Negotiations are Part of Human Behavior and can be Really Stressful!
Before a Lease is Signed
This is the ONLY time I will CONSIDER tenant negotiations. I always have my lease ready to go. I read the lease WITH my tenants. As we are reading the lease or even during showings people will ask questions.
Some examples of possible tenant negotiation points (with my answers to give perspective):
*Will you take a 6 month lease?– I charge a $300 premium unless the 6 month lease works best for me. I usually require 12+ month lease unless I want to move the lease cycle into a better time of year.
*I only make 2 times the income requirement. Is that okay? -Honestly I think 3x rent is low so I DO NOT lower this point.
*Will you lower the rent $200? – Unless I over priced the house (which is rare) or I have had no bites, I do not negotiate with rent. If I am going to lower the rent then I change the ad and advertise to EVERYONE this lower rent.
*I am not moving out here for 3 more weeks. Will you hold the house? – After being burned we no longer hold the house at all. The house is available when the house is available. If they wish to have the house they will take possession and start paying for the house as of the availability date. I have not had any trouble with finding people to follow this policy. If they are interested they will take the house.
These are just a few of the MANY questions I have been asked.
This is the time that these and MANY other questions are safely addressed! Personally after this SMALL window (once lease and deposit are accepted) then I no longer negotiate. This is your time as the landlord to come back with a “counter” offer.
I do not stop showing the house or accepting other completed applications during this process. I have had other tenants “take” the house while another is being wishy-washy. I do not hold or put another person on hold during the process. The first person to be approved and completes all the documents gets the house. This also keeps it fair because my process doesn’t change.
In my experience if someone is TRULY interested they can get the paperwork done in hours. I have not had this policy burn me. If anything it has made my life SO much easier and less stressful.
After a Lease is Signed
Once the lease is signed I do NOT re-negotiate. Whatever we agreed upon is enforced by both sides. I am not allow to make the pot any sweeter nor are they. That is why I have a 14 paged lease that details everything from the Break Lease Clause to Who Pays Pest Control. That does not mean I don’t still receive requests.
I simply say No! This is also why I require a deposit with lease signing and rent with keys. When people are upset it is human nature to start to try to find “leverage”. As a landlord it is VERY stressful and annoying when you feel people are holding you “hostage”. Therefore, do yourself a favor and say NO, but ALSO make sure you have your ducks in a row.
No one cares about your home, rentals, personal financial situation, etc. more than YOU DO! While we all try to do the right thing; remember to take care of yourself as your primary objective. While every one has a “sob” story you are in your place to say no! You have a right to protect your own family interests. Even if that family is small or even if that family is (gasp!) making money on a rental. To date the only time negotiations have ever hurt me was when I said yes when I should have said no.
How do you handle negotiations with either your landlord or tenants? What are your best practices?