Canadians are facing financial challenges right now. Between interest rate hikes and inflation, the cost of living is increasing. One of the largest expenses for Canadians is housing. Paying rent is becoming more challenging every day. Fortunately, it is possible to negotiate a lower rent. Continue reading to learn how to successfully negotiate your next rental agreement.
How negotiable is a rental agreement?
Rent is negotiable. This doesn’t violate any Canadian rental laws or Landlord and Tenant Board regulations, including those in the Residential Tenancy Act. Even if you have to pay rent month to month, it doesn’t mean you don’t have a say in the price. In fact, many people have created a better financial situation for themselves by negotiating lower rent.
How and what to research
Before any negotiation, it’s best if you gather all the facts first. Fortunately, the internet and mobile devices have made doing research really easy and convenient. In some instances, you might need to contact an expert, like a realtor or lawyer, for specific details you can’t find online. Here are some topics you should research before negotiating rent:
Market price
What is the current market price of renting in your area? Be sure to find comparable rental units to yours that have a competitive price. If you can’t find information online, call other open rental units in the area and ask for rent estimates to gather comparables. Try to find units that have lower rent than your unit to build your case. In addition, determine if utilities are included in prices.
Offer something in return
Think about what you can offer your landlord in return for reduced rent. This could be signing an extended lease so the landlord can assure the unit is occupied for a longer period of time. You could also offer referral tenants for another unit they’re trying to fill. You can cut down your landlord’s costs by taking on some maintenance activities, like snow removal and lawn care, so they can pass the savings on to you. Or you can prepay rent a few months in advance if you have some savings. The idea is to make a deal so that both you and your landlord benefit.
Practice
Do a mock rental agreement negotiation with a friend or family member. In addition, you can barter with people selling items on an online marketplace to improve your skills. Lastly, consider writing a rough script of how your negotiation will go with your landlord. The more confident you are in your skills the more comfortable you’ll be and the better the chances are of success.
When is the best time to negotiate?
The best time to negotiate is a few months before your lease is set to renew. Give yourself some extra time because, if the negotiation doesn’t go as planned, you should be prepared to walk away and find another rental unit. Otherwise, your landlord may use the fact that you need housing to maintain the current rental price. It’s also courteous to your landlord to give them some time to think about your negotiation.
Is there a difference when negotiating as a new or existing tenant?
Negotiating rent is possible when you’re a new or existing tenant. The existing relationship you have with the landlord can be very beneficial when it comes to setting up a new rental agreement. Using your good payment history and behaviour as negotiation tools can go a long way.
When you’re a new tenant, a landlord may not be as motivated to reduce rent. Although, you can still successfully negotiate using property market data and good references. Or, you can offer something in return for a lower rent.
Tips for negotiating success
Anyone can successfully negotiate, but it does require insight and practice. When you’re ready to approach your landlord to negotiate rent, here are some tips:
Request
Before anything, ask your landlord, property manager or property management company if rent is open to negotiation. If they say no, respect their response and walk away. If they say yes, move forward with your negotiation plans.
Intention
Be sure to state your intention, wanting to pay less rent. It’s ideal if you have a goal number in mind. You may not get the exact number you want, but it’s good to have a number to open with.
Confidence
It’s important to approach the situation with confidence. Although, this shouldn’t be mistaken for arrogance or aggressiveness – be sure to maintain compassion. Your landlord is human too and has bills of their own to pay.
Be prepared with facts
Facts don’t lie. Bring your research and other data with you. When appropriate, present it to the landlord. This includes both your rent research and good qualities as a tenant.
Offer alternatives
When asking for lower rent, offer something to the landlord in return. For instance, an extended lease, doing some maintenance, or altering other adjusted terms.
Be open to compromise
Be open to compromise when negotiating. You may not get the price you want now, but perhaps in another year you can reduce the price again if you’re reasonable now. It’s about building a good relationship with your landlord!
Follow up in writing
Whatever you agree on during your negotiation, send it to your landlord in writing. Ideally, the agreement would be communicated through email. This will help to ensure your negotiation is legally binding. When the time comes to review the terms of the agreement, you’ll have a record of what was discussed.
Final Thoughts
Successfully negotiating lower rent in Canada is possible. Remember, you have renter rights and the power to negotiate with rental agencies. However, it does require effort and preparation. While this might seem daunting, learning to negotiate is a valuable skill. It can help you reduce rent now and negotiate other aspects of your finances, such as a raise at work. If you successfully negotiate rent, be sure to produce your rent cheque on time as a thank you!
Are you struggling to pay high rent costs because of credit card debt? Consolidated Credit can help. Reach out for a consultation today!
