As a landlord, you have to wear many hats, and one of them is being a level-headed negotiator. Let’s face it; life is an endless series of negotiations ranging from tiny to enormous. And your success as a landlord may largely depend on your skills in rental contract negotiations. You must possess a thorough knowledge of people and the Alamo Heights rental market. Of course, if you’d rather hand that responsibility over to experienced professionals, PMI First SA Properties is a full-service property management company with more than 20 years of experience.
1. Ready to Walk Away
Don’t take a firm position in any negotiation without being willing to walk away. If you’re bluffing, and the other side calls your bluff, you look like a fool. Being able to walk away doesn’t mean there isn’t room for both parties to succeed. On the contrary, a good negotiator always wants both sides to win. However, without the ability to say no, you’re negotiating from a position of weakness.
2. Return on Investment
Before you decide to raise a tenant’s rent or deny their request for a slight reduction, ask yourself whether this particular rental contract negotiation is worth it. Good tenants are hard to find. Consider the turnover costs involved in replacing your tenants, such as cleaning fees, credit, and background checks, not to mention the time involved in showing the property to potential renters. Ask yourself if you’re going to profit in the long run from this negotiation.
3. Seasons Matter
Even if you have the best little rental property in Alamo Heights, the time of year affects your negotiating leverage during rental contract negotiations. While south-central Texas doesn’t suffer from the extreme winters experienced in other parts of the country, summer months still experience higher rent turnover. More potential renters mean a stronger negotiating position for property owners. The winter months tilt the leverage more towards the renter.
4. Offer Improvements
If your tenant feels your property isn’t worth the price you’re asking, consider making some improvements to the property. Ask why they think the property is overpriced, and try to accommodate those concerns. There may be a quick and inexpensive upgrade that you can make to your rental to get the price you’re seeking. Be flexible and listen carefully.
5. Time to Vacancy
If your tenant wants to renegotiate a lower rent close to the time of renewal, your options become more limited. You run the risk of having an empty property until you can find a new tenant. Of course, your tenant might be bluffing, and he can’t be sure of the quality of his other option. Nobody likes moving, so he’s in a bind as well. If he wants a lower price, explain that you usually raise rents at renewal periods.
6. It’s Not Personal
Though your business life is just an extension of who you are as a human being, you still need to separate the dollars and cents of negotiations from your personal feelings. Even if we don’t agree with someone about the value or price of something, there should never be any ill will involved. A good negotiator wants both sides to win. Don’t let a difference of opinion turn you against your fellow man. In the worst-case scenario, you can always agree to disagree.
As an Alamo Heights landlord, excellent rental contract negotiation skills are just one of the many skills you need to be successful in your chosen field. Of course, if you prefer, you can delegate the unpleasant responsibilities to a full-service property management company. PMI manages more than 20,000 properties. Call them today to find out what they can do for you.
