How to Lowball Rental When Lease Expires?

So my lease is ending in 2 months time and I am currently paying above the average rental market. How do I lowball the agent in a polite way on the next lease renewal (if it happens)?

Melbourne

Comments

  •  

    Depends on the demand. I would think it is unlikely you will get it reduced.

    If the demand is low, then you might be okay and get a reduction, but you would need to plead your case as to why you want it lower - Lose of income? etc.

    • +61 votes

      Loss of incoming is a terrible argument. You would argue market conditions show similar properties are going for X, but I'm paying Y more than that. Or you could argue interest rates are at an all time low. Why would the landlord give a flip if you have lost your job?

      • +21 votes

        Also if you lost your job then you're a risk to just stop paying rent one day. A landlord would rather pay the reletting fee and get someone who has a stable job.

        It would only work if the rent market was really bad and there was a risk of the property being vacant for a long time, in which case the landlord would choose the bird in the hand.

        • -6 votes

          I agree and my reference to "lose of income" wasn't completely losing your job.

      •  

        Loss of incoming is a terrible argument.

        Okay, maybe not the greatest example

        Why would the landlord give a flip if you have lost your job?

        Never said about losing your job completely. If you lost your job completely with no income, you would need to find an alternative. I meant, maybe you are casual at a cafe in the CBD and only getting 50% of your shifts compared to pre COVID or something because of reduced traffic in the CBD.

        Plus, you would hope the landlord would have some hear and consideration who isn't a being a rich prick that is only looking at his bottom dollar to fund his retirement and yacht.

        You would argue market conditions show similar properties are going for X, but I'm paying Y more than that.

        Well yes, that is a good idea and it would also be related to demand.

        • +7 votes

          Consideration of tenants financial circumstances doesn't just come down to being a rich prick.
          If I had a good tenant for several years I would be inclined to give them a break on rent for a short period but at the end of the day it is impacting my income through no fault of my own and would be looking for new tenants if it was going to be significant rental loss.

          I don't see many tenants sticking their hands up to pay more when the landlord is has financial issues.

          •  

            @Mike88: Yep this is both party's living, so it is BUSINESS; there is not a lot of room for sentiment even if both parties are not particularly greedy.

            Saying "I can't pay" or "I deserve better" is going to cut no ice even if the landlord believes it. What you need, as in any negotiation, is what's called a BATNA - "Best Alternative To No Agreement" - that is, an outside option.

            So don't just tell - or even show - that the rent is above the market. Imply you are willing to move elsewhere unless the rent meets the market. Even better if you can point to specific rental vacancies you'd be interested in.

            That only works, of course, if the rent is genuinely above the market - ie at that rent a good tenant to replace you cannot easily be got. So check your local rental market thoroughly.

      • +3 votes

        Loss of income is actually a great argument if you frame it as lost income for the landlord i.e. if you leave they'll be forced to readverise at a lower market rate plus the cost of advertising fees and vacancy between tenants.

        As I've noted below though, it appears many landlords would prefer to lose income than capitulate to a tenant's rent reduction request. Pride isn't cheap, but it's a good little moneymaker for real estate agencies who profit from stubborn landlords who insist on readvertising their properties rather than accepting reasonable rent reductions.

        • +1 vote

          Not really, there are costs for both parties. A landlord knows this as well as you do as well.

          Most landlords also know that the pool for rental properties is currently shrinking. So, if you do move with the pain and expense they will be able to get another Tennant in quickly (obviously this depends on area, but most areas in Melbourne have a high demand).

          The only way to argue your case is how comparative their property is in the market. If the price is still not acceptable you could go to the tribunal or I think ACCC. Years ago I did this, however, it was due to a rental increase. We argued that due to all the construction happening in the area we were not able to use the property in the fullest and a rental increase is unwarranted at this time. They attended the property with two real estate agents - their finding was that even with everything including the rental increase the property is less than the market. They said if I proceeded then they have to provide this information to the landlord / real estate and they can increase the rent further.

      •  

        this guy know negotiates

    • +2 votes

      I have been renting from the same landlord for 3 years now. Haven’t miss a payment.

      • +3 votes

        Haven’t missed a payment is a bit of a slap in the face to any landlord. It’s expected. It’s a bit like the landlord saying I let you access the house every day of the lease.

    •  

      It doesn't depend on demand. Demand isn't a question. You don't write IF Demand THEN …

      It's supply that is the variable. Thus you write: IF !Supply THEN Demand.

      It all depends on where the supply isn't as to where you will get demand (a constant).

    • +2 votes

      I successfully negotiated a reduction in my rent by showing rental listings in my area with similar features at a lower cost, and by offering to sign a longer lease (18 months instead of 12). A big part that helped was the place next door was for rent for significantly less, had the same features on paper, but was in far worse condition.

      I'd suggest doing the same, finding places nearby that show your property is overvalued, and tell them you want to discuss it rather than asking for a straight lease reduction might get you in the door.

  • +13 votes

    Are you happy to risk not getting your lease renewed?

    • +10 votes

      I am currently paying $30 more a week for the same apartment in the building.

      • +22 votes

        So yes? If they don't agree to lower the price (either because they're greedy or the apartment has something special the others don't have), you can just move out to one of the others. Sounds like a win-win asking them to lower the rent!

      • +10 votes

        Just move to another apartment, there is no love lost between landlord and tenant. Relationship is transactional. Like you would with a bank, goto one that gives you a better rate, no one owns anyone anything…

        • +7 votes

          There are costs to both parties and risks - If he has been renting for 3 years and is happy with the relationship in terms of getting stuff fixed, timing for inspections etc makes more sense to try and negotiate with the current landlord/realestate.

        • +10 votes

          Geeze, you have a very bleak outlook on life. Just for the record, I am a landlord and I reduced the rent $40 per week due to lower market conditions, I had no clue things had dropped. Not every landlord is a scumbag.
          I hope tomorrow is a sunnier day for you.

          • +4 votes

            @robbyjones: You are the exception, not the rule.
            Most landlords don't have much in ways of communicating with the renter, they have the REA handle that for them. And REA are scummy batsards, so there is no relationship as you describe. SF3 is correct (in general) of his comment.

          •  

            @robbyjones: A good relationship with your landlord isn’t worth the paper it’s not written on when there’s an average 20% drop in the market.

      • +6 votes

        1.5k to move to another place to break even…

        • +1 vote

          2-3 bedroom houses are down around $100/wk in inner city Melbourne. Also pre-covid $300-350/wk would get you a rundown studio with a microwave and a sink, now it gets a 1 bedroom with separate lounge and full kitchen, why pay $200/week in a sharehouse when that is now an option?

          If you’re on a pre-covid agreement you’ll recoup the costs pretty quick.

          • +1 vote

            @Cheaplikethebird: Really? In Brisbane the prices have shot up stupidly and vacancy rates are at all time lows. We're seeing 40 people line up for a rental inspection.

            • +1 vote

              @Intoxicoligist: Really. Just search rentals in Melbourne CBD with a range of $300-350 and see for yourself, pages and pages of nice, new-looking 1-2 bedroom apartments.

      • +1 vote

        What's it going to cost you to move?

    • +1 vote

      you would kick a tennant out if they just asked for a rent reduction?

      •  

        I wouldn't, and I don't think anyone would do it just for that.

        But asking for a rent reduction means a lot of things, maybe you can't afford it, maybe you aren't happy with the value of the place.

        Either way, its not a good thing.

        I think it just depends if the rent being paid is truly above what it should be, which means the landlord will struggle to fill the place, or if its market value.

  • +14 votes

    Wait for the renewal notice to come in so you have your offer in writing, then call the agent and politely ask them to forward an email to the landlord on your behalf, then provide the agent with an email to the landlord asking for a reduction, show examples of similar properties to yours at a lower rent (dont fabricate nonsense or be silly about it). As a landlord I would hate to receive such an email BUT in the current climate (say Sydney or Melb apartments) its entirely likely you are paying above typical current rental. Landlords typically pay 2 weeks letting fee for a new tenant, plus advertising, plus wear potential vacancy opportunity cost. You staying on at perhaps $10-20-30 less per week me be a reasonable proposition in a tough rental market and worthy of a landlords consideration at least.

    •  

      Usually, my agent will send the renewal contract 2 months before the existing lease expires. Currently I have not receive anything yet and the lease is ending in less than 2 months. Should I call and ask or just play the waiting game? Currently, I am paying $30 more a week for the same apartment in the same building.

      •  

        If you don't get a renewal contract and your lease contract lapses, it will roll over to a month to month contract

        https://www.smallbusiness.nsw.gov.au/get-help/tenants-and-la...

        •  

          This is for small business though, not residential?
          Are they the same?
          If it doesnt get extended, ie become rolling contract, both parties only needs to give 1 month notice? If so, that's a pain for the tenant to secure another place and move…

          •  

            @OzFrugie: It applies for residential aswell. I used to rent with meriton and we got lazy and didn't renew our 1 year lease. Meriton also didn't send us any notice so we ended up being on a rolling month to month contract for 2 years. It worked well for us because we terminated the lease during COVID period and got a better place

            It can be a pain for either party depending who terminates first.

  • +8 votes

    well if you dont ask, you wont get, I would point out the $30 difference

    • +1 vote

      I donno why you where downvoted this is pretty standard advice ask and see what happens

    • +2 votes

      The agent will thank him for reminding him that others are paying not enough :)

  •  

    I hope you are not my tenant ^__^"

    • +4 votes

      I hope you are not my landlord. What on earth is wrong with asking the landlord for market rent on the new lease?

      • +1 vote

        How to Lowball Rental When Lease Expires?

        nuff said.

  • +2 votes

    For all we know you apartment could be bigger, in better condition, come with extra room, have a better view etc so the extra cost could be fair enough.

    However

    I'd ask for a reduction because you never know but i dare say it is unlikely your rent will drop if anything just hope they don't try to increase it.

    If you want to pay less rent 9/10 times you need to move location if the other apartments are $30 less then move to one of them.

  •  

    The only real way to get lower rent is to move out to a place with cheaper rent. Bargaining and consideration only works in extreme and very limited situations. Crazy as it sounds in the current market, you'd rather have a bank as your landlord instead and pay the higher mortgage.

    • +6 votes

      Once you pay the expenses of moving all your stuff you may as well stayed put. Moving furniture is expensive unless you already have vehicle and/or generous friends.

    • -1 vote

      "The only real way to get lower rent is TO THREATEN to move out to a place with cheaper rent. Bargaining and consideration only works WHERE YOU HAVE A CREDIBLE THREAT."

      Fixed.

  • +2 votes

    With the absence of overseas students the apartment market in Melb is a renter market . I would get some of the cheap rates on offer and negotiate harder than just $30 . Many owners are currently getting 0 .

  • +1 vote

    $1500 difference, just move to the other apartment.

    •  

      yep, and spend the $1500 saving moving there :-)

      •  

        New apartment's in the same building. Moving cost is a fridge trolley and a slab of beer for a couple of mates.

  •  

    If it's an apartment in the same building, you could ask the landlord but also be prepared to move out if you really want that $30 saving. As in, move out into the other apartment.

  • +3 votes

    It depends on the total rent, which I don't think you've disclosed.

    Say they say no, don't renew your lease and you rent "the other apartment"; most people need a few days or a week overlap to move stuff and clean up/pay cleaners in the old place… Or at the very least, you'll need to start paying rent asap to secure it (while you're still in your notice period on the old place).

    So if a week's rent is $300, then it'll take 10 weeks to break even on a one week overlap (ignoring any carpet/cleaning/transfer/moving fees). Maybe that's ok.

    If rent is $150 per week (unlikely but you never know), it'll take 5 weeks… If rent is $600 per week, it's going to take ~5 months to break even point.

    And these all double if you have to pay double rent for just 2 weeks.

    At some point, it will not be worth it, but no one can tell without the full story. Simple maths like "30*52= a ReAlLy BiG sAvInG" is beyond simplistic here.

    • +1 vote

      In the same vein what if you stay at your new place for 3 years? 30*156 is a huge saving.

  •  

    Approach the Real Estate before the lease expires. View some of the places the agents have that are lower rental than your current place, so you have a good understanding of the market. Make your offer.

  • +4 votes

    It's simple.

    You build an argument that shows you are paying above market and put your case. Your argument will be based around those rates and it will be cheaper for the LL to take a haircut on the rent than it will be to find a new tenant. You've suggested it's about $1,500 a year. Demonstrate that the LL will be looking at loss of rent, advertising costs, agent fees, etc. that will make the $1,500 look cheap.

    On the other hand, you have costs of moving as well. Are you sure you can secure a new apartment with "perfect cross-over" so you're not paying rent on two places for a week or two? You'll need to deal with the expense and hassle of moving, getting utilities disconnected/reconnected, etc. The LL/REA knows all of this as well.

    As with all business, it's usually better (cheaper) for parties who have an existing arrangement to find a way to keep that arrangement on foot than to have to strike up new arrangements elsewhere. By all means go for $30/week … understand you could get a flat no and then you either have to suck it up, or move … if they offer you $20/week, I'd run to the bank and get that cheque cashed!!

    •  

      they offer a reduction, wait 6 months for the increase

  • +1 vote

    You don't really have to formulate a reason, the agents would already know the market price and are likely prepared with the owner the band they are willing to accept.

  •  

    The fundamentals of this market haven't changed over the past 12 months. There is no reason for investors to change their strategy now by lowering their expected returns.

    •  

      There damned well is reason to change if they're stuck paying a mortgage on an empty apartment.

      If OP is paying above market rent and moves out, almost by definition that's what will happen to the landlord if he doesn't lower the rent for the next tenant. And if he has to lower the rent anyway to get a new tenant, then wasn't he a fool for refusing the reduction to the old tenant?

      Only snag in the ointment here is that the REA has a different set of incentives to the LL - he may WANT a new tenant as the LL pays the bill for the changeover. And accordingly give rektrading's advice.

  • +2 votes

    It depends on only 2 factors.
    1. Condition of the rental market. If the vacancy rates are increasing then they might agree to a reduction.
    2. The kind of tenant you've been. If you've been a good tenant the landlord might agree out of goodwill if you ask politely. If you've been a fussy tenant then they'd be happy to see you go. Just keep in mind the agent knows the cost and time involved for you to move might be a disadvantage for you and assume you wouldn't move out even if the rent isn't reduced.
    Cheers

    • +1 vote

      "Just keep in mind the agent knows the cost and time involved for you to move …"

      And doesn't know the (potentially large) cost of finding a new tenant at that rent? Or the value of a proven good tenant versus the risk of acquiring a deadbeat one?

      Sure, both sides lose if a deal is not reached, but if in fact the current rent is above market the LL's side loses far more than OP. Which the OP should know and use. Even if he doesn't privately think it he should be signalling that he does not consider his own loss would be large - "my moving costs and disruption would be more than made up for by the lower rent".

  • +12 votes

    I'm in Melbourne and just recently tried this with my owner. Developer knocked out half the back fence and started putting up two townhouses there so I hit up my RE for a rental reduction seeing as I now had a construction site less than 10m from the space where I live and work. The house we were renting was $600/wk (signed lease at beginning 2019) but was only worth around $550/wk in the current market (ignoring the construction site) with many comparable properties in the 450-550 range. We were on month-to-month so I offered to sign onto a 6 month lease at $450/wk to provide the owner assurance that their property would be tenanted through the worst of the construction while also compensating us for the reduction in living standard. Owner basically said to get stuffed and only came down to an offer of $575/wk, so still $25 above market rate. I figured it was in my best interest to move while the market was down and we're out of the busy season for rentals, I'm now paying 2/3 the rent for a house twice as big with newer fittings.

    It's worth a shot at a reduction but not many owners will drop to the actual current market rate unless absolutely forced to. I saw a post on r/AusFinance last year sometime where someone had receive a letter from their property manager basically telling them to hold the line and not reduce rent for their tenants.

    • +3 votes

      Good for you! I hope the house stayed vacant for a good long time

      • +4 votes

        Unfortunately my old housemate was lazy and stayed on so I missed out on that bit of schadenfreude.

    • +8 votes

      Agree with your final point - that not many owners will drop to the actual current market rate unless absolutely forced to. Most owners would rather be forced to take a bigger loss than voluntarily accept a smaller loss. It's bonkers, but that's the way the human brain seems to work. I don't know if there's a psychological theory that specifically explains this phenomenon but I'm sure it's related to loss aversion and the sunk cost fallacy.

      • +1 vote

        That and classism, many landlords believe that they are in their position by virtue of being smarter, savvier, and more responsible. Because of that they won't negotiate a deal with a tenant that does not lean in their favour.

      • +1 vote

        Your username is chilling

      •  

        Perhaps most but not all. I’d lower the rent if it was shown it was above market rate. Because if I didn’t and the tenant left, I’d likely need to lower it to get the next tenant anyway. For a landlord that is negative gearing $30 week for example is not worth worrying about. For the record the landlord is paying full commercial rates to get things fixed or safety checked, so they take hits throughout the year anyway of several hundred dollars a time.

        • +1 vote

          Ha! I was paying $600/wk for a 2 bedroom and they still sent their 80 year old grandfather round to do all the maintenance. Also worked in RE before and most owners IME would try and cheap out on maintenance if they had even budgeted for it, plenty times they didn't and would try and weasel out of doing it because they didn't have the money for it.

          I fronted $1k for emergency electrical work when we lost power on a Sunday, I made sure to use the REs electrician and everything but still the owner refused to reimburse me for it. RE confirmed I was in the right and he owed me the money but they couldn't force him to pay. I had to lodge a complaint with VCAT and the owner waited till the day before the hearing to roll over and pay me my money. Maybe you're a good owner but you're the exception not the rule.

          Also I'm not talking $30/week I'm talking drops of around $100/week for houses and more for units.

          • +1 vote

            @Cheaplikethebird: Yeah fair call, I only know my own approach. I remember leaving a good set of curtains at the last place I rented myself (before I bought) and the landlord was shocked and wanted to know what the catch was. I just didn’t need them so thought I’d help out the next renter of the place.

            Yeah $100 is a bit of a hit, but if that’s the market rate then that’s the market rate. Can’t really complain when the capital growth is currently very good.

    • -1 vote

      "I saw a post on r/AusFinance last year sometime where someone had receive a letter from their property manager basically telling them to hold the line and not reduce rent for their tenants."

      PMs have very different interests in this to LLs - a vacant apartment is at worst one less profit source and they may even make money from the advertising and setup costs. So of course the PM is going to be very relaxed about the risk of vacancies.

      But it can be a financial catastrophe for a small LL.

      This sort of purely self-interested "advice" is the reason REAs have the reputation they do.

  • +5 votes

    There is no such thing as polite when you low ball.

    Suggest you get print out of all the similar available properties nearby and give them an offer (probably take in the fact they will have 4 week vacancy time plus the cost of advertising). If they are unreasonable just move.

  • +3 votes

    My REA told me that my tenant would like to leave once the lease is finished. The rental market around the area has significantly dropped and the tenant would like to move to a cheaper place. I asked the REA to relist the property with discounted price to reflect the current market and the tenant saw the ad and contacted the REA asking whether they could stay & asked for a discount to cover the non refundable deposit that they have put into another property.
    I told them yes they can stay but no discount as they did not approach me to negotiate a lower rent and the onus is on them to cop the lost of deposit that the put into to another property. They agreed and stayed so it's a win win for both of us.

    So I would urge OP to negotiate the lower rent first and see where it leads to before deciding to pack up and move to another place.

    • +4 votes

      You sound reasonable, because you look at the market rate. I'm having the reverse problem - due to covid our rent is much too high (now $150/week to $200/week above market rate, we're in inner Sydney in an area that was very popular with overseas students/visitors & CBD workers & airbnbs, so it's dropped off a lot), and I've asked for a reduction, but the landlord has gone silent. This is same landlord who was happy to increase rent every year, citing rising market rates, but now the shoe is on the other foot, suddenly they don't seem so keen on market rates any more. We'll start inspecting alternatives rentals in a few days if it's not resolved.

      •  

        The discrepancy is crazy, I would be looking for another place really quickly too if I was you. Good luck with your house hunting.

    • +1 vote

      Haha bit of nerve to ask for the deposit back they paid to another landlord!

      Looks like a reasonable outcome for all parties involved

  • +1 vote

    In the midst of a rental shortage? Good luck, is all I gotta say.

    • +1 vote

      You don't know the glut of apartment in Melb currently available .
      Prices are crazy too to buy outright .
      Absolutely no demand vs supply.

    • +4 votes

      Not in Melbourne, the market is flooded with both units and houses and everything is down roughly 20% on pre-covid prices. It's all the Melburnians escaping causing the rental shortages elsewhere.

    •  

      Apartments in inner-city Sydney are also definitely down on their pre-covid prices. I get that some places have much more rental demand than before, but given no overall increase in population, the corollary is that some places have much less.

      •  

        Hi NickJ,

        I haven't found this that is the case now. Initially till about February of this year they were much lower (Sydney inner city, student areas) but corrected quickly in March 2021 as well as fewer vacancies.

        I was following the market also with lots of examples of lower rents in my building and area. Then it quickly changed. I am also on a higher floor though with views and appreciate that there may be a premium. Also, many people are not prepared to lease from Overseas Investment Houses and the disparity in price can be big.

  • +1 vote

    Lucky you're not in Perth or it would go up $60!

  • +10 votes

    A Template I used successfully used for rent reduction, Received it from Reddit but only useful if the market around you has actually gone down:
    I'm writing to request an ongoing reduction to the rent for XX. Due to the recent situation the rental market has changed considerably. In light of our need to reduce costs, and the new realities of the rental market, we wish to request a reduction in the rental rate to $ XXX per week.
    Based on a recent assessment of rental opportunities in the neighbourhood we could see much larger and newer properties available for much lesser than our current rent. We believe a new rate of $XXX p/week is reasonable for both of us as it would provide the owner with continuity of rental income and also help us avoid moving costs. The suggested rent is still higher than our review of the rentals of similar and better properties in the neighbourhood:

    Property 1: XXX. This is a much newer property with better amenities less than 50 metres away from our unit, more modern, with newer appliances supplied. Rent: $XX P/W Day on market: On market since December 2020. Owners are open to a lower offer.

    Property 2: XXX. This property with modern bathrooms and air conditioning recently Rented for $XXX P/W after being vacant since Dec 2020.

    Property 3: XXX. A property with the same level of amenities and much larger and usable open space available since January 2021 for rent at $XXX. This unit has been on the market for over 5 weeks now.

    The recently renovated property near us was on the market for over 45 days before it was rented for much lower than what we are currently paying. These are just a few examples that demonstrate the market has shifted. We have also discussed with friends and family to confirm the current market - the vast majority have negotiated reductions this year.

    We have been living happily on the original rent for a long time, however a rental rate of $XXX P/W is significantly less than the costs involved should we vacate this property. If this property stays empty for 6 weeks it would cost our landlords nearly $XXXX + leasing fee even at the proposed rent at least. It is likely the property would be empty for more than 6 weeks, so this is a best-case scenario.

    If we cannot secure a reasonable reduction in rent to bring the property in line with the current rental market, we may need to look at other options at today's market rate.

    Please do reach out to the owner and request for this rent reduction from XXX and communicate back to us the next steps.

  •  

    If you're in Melbourne then usually it's pretty simple, send through ~3 similar listings for cheaper, and ask them to match.

  • +17 votes

    Melbourne renter here. My previous lease ($430pw) expired in April 2021. I offered to re-sign for 12 months at $370pw, citing equivalent rents for a range of similar properties (including an identical neighbouring townhouse that leased for $360pw six weeks prior). The landlord countered with $410pw. I immediately gave them my 28 days notice and within a week I'd signed the lease for a slightly nicer property at $350pw plus a free month of rent. Two months later, my original landlord has re-advertised their property for $390. Considering the time the property has sat vacant plus the cost of readvertising, the landlord is already worse off than they'd be if they'd accepted my proposal.

    Moral of the story for tenants: your best option may be to cut ties with your current landlord and move into a cheaper/nicer place elsewhere. Landlords are too accustomed to perennial rent increases and/or too prideful to consider serious rent reductions, even when it's in their best economic interests to make them.

    Note: when negotiating with the landlord via the real estate agent, I got the feeling the agent was feeding them bullshit about the market value of their property. Makes sense - discouraging the landlord from making a reasonable rent reduction made the property vacant, which means more advertising and commission $$$s for the agency.

    Moral of the story for landlords: beware of smiling assassins, and consider whether your pride is worth $1000s in lost income.

    • +1 vote

      exactly, I've worked closely within estate agents in the past, it's a bit of conflict of interest to let the rent drop, both for management fees as well as overall return of an area which they are selling the property. If you can negotiate with the landlord directly somehow it's always a much easier conversation. Landlords love good tenants that don't cause headaches and will to provide incentive to keep them. A relative of mine even offered slightly lower than market rate on negotiations for good tenants when inquired.

    •  

      " when negotiating with the landlord via the real estate agent, I got the feeling the agent was feeding them bullshit about the market value of their property."

      What - an REA bullshitting to an owner about the value of a property? Surely that never happens!

      As I said, when a lease is being renegotiated the PM's interests are quite different to those of the LL. The landlords on this thread should stay aware of that.

  • +1 vote

    Vacancy rates in the CBD peaked at 14.6 per cent in October but have fallen marginally in recent months, from 11.6 per cent in February to 11.4 per cent in March.

    Melb Inner City apartments really is a disaster zone for owners .

    https://www.domain.com.au/news/wont-be-able-to-give-them-awa...

  •  

    Present the owner (or REA) with a list of similar properties in the area and which demonstrate the average rental rate in the area.

    If you are indeed paying above average market rate, go ahead and ask for a reduction. If they agree, great! If not, you have other options…

  • +1 vote

    OP, similar to some of the posts, I suggest provide some example of comparables in the same apartment coupled with hopefully a very good payment history. If you can talk to the landlord directly it would be ideal, RE agents have a conflict of interest to keep the rentals high for both management fees and property yields.

  •  

    Please go ahead and ask for a reduced rent.
    Landlords these days seldom have any other option, other than to reduce the rent.
    I got mine reduced by $50 a week.

  •  

    If you still want to move apartment make sure consider the cost of end of lease clean + moving cost and see if it's worth the hassle…

    •  

      Lol apartments that were going for $450/week are now at $300/week. I reckon you’d recoup your costs pretty quick. 1 month, maybe two if you’re lazy and it’s an expensive move.

  •  

    If you have made payments on time, every time, or made minimal requests to maintain property

    If you go above and beyond taking care of the property.

    If it’s completely hassle free for landlord and the market is slightly lower, how much of a saving? $10/20 a week? Would you move to save $20 a week?

    •  

      The current Melbourne apartment rental prices are down by at least $50-$80 a week.

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    you need to provide evidence of lower prices in the neighbourhood. If you are in an apartment this is easily done, however house might be a little more difficult

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    Point out the good rent record as well as the $30 and ask before the end of lease, in case the landlord raises it - impossible to then negotiate down.
    A Landlords worst case is an empty apartment or unreliable people, they may not do $30 but you'll likely get something.
    It will cost you approx $1k to move so it's only worth it if it's going to be for a long time.

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    The landlord will call your bluff on your request for a rent reduction, the $1500 saving by moving to another apartment will be offset by the cost for you to relocate there. The landlord will know that you will not do it as it is not worth the hassle. Also, as an investment property, the landlord will devalue the property if they wish to sell it by quoting the lower rental return.

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      You underestimate how far the market has dropped in Melbourne

  • +2 votes

    Friend of mine signed 12 month lease in Feb 2020 in N. Melb for $590/week and around Jan this year there were numerous places in his building advertised for $380-$450. He emailed the agent with links to those places and said he believes $430/week would be a fair price for the next lease, they were happy to go with that. So it's very possible to save a hell of a lot of money if you're talking about an apartment in the city. I don't rent in the city so I don't know if maybe by now rents are back up, but if you're asking for a fair rate it's not 'lowballing' and you don't need to tiptoe around it - offer a fair rate and if they say no just move.

    On the other hand, if you believe your current rate is fair (or very close to fair) and you're not willing to move, then asking for a reduction is 'lowballing' and it's not polite - so either be rude and do it or be polite and don't.

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      Jeeze, that's a massive saving. Lucky for your friend.