How to Negotiate with a Landlord who wants to increase the price of my apartment lease
My landlord is asking for a 50% increase in my rent. However, my contract caps the increase to 10%. He's not budging. After the first negotiation, he went down to 40%. What are the next steps I should take?
1. Offer to buy the apartment
You can offer, "I'll give you $100k over what you paid for it" plus some extra for the furniture. Then you would own your apartment and pay yourself rent. You have to be able to afford this (or get a mortgage). But if you are paying $2,000 a month in rent now, then in 10 years you will have paid $120,000 in rent. If you buy the place for $200,000 more than he paid for it then after 10 years (when the lease expires) you will have made back your initial investment of $100,000 and all the rent payments after that would be pure profit.
2. Negotiate with other tenants
Perhaps there are other tenants on his floor who are also getting large increases in their rents and they might want to join forces with you to buy out the landlord.
3. Ask him what he needs from me
Maybe I can't afford to buy my apartment but I can afford an increase if he lowers his costs elsewhere. What does he need? Is he having trouble making ends meet? Does he need cash flow? Can I help him with expenses elsewhere so he doesn't need as much money from me? Perhaps I can help him lower his electricity bill by suggesting energy saving measures or even paying part of his electric bill (if it's not too high). Or maybe I can do work-for-rent on something around the building that would save him money elsewhere.
4. Negotiate within your legal rights
If tenents are allowed a 10% increase every year, is there any way I am not following those rules? Did I move into this place within the last year so perhaps that clause doesn't apply to me? Maybe my current rent is 20% below market rate so is there a way to adjust for inflation instead of just flat out saying no to any increase at all. Does our contract say anything about maintenance issues we've had since moving in or ways we should be compensated for them (like lower increases later on if we make small improvements now).
5. Look for alternative housing options
If none of these strategies work then look at alternative housing options within your budget range. If this landlord wants an additional $1,500 per month from me then maybe I should look at places that cost less than that per month. Perhaps there are apartments cheaper than mine on different floors of my building or even other buildings nearby where prices are cheaper because supply is greater than demand and vice versa. Perhaps there's an area nearby where prices haven't gone up yet but will soon because of new subway lines being built nearby or similar reasons why supply/demand might change soon enough so landlords will have to lower their prices again once they realize how fast their properties are being rented out compared to their competitors'.