Search Articles

Find tips, tools and how-to guides on every aspect of property

Tips tenants can use to negotiate a lower rent in Malaysia

test

Have you ever had this thought where you question, “Can I settle for a lower rent?”. This article answers all you need to know about negotiating a lower rent with your landlord, how much can you negotiate and when is the best time to talk about it.

negotiate rent
@freedomtumz | 123RF

For most people, renting is the more attractive option for housing. It has always been the preferred choice for people who move around frequently or do not want to be tied down to one location. It is also much easier should one go through circumstances change, either logistically or financially. 

Renting is also a good option for people who cannot afford to buy a property outright, as it is more affordable than purchasing a property. Thus, fewer commitments. The upfront rent payment is lower than the down payment one must pay on a mortgage and one would not have to worry about property taxes or other costs involved when buying a house.

There is no denying that rent can be expensive, especially if you want to live in an easily accessible area that is complete with public transport, shopping malls, and other nearby amenities. As such areas are highly desirable, rent prices can be inflated. If you are looking to save money, it is necessary to negotiate with your landlord before signing the tenancy agreement. This article provides tips and tricks on negotiating for lower rent, when is the best time and how you can ask your landlord not to increase rent.

Can you negotiate for a lower rent?

Many assume that a rental price is unchangeable and there is no room for negotiation. But in reality, you can negotiate for a lower rent. For example, if you are moving into a unit that has been vacant for an extended period, the landlord could be willing to lower the rent to attract potential tenants.

Landlords do expect tenants to negotiate when it comes to monthly rent. In many cases, the landlord already has a higher price in mind, but they are willing to negotiate down to a more reasonable rate to close the deal. 

It is always important to note that only a few landlords will be open to negotiation. However, it is always worth asking; what you can achieve out of it could be beneficial.

TIPS: Be respectful and polite during the negotiation, as it helps to have a good rapport with your landlord, which can increase your chance of getting the price you requested. 

How much can you negotiate your rent?

how much can negotiate rent
@primagefactory | 123RF

Rental negotiation is more common than you think. If you want to score a lower rent, here are a few tips to help you negotiate like a pro!

1. Find out the rental market price

When it comes to negotiating rent with your landlord, knowledge is power. Before you begin the discussion, it is essential to do research and know the average rent price for a similar property within the area of choice. This will give you a good starting point to negotiate. 

For example, you are looking to rent a duplex unit at Pinnacle, Petaling Jaya but the rental price is RM2,600/month and way out of your budget. What you can do is check out different property listings within the same building on iProperty.com.my and compare the monthly rent prices. Now that you have knowledge of the market price, you can negotiate with the landlord for something between RM1,500 to RM2,500 for a unit at Pinnacle.

You can use this information to show your landlord that you are familiar with the asking rental rate and that you are hoping for a fair price. This way, you will be in a much stronger position to negotiate a lower rate. However, keep in mind that your landlord may or may not be willing to budge on the price.

Check out properties for rent

2. Decide on desired rent price

One of the most important aspects of renting is agreeing on a monthly rental that works for both parties. Negotiating rent is a lot like interviewing for a job. You need to be informed of what the market rate for the property is and be respectful in justifying the rent you desire.

Here are a few things that can help justify the rent:

  • Compare your unit to other units within the building

Suppose there are units similar to yours in terms of built-up size and amenities provided but are being rented for a lower price, then you have a good reason for asking for a lower rent from your landlord.

  • Request for a lower-floor unit

Higher-floor units typically come with a premium price tag as it has panoramic views, better air quality, and is more peaceful from sound pollution. If you are willing to forego those, you can opt for a lower-level unit which is more affordable.

CHECK OUT: Pros and cons: Is the higher or lower floor better?

As a tenant, you are at the mercy of your landlord who wants to charge you as much as possible every month. However, if you come into the negotiation with a firm number, you are more likely to get the desired rental amount. Thus, take some time to figure out the monthly rent you can afford to pay each month.

You should also be aware of any added value in the average rental unit. If your landlord is reluctant to lower your rent, asking for extra amenities can be a way to reach an agreement.

Some of the amenities that you can try to ask for:

  • Additional parking spot
  • Include WIFI services
  • Additional furnishing (ie; water dispenser, dryer, etc)

Alternatively, if you live in a building with assigned parking and do not own a car, let your landlord know that you are willing to give up your spot in exchange for a lower rent. This is highly effective if parking spots are limited and in high demand.

3. Be prepared to compromise

Anyone who has had experience negotiating rent knows it can be tricky. After all, the landlord is in the business of making money. On the one hand, you want to get the best possible deal for your situation. Still, on the other, you wish to avoid placing a fairly low price on the landlord and ending up getting possible issues in the long run. So how do you negotiate for a lower rent while still protecting your interests?

The key is to be prepared to compromise. If you are asking for a significantly lower rent, be ready to offer something in return. Landlords can be willing to negotiate for these few offers:

  • Sign a longer lease

If the current lease is 12 months, see if the landlord is willing to lower the rent in return for signing a longer lease. The beauty of this strategy is it will be a win-win situation for both parties, the potential renter and the landlord. You get to save money on your monthly rent, whereas the landlord can avoid the hassle of finding new tenants every 12 months.

For families with young children, assuring your landlord that you will be a long-term tenant is a great way to score lower rent as well as to ensure the rent is maintained throughout the tenancy. Inform your landlord beforehand that you plan on staying until your children finish school. It will give them the confidence to offer you a lower rent, knowing they will not have to worry about finding new tenants for at least a few years. In addition, it shows that you are serious about making the rental property your home for the near to mid-future. 

You will also have peace of mind knowing that you do not have to move when your children are just getting settled into their schools.

REMINDER: Make sure you are prepared to commit to a longer lease before making this offer.

  • Pay rent for several months in advance

By offering to pay 3-4 months upfront on top of the security deposit, you show that you are a reliable and responsible tenant. Your potential landlord will be more willing to settle on a lower rent if they know they would not have to worry about chasing late payments. Paying upfront may seem painful at first, but its long-term advantage is that you would enjoy cash savings throughout the tenancy.

  • Extend termination notice

Extending the termination notice gives the landlord ample time to find a new tenant. It means they do not have to worry about an unpredicted move-out by the tenant. This can be especially helpful if you live in an area with high turnover rates.

4. Offer referrals

Another approach you can take is offering referrals for a reduced rate. Let your landlord know that you will be happy to spread the word on their property in exchange for lowering your monthly rent. After all, word of mouth is one of the best marketing tools out there.

If you are a student, it will be more effective as students are always in need of housing. By spreading the word about the building’s occupancy, you can help the landlord to attract new tenants while also getting a break on your rent. This would work if your landlord has 1 or more rental units within the building. Moreso if the property owner has been experiencing low occupancy rates.

When is the best time to negotiate for a lower rent?

Similar to everything else, timing is one of the most crucial aspects when negotiating rent. Here is the best time suggested for you to negotiate a lower rent.

1. When your lease is expiring

For those looking to renew their contract, you should start your rent negotiation conversation early. 3 months before your lease expires is the suggested time to ask if there will be an increase in your monthly rent. This will give you plenty of time to negotiate and eliminate the risk of losing your current rental property.

Many tenants are in the position of most leverage when it comes to renewing their tenancy agreement. Landlords are more likely to go out of their way to keep you as a tenant. They want to avoid having no occupancy in their property, making it the best time for you to negotiate your current rent.

TIPS: Refer to your tenancy agreement and look for a clause that requires you to give your landlord a notice a few months in advance if you plan to renew your lease at the same rate.

2. Before you move in

New tenants should know they can negotiate their rent before moving into the rental property. If you start early, you will likely get that lower rent.

Therefore, the best time to negotiate is between the period the landlord agrees to take you as their new tenant and before you sign the tenancy agreement. This is because once the landlord feels like you are a good fit, they would want to take advantage of this opportunity of gaining profit.

How to negotiate with your landlord not to increase the rent?

negotiate house rent
@takasuu | 123RF

When the pandemic hit,  many landlords chose to lower their rent to reduce their tenants’ financial burden. Since most industries and businesses are back to normal, landlords have begun to raise rental rates again. Here is what you can do to maintain the rental rates post-covid.

1. Point out your records

One of the best things you can do is prove your record as a good tenant, and this tip works for both new and renewing tenants. 

If you provide a proper explanation of why maintaining your rent would benefit you and your landlord, there is a good chance you will be successful in negotiating. For example, suppose you have always paid your rent on time and been an overall model tenant, you show you are a reliable and conscientious tenant. Knowing this, your landlord will likely work with you to maintain or lower your rent.

2. Set up a deal with your landlord

If you are finding it hard to keep up with your rent, you can try and set up a deal with your landlord. For example, you could agree to take care of any minor damages that occur in the property in exchange for a lower rent payment each month. This can be a win-win situation for both parties. You get to stay at a more affordable price, and the landlord does not have to worry about taking out extra money for repairs all the time. 

Of course, you will need to be careful to avoid damaging the property too much, or you will cost yourself more in repairs than you save in rent!

3. Negotiate clauses in the tenancy agreement

This is to be kept in mind at the beginning of the tenancy. Many are unaware that they can negotiate the terms of their tenancy agreement, which the landlord usually prepares. In anticipation that your rent might be increased when the property market recovers, you can include certain clauses in the agreement that protects you in the longer term.

For example, request for a clause that gives you the option to extend the tenancy at the same rental rate (a 2+1 or 2+2 contract).

READ: 10 terms and conditions in a tenancy agreement you should look out for

If your landlord is not budging on the rent, it never hurts to ask – the worst they can say is no. And should they decline, remember that you can always try again later or look for another apartment altogether. Be sure to do thorough research, know your numbers, and prepare to walk away if necessary.

ARTICLES JUST FOR YOU
Questions to ask your landlord before renting
📜 10 terms and conditions in a tenancy agreement you should look out for

Disclaimer: The information is provided for general information only. iProperty.com Malaysia Sdn Bhd makes no representations or warranties in relation to the information, including but not limited to any representation or warranty as to the fitness for any particular purpose of the information to the fullest extent permitted by law. While every effort has been made to ensure that the information provided in this article is accurate, reliable, and complete as of the time of writing, the information provided in this article should not be relied upon to make any financial, investment, real estate or legal decisions. Additionally, the information should not substitute advice from a trained professional who can take into account your personal facts and circumstances, and we accept no liability if you use the information to form decisions.

More Articles