4 Smart Moves To Save Money on Summer Rent Hikes
Written by
G. Brian Davis
Edited by
Cory Dudak
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More people move in the warm months, which means more leases renew — usually with a rent hike.
So how can renters soften or avoid the pinch of a rent hike this year? Read on to find out how you can attempt to save yourself money.
Negotiate a Lower (or No) Rent Hike
Renters have more power than they realize in negotiating rents, at least in cooler rental markets.
“If you have a great payment history and have historically taken good care of the property, landlords are far more likely to negotiate a lesser rent hike, or none at all,” explained Nathan Miller, landlord and founder of Rentec Direct.
You can, of course, appeal to the owner’s sympathy, pleading hardship. But as in any negotiation, you’re more likely to succeed if you offer something in exchange. You could offer to pay the rent early each month, on pain of the rent hike kicking in if you fail to do so. If that landlord doesn’t take the bait, you could offer to prepay three to six months’ rent in exchange for no rent hike.
Turnovers cost landlords money and time in repainting, cleaning or replacing the carpet, marketing the property for rent, and possibly lost rent from vacancy. If you plan to stay for a while, offer to sign a longer-term lease contract in exchange for no or a lower rent hike.
Negotiate Other Perks
Sometimes landlords need or want the rent hike, but don’t mind giving you a different concession.
“Ask about other perks like parking, updated appliances, steam-cleaned carpets or pet accommodations,” added Miller.
Negotiate a Pay Hike
Inflation happens. Rents rise over time alongside other costs, and so, too, should your income. If your rent rises by 2% to 4%, and your paycheck rises by 10%, you come out far ahead.
But you don’t always get what you deserve — you get what you negotiate. Put together a persuasive case that you create far more value for your employer than you cost them, and schedule a time to sit down with them to negotiate a better pay package.
Of course, getting a raise at your current job isn’t the only way to earn more. Real estate investor Fred Loguidice of Sell My House Fast Ohio has worked side hustles which evolved into a full-time business. “You could switch jobs or careers, start a side hustle, or sell items you no longer need,” he advised.
Start a Savings Sprint for a Down Payment
If you think you can score a better bargain on rent elsewhere, you can consider moving. However, moving doesn’t have to mean signing a new lease.
Consider starting a savings sprint, where you quickly save as much cash as possible for a down payment. It’s uncomfortable to tighten spending to a bare minimum, but it can help you ditch the rental race altogether. Some mortgage programs, like Fannie Mae’s HomeReady and FHA loans, allow a down payment of just 3% to 5%.
You could even consider house hacking, where you rent out part of your home to offset your housing payment. As a renter, perhaps you could rent out a spare bedroom to help you save faster.
As a buyer, you can buy a multifamily property and rent out the other units. Lenders even let you use the future income from the other units to help you qualify for the loan.
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