How to Negotiate a Lease Renewal

Last year, I moved into a giant one-bedroom with level floors, six windows, three closets, and no mice. It’s wonderful, and I love living there. This came after four years of your standard apartment nightmares: roommate tension, pest infestations, and unwelcome sexual advances from landlords. It was time to stop settling, and really like where I lived. I found an apartment, fell in love, and after some negotiation, agreed to pay $1,325 a month for it. That’s much more than what I’d normally pay, but for once, I needed real closet space. I deserved level floors.

Then the thing that happens to most of us occurred a year later: I received a renewal lease with a drastic rent increase I wasn’t prepared to pay. First year leases are priced low to fill the unit quickly. Then landlords assume you’ll be too broke and/or lazy to move, so they increase the price, make their money back, and don’t have to paint the walls again. So far, you’re losing this game. Luckily, it really is possible to satisfy both parties, as long as you have some room to negotiate.

Negotiating seems like it’s going to be all power play and body language tricks—saying things like, “You’re breakin’ my balls, here!”

In reality, it’s a discussion about how to make both you and your landlord happy—they don’t want you to move out, they just want more money and not to have to find a new tenant. I have no advice about how long to draw out the negotiation, whether to low-ball, or when you should accept a final offer. You’re the best judge of what you can afford, what’s fair, and how much negotiating you are willing to do. Here are some tips.

1. Start the conversation. A good opener is, “I received the renewal, and I’d love to stay in the apartment but the suggested increase is too high for me. I’d like to discuss the terms and find something we’re both happy with.” Whether you call/visit/email depends on how accessible your landlord is and how good or bad you are at talking to people.

2. Know what your apartment is worth. Request a rent history for your apartment (in New York City, this is a standard request of the housing authority; I’m not sure about other cities). Ask your neighbors what they pay, check out similar apartments in the neighborhood. Then mention that either your apartment isn’t worth what they’re asking for, or that you could easily find a similar but cheaper place. If you really want to get into it, research your local rent laws and guidelines, and check that the increase is legal. Your landlord might stress that the increase is below what’s legal—that doesn’t mean it’s appropriate, and certainly doesn’t mean you have to feel grateful.

3. Learn something, even one small thing, about the market that works in your favor. Find out if property values went up or down in your neighborhood, and find out how that compares to the national or city average. Another great one is vacancy rates—an increasing vacancy rate in the area is a major vulnerability for your landlord.

4. Show off what a great tenant you are! You don’t even have to be that great, you just have to point out the bad things you haven’t done. Note that you haven’t burned the place down, bounced a check, disturbed the neighbors, snuck a pet in, or broken a window. If you have done these things, you’ll get no judgment from me, but you should skip this point in the negotiation.

5. Try to extend your lease. Many large realty companies don’t offer multi-year leases because vacancy and replacing tenants isn’t a big threat for them. But for smaller companies or families, guaranteeing that you’ll stick with them might be worth more than an increased rent.

6. Offer money up-front. Like Tip No. 5, this usually won’t help you out if your landlord is a large company and/or super rich. But for small companies and families, several hundred in the pocket is worth more than a grand spread out over a year. Offer to pay your first 3 months up-front in exchange for a lower rent increase. On a related note, you can also offer to push your payment date to before the 1st of the month.

7. Provide services for the home or building. This could mean that you offer to make some repairs on your own, or that you agree to be on-call for helping out other tenants. This requires being handy, as well as having a flexible schedule. BRAINSTORM: Become an informal doorman and commit to being around during the work week to sign for everybody’s packages. I have not heard of people doing this, but I would pay money for that.

8. Come up with some requests. Would you be willing to pay the increased rent if they’d just replace those awful, drafty windows? Or the crumbling grout in your bathroom? What if they agreed to bring an exterminator twice a month instead of once? How about access to the backyard? If you can’t get your landlord to budge on the money, they might be willing to do something else. This is a good time to think of new perks along with maintenance items you weren’t sure you had the right to ask for.

Not all of these tips are going to apply to you. Pick and choose what makes sense, and work it into a nice little email, letter, or script. Here’s an example for you:

August 6, 2012

Dear Landlord,

I am writing in regards to the renewal of my lease at XX Xth Street, apartment X.

Since moving into the building last year, I have been a consistent tenant with a great payment record. I have not incurred any late fees or bounced any checks, with the exception of an incident in July when I was subject to identity theft. This issue has been resolved, and I believe it is noted in your records. Additionally, I have not damaged the unit in any way or required extra maintenance. I’ve really enjoyed living there and take very good care of the space.

The rent in the lease renewal paperwork is a 13.2% increase from what I am paying now, which is quite large and I believe unfair. My monthly payment would jump from $1,325 to $1,500 (and would then increase again the following year). This increase would cost me over $2,000 in the first year alone. At this rate, the cost of moving would be significantly lower than staying put. Also, for $1,500 per month, I could rent an apartment of similar size in the same neighborhood with newly refurbished appliances and surfaces, or in an elevator building, or with in-house laundry facilities.

I suggest structuring the renewal lease in one of the following ways:

1. A two year lease, with monthly rent of $1,350, with first 3 months of rent paid up-front on October 1.

2. A two year lease with monthly rent of $1,375, wherein the landlord agrees to replace window locks and reimburse tenant for cleaning supplies for the building lobby (the building lobby smells of cat urine consistently)
Additionally, I would be happy to alter the terms of my lease to reflect a payment deadline on or before the first of each month. Currently, late charges are not applied until the 10th.

Since my original lease was accepted, my credit standing and financial stability have improved significantly, indicating how responsible I have been and will continue to be. By keeping me in the building at the rates I suggest, you are ensuring a full, on-time rent payment each month and a much greater chance of securing another two-year lease in 2014. You will also save yourself the hassle and cost of finding a tenant in October, after the busy season of apartment hunting has already come to a close.

I look forward to continuing the conversation and hearing from you shortly.


Ellen Smith

That’s the letter I sent a couple weeks ago to my landlord. I had to call and pester a few times to get a response, but when I heard back, they were willing to take $1,400 per month and they agreed to take care of the cat urine smell! For me, that was worth staying in the same place. Moving is the worst, and I’ll happily pay $75 per month not to do it.


Ellen Smith still can’t get over the fact that her floors are level. Photo: Mirage Floors


17 Comments / Post A Comment

riggssm (#297)

It all seems so logical and sane. How I wish I could have a dialogue like this in Boston.

probs (#296)

How timely, my lease is coming up in a few months. Can’t decide if I want to move or not, but this could come in handy.

Rezpect (#621)

In what city is this apartment located?

@Rezpect I’m curious about this too. She pays $1325/$1400 a month and she doesn’t have new appliances or laundry in the building? I live in Chicago so I don’t think I’m being a rube about this, I find that insane.

selenana (#673)

@Rezpect She mentions NYC in #2.

ImASadGiraffe (#982)

@Lynn Marie@twitter I’m also in Chicago and I pay $780 for a large studio with new appliances and laundry downstairs. No a/c though, other than a window unit.

Caddy@twitter (#1,711)

@Rezpect @Lynn Marie@twitter @ImASadGiraffe I live in the San Francisco Bay area and for SF city proper this is not unreasonable for the kind of apartment she describes. It sounds about right for NYC as well! I had no idea Chicago would be so much cheaper.

pizza (#599)

I’ve had really good luck with this with my apartment in NYC. Although I feel like I can’t ever move out of my place because the neighborhood got too expensive. Currently, the condo building across the street rents a 1br for $700 more a month than my entire 3br.

shannowhamo (#845)

Has anyone had luck doing something like this with a big apartment company? We’re not talking NYC, we’re talking very suburban Texas but our rent renewal is alot higher than last year’s increase.

jajanise (#1,781)

I do renewals for a property management company in the Chicago area and I have to say that her points may work with an owner of just one or 2 buildings, like she stated in the article. However, medium or larger companies will not be willing to do a lot of these items. For example, all the points about the rent I have already researched before I sent out the renewal price. Therefore I will have the answers to the market rents in the area, what the neighbors are paying, the rental history of the apartment, etc before I send you my renewal price. Offering to pay your rent upfront is not an incentive because in most states if you take more than 3 to 5 months rent ahead of time, the company is supposed to pay you interest on that rent. Most people don’t know this though and as a landlord, I don’t need that headache. Just pay the rent on time each month. It doesn’t help the company by paying ahead of time, unless you are a individual landlord of just a building or 2. Even then, if they are not careful, it can come back to bite them. As for doing your own repairs, most companies do not want that either. That takes the control of how the building is being maintained out of their hands and a decent company would not want that. However, they would be happy to address the concerns and do the work for you as part of the renewal. I would suggest that you don’t wait though if you have a concern. Most companies are willing to address your issues throughout the lease so that when renewal time comes, we don’t have to negotiate these type of things. Lastly, by stating that you are a good resident and haven’t damaged the apartment in any way does not help. It is expected that you would be a good resident and not damage the apartment in any way. Yes, it is appreciated but I don’t think you should be rewarded for doing what your contract states you should do. Just like you want the landlord to do what that have stated they would do when you rented. It is just what should be expected. Yes, I know that it does not always happen that way, but the goal it to rent to those who will respect the property and a landlord who will be attentive to maintaining the building. Both of you have a choice. Much more can be shared about this, but these are just some of my observations…

susanhill (#5,067)

You could ask for help the Turner Pest specialists, they could find a solution for the cat urine smell. Nobody likes to move but unfortunately not a lot of people know that negotiating the lease renewal is the first thing they should do if they are not pleased by their apartment.

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