With rental prices at record-highs, here’s some advice to keep in mind before you sign a new lease.
While finding a good deal on an apartment rental has never really been an easy feat in the summertime, this year is proving to be especially difficult.
Thanks to a mix of various economic factors — record-high inflation outpacing slow wage growth, increasing interest rates pricing would-be homebuyers out of the market and apartment landlords making up for expired Covid deals — renting a new place is suddenly a lot less affordable. Just this June, rent prices had their biggest monthly gain since 1986 — that’s over three decades.
As rent prices continue to climb across the country, Select spoke with Lily Liu, CEO of Piñata®, a rewards and credit-building platform for renters, about how to navigate these price hikes. Below, she shares four best practices for renters hoping to avoid breaking the bank.
Tip 1: Avoid moving between April and September
According to MovingLabor.com, 80% of all moves in the U.S. happen during “peak” moving season, which is defined as occurring from April to September.
Because of the high demand for rentals during this time, especially since the kids are out of school, buildings have less inventory and tend to charge more for available units. It’s a classic case of high demand and low supply boosting prices.
It’s not just a new lease that will cost you more — the prices for moving services are higher during the peak season as well.
So, when is the best time of year to rent? According to Liu, who references RentHop.com, winter — between December and March — is “typically the slowest time for property managers to fill vacancies,” meaning there’s a good chance you can save money if you sign your lease then given the lower demand.
“Between the holidays and unfavorable weather, fewer people are apartment hunting, which means you’ll have less competition for that dream corner unit with a washer and dryer,” Liu says.
Tip 2: Negotiate any add-on fees
When you are ready to apartment hunt come the colder months, be wary of the prices you see. Before you get too excited, make sure you know exactly what the monthly cost of renting will be all in, as some landlords will tack on extra fees per month on top of the base rent price.
These additional fees might include costs for pets, pest control, trash, internet and cable, parking and other amenity fees. Ask landlords beforehand about all the fees the lease would and wouldn’t cover, and perhaps try to negotiate any add-on fees as part of your rental agreement.
Tip 3: Offer to sign a longer lease
Although standard lease terms are for 12 months, landlords will typically offer a lower monthly rent price for longer lease terms of 15, 18 or 24 months.
Even if your landlord doesn’t offer a discounted rate for longer lease terms upfront, let them know you’re willing to stay longer as leverage for a lower rate because they will benefit from less turnover of your unit.
You’ll benefit, too, and not only from a possibly lower monthly rent. Locking in a rate today for, say, two years is a smart move — if you plan to stay in the same city — since landlords will likely increase the price once your lease ends and it’s time to re-sign.
Tip 4: Benefit from paying your rent
While this last tip might not save you money as a renter immediately, it can have a lasting impact on your finances in the long term. Nowadays, there are financial products that reward renters for paying their monthly rent, so you might as well take advantage of your responsible financial behavior.
Piñata®, for example, gives users points whenever they pay their rent on time, and those points can be redeemed for rewards such as free food, exercise classes, gift cards, travel discounts and other services through apps like TaskRabbit and DoorDash.
You may even want to consider paying rent with a credit card, such as the Bilt Rewards Mastercard. The standalone Bilt Rewards program allows qualifying U.S. renters to start earning rewards each time they pay rent through the Bilt app. To earn even more points, the co-branded Bilt Rewards Mastercard lets cardholders earn points for using it to pay for their rent and other transactions.
Your points can be redeemed for travel through one of Bilt’s hotel or airline transfer partners, fitness classes with SoulCycle and several other studios, limited-edition artwork and home decor, next month’s rent or even a down payment on a home.