If you’re just coming out of college or moving out on your own for the first time, you may be looking to rent an apartment rather than buy a home. And that’s A-OK. Unless you have been investing in well-performing mutual funds since your fifth birthday, renting may, in fact, be a better financial option for up-and-coming twentysomethings.
Contrary to popular belief, renting is not the worst thing you can do for your finances. In fact, if you rush things and buy before you’re ready, you can end up in a worse financial position than if you had just decided to rent. Renting might not offer a return on your investment, but you’ve got to live somewhere right? And because renting is so much more affordable than purchasing a home, it can buy you a couple years to save up a nice little nest egg. All those savings will help to put you in a better position to buy when you’re actually ready.
But renting a place to live is still an important financial decision, and you don’t want to get in over your head when you go out apartment hunting. Use these tips to negotiate lower rent on your next pad so you can have a little dough left over to start padding that nest egg.
DON’T JUDGE AN APARTMENT BY IT’S POOL
Drive down any main street in America and you’ll pass ritzy, gated rental communities and run-down, slummy apartment complexes. Logically, you would assume that the slummy apartments would have much lower rent.
That may not always be the case.
For two years, I thought I was living in the cheapest apartment complex in the area. When I decided it was time to move a year ago, I toured some of the more prestigious complexes and was surprised at how affordable they really were. They actually turned out to be cheaper than the apartment I was living in at the time. Moral of the story? Don’t judge a rental by it’s exterior—do some due diligence on any apartment before you cross it off your list.
DON’T HIDE YOUR PAST
Many high quality apartment complexes will base their rental rates or deposit and application fees on your past rental (and, often, credit) history. Obviously if you have good rental history, there’s a better chance that you will pay your rent on time and won’t turn out to be the newest party animal of the complex. So be sure to provide all your rental history –– even from when you were in college –– so that your new landlords can see that you have been a loyal resident to your past landlords. It could save you some cash in the end.
And if you know that your future landlord may find any red flags in your past rental or credit history, be upfront. Explain the situation on your rental application and point to other factors that make you a well-qualified renter.
SEEK OUT SPECIALS
Apartment complexes are notorious for “look and lease” specials where you sign a lease on the same day that you tour the apartment. However, these specials change often, sometimes even daily. Ask your leasing agent about upcoming specials to see if there is one that suits you better in the future. I did this at my current apartment complex and decided to wait a day for a new special that ended up saving me almost $100 per month on my monthly rent.
Rental properties often want you to lease so badly that they’ll throw in all kinds of free amenities to get you to sign a lease. An attached garage is a huge selling point for me, so as I was touring one of my first apartments, I asked them if they had any garages to offer. Turns out they did and were offering them, that month, for an extra $1 per month if you signed a lease. I wouldn’t have even known about this add-on had I not asked about it. Know what your top priorities are and don’t be afraid to ask what your new landlord can offer you. If a certain complex doesn’t offer you what you want, you can always move on to another property.
CHECK FOR EMPLOYER DISCOUNTS
You can never go wrong asking about employer discounts. If you just landed a job out of college and are looking for an apartment, try searching nearby your new job – the closest apartment complexes will probably offer you a discount if they have an agreement with your new employer. It never hurts to ask!
KNOW WHAT YOU WANT
As you embark on your new journey of independence, you’ll learn a lot of things about living on your own. Don’t be afraid to voice your opinion and tell people what you want and need. Their answers could surprise you.
I’ve learned that the power of “just asking” is very strong. If you want a free month’s rent or a covered parking spot, tell your leasing agent exactly that. They’ll probably want your residency more than anything so they’ll jump through hoops to please you.
Finally, be prepared to say “No”. Those “look and lease” specials are can be hard to turn down. But if you don’t feel right about the deal, just walk away. In the end, you’ll probably be happy that you did.
What are some tips that you’ve used to save money on your rent?