When a property owner asks us to help them rent out their property, we always aim to get the best rental price possible. When it comes to tenants, we know that it is normal to want to discuss if a lower rental price would be an option. Although many owners can be adverse to this option, rent negotiation can actually benefit landlords in the long run. Below, we discuss the benefits of rent negotiation.
Tenant Retention
Being open to rental price negotiation can increase tenant retention. When tenants are given the opportunity to negotiate their rent, they feel valued and heard. They also feel that they are getting the best value possible for the unit. This can help build a positive relationship between the landlord or property management company, and the tenant. This can result in longer lease agreements, fewer vacancies, and lower turnover rates, which are all positive outcomes for landlords.
Vacancies
Rent negotiation can reduce vacancy time, especially if a unit is struggling to find viable tenants at a certain price point, or if the unit is listed at a price point higher than what is average for similar rental in the area.
When a rental property is vacant, it can cost landlords money in lost income. By negotiating rent with current tenants, landlords can keep their properties occupied for longer periods, which reduces the chances of experiencing vacancies. Additionally, keeping tenants for longer periods can help landlords save money in the long run due to eliminated vacancy and turnover expenses.
Your Rental Property is a Business
Your rental property is a business, and rent negotiation can increase profits in certain circumstances. When tenants stay in a rental property for longer periods, they are more likely to take care of the property well, report maintenance issues as soon as they arise, and treat it as their own. This reduces maintenance overall costs and ensures that the property stays in good condition. Additionally, by keeping tenants happy, landlords can avoid the costs associated with eviction, which can be expensive and time-consuming.
It’s not always in everyone’s best interest
Discussing rental payment with a tenant is not always in the best interest of the property owner, and each circumstance should be looked at as a unique conversation. Many factors can impact assessing this. We recommend connecting with a local property management company if you have questions about reducing vacancy time, how to best assess rental price, or when it should be considered.
For example, we would typically not recommend negotiating rent with a potential tenant if the property is seeing a high volume of qualified applicants who are willing to honor the listed price.
Rent negotiation can be a win-win for both landlords and tenants. By engaging in a respectful and constructive dialogue with their tenants, property owners or property managers can improve tenant retention, reduce vacancy time, and increase their profits. This can create a more stable and profitable rental business in the long run.
