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Negotiation at lease renewal - Landlord Forum thread 317542

Negotiation at lease renewal by SG (California) on April 16, 2014 @01:45

                              
So, the lease is coming to an end with my tenant. In the hopes of raising rent little bit, I gave options to tenant either to sign another year lease or move out. I told him I'd be happy to keep him along and sign one more year lease with him.

You won't believe what happened next, he comes back and gives me two options - A) extend the lease for 9 months a reduced rent, $200 less than what he has been paying last 12 months, or B) he moves out as his lease is over.

I am feeling little offended with his counter, specially with low ball offer. Tenant is acting on the fact that he pays rent on time and it would take me anywhere between 2 to 6 weeks to fill in another tenant. Of course he is posing this as a negotiation. The way I see it, he is playing hardball.

Am I alone in feeling this way? what would fellow landlords or tenants reading this post feel?
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Re: Negotiation at lease renewal by Anonymous on April 16, 2014 @01:55 [ Reply ]
He needs to move out. Start with another tenant.
Re: Negotiation at lease renewal by SG on April 16, 2014 @02:07 [ Reply ]
Of course, that's already in works.
Re: Negotiation at lease renewal by Anonymous on April 16, 2014 @03:16 [ Reply ]
This is just business. Is he making you money with things as they are? If so tell him your offer stands as it was. Getting him out because he's damaging the place or not paying rent makes good business sense. Getting him out just because he made a boneheaded and ureaseonable lease offer doesn't make good business sense. The tenant probably watched some gameshow on tv and decided this would be a good idea.
Re: Negotiation at lease renewal by Micah on April 16, 2014 @09:14 [ Reply ]
Counter with raised rent on a m2m
Re: Negotiation at lease renewal by Garry (Iowa) on April 16, 2014 @09:24 [ Reply ]
You are in control here. But you need to make a good business decision, based on the rental market in your area. If you feel you can find a good renter in just a couple of weeks, at maybe a little bit higher rent, then stand your ground. Offer the T a 5% increase in rent, and meet him part way by offering to sign a 9 mo. lease with him. If he is a good renter, try to keep him. If he's not, let him go. The T has a point here, but only if he knows the rental market better than you do. You are both in negotiations here, and you may end up just extending the lease for 9-12 mo., with no change in rent at all.
Re: Negotiation at lease renewal by Bill on April 16, 2014 @10:07 [ Reply ]
"I gave options to tenant either to sign another year lease or move out."

The tenant is playing hardball?

When you throw a "hardball" expect to see a hardball coming back.
Re: Negotiation at lease renewal by Nicole (PA) on April 16, 2014 @11:15 [ Reply ]
all business dealings are negotiations - not sure why you are so upset with this.

it's all money - remove your "feelings". if the place is empty for 2 months because he moves out, what is your monetary cost? More or less than the $1800 he's proposing for a reduction?

counter with $100 reduction for a 9 month lease or the $200 with a 12 month lease ... whatever you want.

or have him go and get someone else in as quickly as possible .. crossing your fingers that they pay timely like this guy has ... I don't care how well you screen someone, you don'tknow who is comingin the door.
Re: Negotiation at lease renewal by Anonymous on April 16, 2014 @11:48 [ Reply ]
Unfortunately, a 9 month lease would put you vacant in the middle of winter, about January 2015. This is not cool. A $200 discount for a less than 12 month lease is not good, IMO.

I just offered my tenants a 12 month lease with no increase, MTH at a little higher price, or move out. They have about a week left to decide and tell me in writing. They were trying to buy a house but decided against it; at least the one they were considering. A realtor told me nice houses in good neighborhoods are selling in two to three days or less!

I would counter offer this person and offer a smaller break on a 12 month lease. After all, it will cost you money to have it vacant and turn it around.
Re: Negotiation at lease renewal by SG (California) on April 16, 2014 @12:25 [ Reply ]
Thank you all for who offered their viewpoint. I definitely see the case for both sides. The rents in the area are comparable or slightly higher than what he is paying, that is why his offer of lower rent gave me a jolt.

I guess my expectations of raising rent and the complete opposite outcome surprised me more than it should have. I will keep this episode in my mind while dealing with future tenants.

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