dec rent I think she may sabotage it - but who knows.

We do have a bargaining chip that we have a LOT of her stuff in our basement....... A basement she has limited access to so maybe we can be clear that it is in both parties best interest to not be jerks.

Anyway, there are some incredible places out there for what I think is extremely reasonable.

For a house we would consider to buy ($800K) the tipping point rental price assuming a 3% loss in real estate next year is about $6000 a month. We don't want to pay that much obviously but if the market is going to be flat or go down then I think we feel good about renting over buying at this point.


----------



## Sampson (Apr 3, 2009)

none said:


> Generally, how flexible are landlord about monthly rental rates if the tenants are really great?


I have never and will never negotiate on the monthly rental rate. I always post at or slightly below fair value. Despite what our parents told us, none of us are unique, there are plenty of good tenants in the pool.

The only time I would consider it is if there was an additional explicit contract outlining some type of work to be performed, upgrades to the unit etc.

@andrewf, I wouldn't worry so much about the reference anyway, there are plenty of other ways to determine if a tenant is trust worthy.


----------



## none (Jan 15, 2013)

Sampson, I agree if something is already prices to move there is little reason to lower your monthly rate.

If, however you found yourself on Dec 5th with an empty place, and a solid tenant wanted to move in Dec 15th, would you be willing to give the 2nd half of the month free to just get it over with? I assume that mid-month is almost impossible to rent so it wouldn't be much of an out of pocket. Is this just wishful thinking?


----------



## Sampson (Apr 3, 2009)

I still wouldn't. I have refused 'sub-optimal' tenants and left a unit vacant just to secure someone that plans to stay longer and is on paper, better.

By all means, as Mike points out, anything is negotiable. Leverage your story. I believe your wife is a Post-Doc right? You guys are highly educated, have a kid, are very stable, and are saving and looking to buy a house in the mid-term. To me as a landlord, that means stable income for 2-4 years. Half a months rent, or negotiating $100 off per month may or may not warrant the stability you will provide. Sell yourself, your goals, and how those tie with a landlords desire for trouble-free income for a long period of time.

Even in this scenario, I wouldn't discount my listed price, but I have not raised the rent for tenants I like.


----------



## none (Jan 15, 2013)

No my wife is a full professor, I'm still stumbling along finishing my PhD and yes we do have a kid.

We don't really have any interest in owning a house - it just doesn't do anything for us, we're happy to rent. This getting kicked out is certainly a pain in the butt but you get crazy neighbours and you get crazy landlords - such is life.

We'd like to find a place where we could stay for about 5 years (that's the average length of house stay for home owners as well). Anyway, my wife just got back from looking at the place and it's pretty blah so the search continues (which would be a lot more fun if it wasn't stressful).


----------



## MRT (Apr 8, 2013)

none, I've heard from other landlords who offer incentives to tenants, like a year-end rebate for paying on time each month. I wonder if that could be leveraged further by offering to pay the entire year in advance? I suspect that many landlords might welcome the opportunity to avoid default risk and obtain so much income in advance.

some people might criticize this as an unwise 'investment', depending on the rent reduction's 'return'; however, if you are covering the vast bulk of your shelter costs up front, you could dip in to liquid savings (likely earning a paltry return), knowing those expenses are covered.

Even a 5% break on rent would surpass the return on funds sitting in a GIC, HISA, etc. earning 2% at best.

anyone see issues with such a proposal?


----------



## none (Jan 15, 2013)

Because we're looking for a place around 2K-2500 range I would be fairly uncomfortable (and I would have to cash out an entire TFSA) to drop $30,000 on a rental place.

I find it hard to know what is 'fair value' of these rental because honestly, VERY few rentals are prices fairly based on current prices (meaning their very underpriced).


----------



## andrewf (Mar 1, 2010)

I dunno. I think landlords might be suspicious of someone willing to pay rent in advance.


----------



## lightcycle (Mar 24, 2012)

Also you are giving up a degree of leverage if the landlord decides to be sticky on any issues that might arise in the next year.


----------



## Ag Driver (Dec 13, 2012)

I negotiate absolutely everything. Retail, Whole Sale, Private, Admin Fee's, Deposits etc. 80 to 90% of the time I will have a waiver or a reduction in price by simply asking. I hardly ever pay full price. Call me frugal.

Personally, being new in the game as a landlord -- my agreements are negotiable and are modified to catered and accommodate both myself and the tenant(s). I have had 3 agreements to date, so take my opinion lightly  . Currently my entire house is rented until 31 JAN 14. I am currently settling a new deal for 01 May 14 as owner occupied with two room mates. The new tenants are willing to secure the position with a deposit, and it will be for a 2 year term thus I am happy to accommodate. I would rather have a a few months empty and secure long term tenant vs rushing to get it filled with potentially short term and/or bad tenants. I plan on allowing them to start the move in process early simply because the rooms will be vacant anyways. So why not? 

As for price point, my price point now is firm and set at the lowest number I am willing to accept. I am not "making money" on my room rentals, they are simply to supplement my expenses. That being said, when I initially put it on the market as a feeler -- it was set at $100 over the price I was looking for, as well as $100 over the average for the market price point. So, yes, my initial price point I was willing to negotiate.

Overall, I say it never hurts to ask!


----------



## none (Jan 15, 2013)

That's what I figure too, I don't think it can hurt to ask.

Where I live it's rent controlled so landlords are only allowed to increase rents on pace with inflation. I have no problem at all with a landlord raising my rent every year as if they don't, they are effectively giving me a rent cut.


----------



## Cdnwife (Sep 10, 2013)

We have a place in Vancouver and specifically looked for someone to come in on the 15th with a half month of rent and had a number of folks who were willing to do so. I would be surprised if anyone would give you a full month. I would at most give a few days. Perhaps you can get in for a half month.


----------



## Potato (Apr 3, 2009)

Everything is negotiable, but the base rate (especially if it's starting off as competitive) doesn't have much more than ~$50/mo to move in my experience. We've been able to negotiate longer leases (18 mo, 2 year) to start, no rent increases as long as we're there, adding a dishwasher to the kitchen, yard work, having the landlord pay for materials when we improved/repaired the house (not all at the same place).


----------



## none (Jan 15, 2013)

Well someone offered to rent me their Million dollar house for $2500 a month (they dropped it from $3200 a month). It was in the super fancy part of town but really it's just rich person suburbi-blah so we decided to pass on it.

I think we found a great place - they moved on rent which was nice. Still not cheap but sure as heck a lot cheaper than owning. Thank you landlord!


----------



## Sherlock (Apr 18, 2010)

Glad you found something. I negotiated when I foudn my condo, the owner wanted above-market for it and I simply pointed out that similar condos in the area were renting for less and he dropped the price. So it's possible.


----------



## none (Jan 15, 2013)

It was a tough slog finding a place simply because my wife wanted to be in the best part of town (we think anyway). There were LOTS of places for much cheaper but they were out in the burbs.

Also, rents here in Victoria are pretty floppy because I think some people are still willing to rent at 2005 prices and others want to rent at 2013 prices (which are debatable because of the ~10% drop in RE) the last couple years. We ran into a few people who were sitting on their houses I knew they hadn't been able to sell but basically wanted us to cover a good portion of their bloated mortgage. Yeah no, and that's why the house has been on the market for a few months - they're simply asking too much.

I did get an offer to rent a million plus house for $2500 -not sure how that makes any sense but we didn't even go see it. It was in the part of town full of mansions and nothing else -- who would want to live there?

Anyway, glad it's done. Thanks for the input everyone!


----------



## Just a Guy (Mar 27, 2012)

It depends on the market...renting is tough right now with high demand. The last few times I've advertised I had 6 or more applications within a few hours...no need for me to drop my rates. In slower times, you're probably more likely to get a deal.

As for your reputation as a "good" tenant, it's meaningless...references are faked all the time. In fact I usually get suspicious of ones that sound too good. Of course, if your other checks support them, you may have an advantage, but until renewal time comes, you don't have much to stand on.

Good tenants for me usually benefit in the longer term.


----------

