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I suppose this is mainly for landlords, although if there's anyone with experience on this issue, I'd be grateful for a reply.
Due to some financial pressures and slower business, my family's rent is becoming increasingly burdensome for the 3BR apartment we have. We have another six months on the lease, and we won't have a problem getting through that, but we're most likely going to start looking for something different. I've been checking prices lately, and it seems that in general, rental rates for 2BR and 3BR apartments are quite a bit lower than what they were 1-2 years ago. My complex has 3BR apts with a price range of just over $300. The range was much, much narrower when I renewed my lease last year (the range was $30-40 then). Can I assume that the complex is gradually lowering the rent on my floor plan, keeping the upper range price high to avoid upsetting current tenants with active leases at those prices (i.e. like me)? 2BR seems to have gone down a bit as well, although not as dramatically. The higher demand 1BR hasn't gone down really at all.
If the landlord refuses to lower my rent to the new lower end of the 3BR range, I will have no option but to move - either to a 2BR in the complex or a different 3BR, preferably in the same complex if something's available.
Before I talk to the landlord, though --- I'm expecting the renewal letter in September/October, by the way --- do you think it might be worth proposing to my landlord to sign a new lease right now at the lower rate? In most cases the answer would obviously be "no", but I live in the Chapel Hill/Carrboro area, and I'm sure they would love to have my lease expire at the end of the end of July rather than at the end of January as it currently does (more chances to sell it to students, since August start dates for leases are in much higher demand).
What does everyone think? Am I reading into this too much? Could there really be a $320 difference in apartments with the same floor plan - at the same complex?
I've never worked at a leasing office for an apartment complex, but I would have to say yes... My evidence was the Craigslist postings on the same floorplan for $200-$300 less than what we were paying--the considered them "specials" that ran for a "limited time". It was towards the end of our lease and we were planning to move anyway, but I guess that's just part of the business. You'd probably be able to haggle with them a bit and get the rent dropped a bit though... always worth a shot. Btw, the complex offered to not increase the rent if we renewed.. As if it was a reward for being a good tenant... Ha! In the end, it's still a business so I can't fault them for trying..
I've never worked at a leasing office for an apartment complex, but I would have to say yes... My evidence was the Craigslist postings on the same floorplan for $200-$300 less than what we were paying--the considered them "specials" that ran for a "limited time". It was towards the end of our lease and we were planning to move anyway, but I guess that's just part of the business. You'd probably be able to haggle with them a bit and get the rent dropped a bit though... always worth a shot. Btw, the complex offered to not increase the rent if we renewed.. As if it was a reward for being a good tenant... Ha! In the end, it's still a business so I can't fault them for trying..
There's no way they can play the "specials" game at all. They had "specials" signs up last fall for several months after the financial crisis started. I should have checked what the rental rates were then, but I didn't (it was about a month or two after I had renewed our lease - maybe I didn't want to get disappointed!). Anyway, there are no "specials" signs now, which leads me to believe these are the new rates. I'm extremely happy with the complex, but to save $300-500 per month, I will definitely move to another apartment, either a different 3BR or a 2BR at my complex or another neighboring complex that's just as good. I can only assume that the rental market is not going to "recover" by December/January, especially in a college town where the ideal lease ends in July and starts in August.
There's no way they can play the "specials" game at all. They had "specials" signs up last fall for several months after the financial crisis started. I should have checked what the rental rates were then, but I didn't (it was about a month or two after I had renewed our lease - maybe I didn't want to get disappointed!). Anyway, there are no "specials" signs now, which leads me to believe these are the new rates. I'm extremely happy with the complex, but to save $300-500 per month, I will definitely move to another apartment, either a different 3BR or a 2BR at my complex or another neighboring complex that's just as good. I can only assume that the rental market is not going to "recover" by December/January, especially in a college town where the ideal lease ends in July and starts in August.
I own some individual properties that I rent, so I don't have experience with large apartment complexes. However, I can tell you that rental rates can and will differ for identical units. It's best to think of rentals as commodities, so the rent amount will be dependent upon what the market will bear at that moment in time.
If a 2BR unit is sitting vacant at $1k/month, then the landlord or property manager will drop the price accordingly in order to get that unit occupied. The fact that someone signed a 12-month lease at $1k/month four months ago doesn't really factor into the decision to lower the rent right now because the landlord is taking a financial hit by having a vacancy.
I would encourage you to speak with your landlord. Just be honest and explain the points you stated in your 2nd paragraph ("Due to some financial pressures and slower business..."). Obviously you'll want to emphasize that your rent is a high priority and that you've had an excellent payment history in the past and will continue that in the future.
Just because there are no "specials" signs posted, don't assume that the property manager won't be willing to negotiate with you. If you've been a good tenant, then it's in their best interest to work something out with you. Good luck.
I own some individual properties that I rent, so I don't have experience with large apartment complexes. However, I can tell you that rental rates can and will differ for identical units. It's best to think of rentals as commodities, so the rent amount will be dependent upon what the market will bear at that moment in time.
If a 2BR unit is sitting vacant at $1k/month, then the landlord or property manager will drop the price accordingly in order to get that unit occupied. The fact that someone signed a 12-month lease at $1k/month four months ago doesn't really factor into the decision to lower the rent right now because the landlord is taking a financial hit by having a vacancy.
I would encourage you to speak with your landlord. Just be honest and explain the points you stated in your 2nd paragraph ("Due to some financial pressures and slower business..."). Obviously you'll want to emphasize that your rent is a high priority and that you've had an excellent payment history in the past and will continue that in the future.
Just because there are no "specials" signs posted, don't assume that the property manager won't be willing to negotiate with you. If you've been a good tenant, then it's in their best interest to work something out with you. Good luck.
Good advice. I love the complex and the people who run it, but I want to go into a discussion with the right approach. When I first signed the lease, there were two prices for the 3BR units. The higher is for a higher vaulted ceiling in some units that has proven popular enough in the past. It was only a $40 difference. Can I assume given the range in prices that there are empty 3BR apartments now and that no new leases are being signed at the high end of the range - that the high-end is on paper only to avoid upsetting current tenants with active leases?
Would I be laughed at for proposing to cancel the current lease and adjust the rent down by $300 a month in exchange for a July end date? Would having an apartment free up in late July or early August be attractive for them enough to take a hit by lowering the rent I'm paying? My intuition is yes, but not without some intensive wiggling on their part. But maybe I'm reading too much into all of this?
In any event, I'll make it clear that unless business dramatically picks up in the next few months, I will be unable to continue paying anywhere near the current rent when my lease ends in January. I will focus on my own finances and my love of the complex (and good paying and good neighbor history).
Hopefully I get all your questions answered. If I miss anything, let me know!
I managed apartment communities for over 7 years here and still work in the industry. The thing with rates is no one will ever pay the same rate. They change so frequently, sometimes even several times in one day. Rates are determined by what competitors are offering, what your vacancy rates look like and the desirablity of the units at hand. So no two people are likely to pay the same rate, even if they have the same floor plan. One could be on a floor level that's not desireable or has an a/c unit outside of the window. There's a lot of thought that goes into pricing units.
I think with your limited experience in the industry (and I don't mean that offensively), you're overanalyzing the situation.
The prices you're seeing that low are likely on a particular unit or 2 that they're having a tough time leasing for whatever reason. They may be a tough sale because of their location, condition, etc. So desperate times call for desperate measures on units like these and rates get slashed. The majority of the units are likely closer to your rate, maybe even higher, who knows.
You're in a totally different ball game as a renewal. Your negotiating power is limited because your rate has already been set based on those factors above. You're paying more, which tells me you're in a highly desired unit for whatever reason. So the odds of them reducing your rent at all are slim to none. And yes, they would probably laugh at you asking for a $300 reduction. I think the best you can hope for is to not be increased.
As far as the rental market, it may appear to you that it's in a bad state right now, but in all actuality, this market is booming. More and more people are turning to rentals with the housing crunch. Since new construction of apartment units has halted with the credit crunch, demand is actually quite high. The demand in Chapel Hill/Carrboro is actually the highest in the entire Triangle, boasting the highest occupancy levels and market rents.
Finally, as far as when you lease expires, communities actually plan their lease expirations out far in advance so they have a set number of leases expiring each month. This creates a simple flow that promotes even leasing activity and helps keep the maintenance turn process efficient. Changing the term of the contract you're already in is not going to be an option. They are already planning on your lease expiring in January.
Alot of people try to play the hand that they will move when their lease is up to try to get a better deal. Nine times out of ten, that doesn't work. As a manager, I would just take your notice to vacate and wish you the best of luck. Managers don't like to wheel and deal. Aside from being annoying, it opens up a huge grey area in terms of Fair Housing. The rates are what they are and there's not much deviating from them.
You can always try, you never know, you may be that 1 out of 10. But just be prepared that it's likely not going to go in your favor.
Let me know if I missed anything or you have any other questions!
Hopefully I get all your questions answered. If I miss anything, let me know!
I managed apartment communities for over 7 years here and still work in the industry. The thing with rates is no one will ever pay the same rate. They change so frequently, sometimes even several times in one day. Rates are determined by what competitors are offering, what your vacancy rates look like and the desirablity of the units at hand. So no two people are likely to pay the same rate, even if they have the same floor plan. One could be on a floor level that's not desireable or has an a/c unit outside of the window. There's a lot of thought that goes into pricing units.
I think with your limited experience in the industry (and I don't mean that offensively), you're overanalyzing the situation.
The prices you're seeing that low are likely on a particular unit or 2 that they're having a tough time leasing for whatever reason. They may be a tough sale because of their location, condition, etc. So desperate times call for desperate measures on units like these and rates get slashed. The majority of the units are likely closer to your rate, maybe even higher, who knows.
You're in a totally different ball game as a renewal. Your negotiating power is limited because your rate has already been set based on those factors above. You're paying more, which tells me you're in a highly desired unit for whatever reason. So the odds of them reducing your rent at all are slim to none. And yes, they would probably laugh at you asking for a $300 reduction. I think the best you can hope for is to not be increased.
As far as the rental market, it may appear to you that it's in a bad state right now, but in all actuality, this market is booming. More and more people are turning to rentals with the housing crunch. Since new construction of apartment units has halted with the credit crunch, demand is actually quite high. The demand in Chapel Hill/Carrboro is actually the highest in the entire Triangle, boasting the highest occupancy levels and market rents.
Finally, as far as when you lease expires, communities actually plan their lease expirations out far in advance so they have a set number of leases expiring each month. This creates a simple flow that promotes even leasing activity and helps keep the maintenance turn process efficient. Changing the term of the contract you're already in is not going to be an option. They are already planning on your lease expiring in January.
Alot of people try to play the hand that they will move when their lease is up to try to get a better deal. Nine times out of ten, that doesn't work. As a manager, I would just take your notice to vacate and wish you the best of luck. Managers don't like to wheel and deal. Aside from being annoying, it opens up a huge grey area in terms of Fair Housing. The rates are what they are and there's not much deviating from them.
You can always try, you never know, you may be that 1 out of 10. But just be prepared that it's likely not going to go in your favor.
Let me know if I missed anything or you have any other questions!
Thank you very much for the detailed response.
After thinking about what you wrote a bit, and thinking about the analogy to the commodities markets (which I do know a bit more about!), I suppose there's not much hope for a reduction in rent on a 3BR at my complex. Incidentally, my unit is one of the more desirable ones (top floor, lots of light).
Since my daughter is starting school this fall, my need for a separate home office is probably less than what it was before, so we could probably downsize to a 2BR. When would be a good time to approach the landlord about a possible 2BR in January? Now? When I would need to give notice? Would most managers even make you give formal notice for moving to another unit? Would a new application be required?
More than likely, your community requires a 60 day notice from their residents. So if you're talking about moving in January, then the best time to talk to them is about 75 days prior to your lease expiration. By that time, they'll have notices on most of the apartments that they can make ready for you in time for your move and they can establish a price on them. Once you select a unit, you'll submit a notice to vacate with intent to transfer. You shouldn't have to pay a new application fee, although some communities do have a transfer fee.
If you're interested in moving into a 2 bedroom prior to your lease expiring, you can always pose the situation to them. I've transferred residents before during their lease, especially if I had a particular unit that I wanted moved and they were in a highly desired one. It never hurts to ask!
If you have any other questions, feel free to ask!
If you're interested in moving into a 2 bedroom prior to your lease expiring, you can always pose the situation to them. I've transferred residents before during their lease, especially if I had a particular unit that I wanted moved and they were in a highly desired one. It never hurts to ask!
Ah, yes, that question came to mind just as I posted the last response. I suppose I could ask now and have them keep me informed, although I'd be surprised if they could move my 3BR right now at the current price, let alone higher one - unless the 3BR units going for $300 less are just terrible in comparison. That just seems like too good of a deal for this complex right now otherwise.
I just received notice from the landlord that the rent will stay the same for my apartment with lease renewal at the end of January 2010. The 3BRs at our complex have been going nowhere but down in price for pretty much the entire year and I believe since the financial crisis struck last fall. Right now, 3BRs are going for $400+ less per month than what we're paying and slated to pay when the new lease starts.
So, I haven't spoken to the landlord yet, but we have decided to move unless they agree to a significant rent reduction. It is quite obvious that these are not special rates and that the market most certainly will not improve by late January, especially in Chapel Hill/Carrboro where the main rental season is late summer with student turnover. Something tells me they really don't want yet another 3BR vacant at that time.
Anyone have any tips on how to successfully get a rent lowered by 15-25% (which would still put the price well above what the same units are going for now)? Given that vacancy in our complex has increased from 3/4% to about 7/8% over the last year (according to the maintenance guy I talked to), business sense would seem to dictate that they keep us at any price at or above current the current market price.
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