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Renting an apartment can be expensive, especially in cities with high demand. However, there are a few tips that tenants can use to reduce their apartment rent.
With a little effort and creativity, tenants can find ways to lower their apartment rent and save money in the long run. You can even buy your own home with the amount you saved all those years.
We have 13 tips for you that can help you reduce rent and eventually save up for your dream home.
Find a Roommate
Adding a roommate to your living situation is probably the easiest way to save money for an apartment, both before and after signing a lease. It’s been concluded that having a roommate can save you anywhere from $200 to $1,100 per month. On the lower end, you could still save up to $2,400 per year if you choose to live with someone.
Having a roommate doesn't just mean saving on rent. You can also save on utilities, services, groceries, or other miscellaneous expenses. If you're fortunate, they'll also split chores with you.
Finding roommates is also relatively uncomplicated. You can essentially live with just about anyone- friends, relatives, partners, or even random people. Many platforms allow you to search or advertise for roommates, whether that's on social media or rental service websites. In the scenario where you have a shorter time frame to save up for your new home, finding a roommate is a great way to save up for an apartment in 3 months because it reduces the initial rent costs.
Save on Utilities
Cutting down on utility usage is a simple way to save a few bucks every month. Turn off any lights or the tap when it's not in use. Unplugging any appliances or electronics that passively use energy can also help save on your electricity bill.
Some more obvious ones are watching less TV or doing only one load of laundry per week. Switching regular light bulbs for LED bulbs will also make a huge difference in your electricity consumption and will also help you save money.
Consider Living in a Cheaper Location
Metropolitan areas have never seen higher rent prices. Rent growth rates are skyrocketing, with some cities seeing a yearly increase of as much as 24.80% in rent prices. It may be common sense, but living in the suburbs or the outskirts of an expensive city can save you a substantial amount of money.
Forbes reported that the national rent average was $1,848 in urban areas, while in suburban areas it was $1,269. That's over a 30% decrease in rent prices. If you don't mind lifestyle changes or longer commutes, living in the suburbs can be very advantageous in your savings journey.
Rent a Smaller Unit or Room
Many rental units divide the rent cost by room size. Larger bedrooms mean paying higher rent. Some rooms also come with walk-in closets or balconies, increasing their rent price.
If you don't mind skipping out on space or additional bedroom features, consider moving into the smallest bedroom on the property. Smaller apartments work the same way. Opt for a more small-scale unit if you want to save a few hundred dollars in rent over the year.
Move into a rental unit that offers cash back
Nothing is better than earning cash back on your regular purchases. So, why does rent have to be any different? New companies are innovating the rental space with these services.
The way these programs work is by connecting property managers to new tenants. For every newly signed lease, new renters can earn over $700 in cash back. Additionally, you don't have to pay application fees. These apartment buildings actually pay you when you fill their empty units and pay your rent on time.
Companies like Lighthouse have been making this service possible. Their mission is to create a mutually beneficial relationship. Tenants find a nice home (and get money in their pockets) while property managers get their units rented out!
Negotiate Your Lease
So, your lease is coming to an end, and you want to renew it. This is the perfect opportunity to negotiate your rent price. After a year, your landlord will know what kind of tenant you are. They will have a good understanding of your cleanliness or noise levels or whether you make on-time rent payments.
It's a common occurrence that landlords increase the rent after a year. If you know you're a good tenant, use that to your advantage to negotiate your rent price. Knowing that they could benefit from having a good tenant in their rental unit for an additional year might incline them to lower or keep the rent price the same.
On the other hand, you can also try negotiating the rent price as a brand-new tenant. This is a harder feat, so you'll have more luck doing so if you have direct contact with the landlord and if you sign a lease during a non-competitive season.
Pay attention to seasonality
It's no secret that signing a lease during the winter months is more affordable. Many people prefer not to move during this season as many places are cold or have bad weather. Rental vacancy rates commonly go up as demand and competition go down during the winter. Due to this fact, landlords decrease rent prices to appeal to new tenants.
Between January to March, rent prices are at their lowest. Data shows that rent prices in the winter for a 1-bedroom and 2-bedroom unit decrease between 2.0%-4.7% and 1.6%-7.1%, respectively. Additionally, the lower demand means that landlords will more openly negotiate discounts.
Save With a Private Rental
There are many private landlords and individual families that rent out units. Unlike property management groups that rent out units in apartment complexes, private landlords will rent out private apartments, guest homes, or even rooms.
Renting with a private landlord usually gives you some leeway. Since they're not a corporation, many don't charge application or deposit fees. Additionally, they are more lenient. Many may overlook prior eviction history or check your background and credit. Private landlords may also be more open to leasing negotiations.
Cut unnecessary costs
Nowadays, entertainment and social media make it real easy to spend money. Yet, the reality is that your savings account can only grow if you cut some of those unnecessary costs.
These types of costs will be anything that fall under your 'Wants' category. They're expenses that you don't need but appreciate having.
Here's a list of some expenses you can cut to save money.
- Entertainment
- Travel
- Memberships/ Subscriptions
- Premium Items
- Cable
- Dining Out/ Coffeehouse Drinks
- Shopping
- Miscellaneous Purchases
Making 'Want' purchases, once in a while, is completely healthy (it'll actually help keep you sane). However, getting rid of most of these expenses from your budget will do your savings wonders.
Cook at home
Getting take-out after a long day has become the new norm. You get a delicious meal at the click of a button- it's just too easy. But that also makes it easy for food to quickly eat up your budget.
Buying groceries to cook at home is the best way to save money. Studies show that the average cost of fast food is $13 a meal (and that doesn't include delivery fees). Yet, the cost of a homemade meal averages at $4.
You save almost 70% of the cost of a take-out meal if you choose to cook at home. If you have the time, it's an easy solution!
Don’t pay rent using a credit card
Most of our credit cards offer some form of cash back in cash, points, or miles. For that reason, many would think that paying the rent with a credit card would be a smart move. We're here to tell you no, it's not.
Firstly, some buildings won't even accept rent payments through credit cards. Larger property management groups usually do. Yet, private landlords typically only take cheques, cash, or transfers.
If your landlord does accept credit, you'll be stuck paying hefty processing fees. Most fees average at 2.59% to 2.90% of the payment total (which is higher than those cash back reward rates).
We did the math, and that's an extra $311-$348 per year for every $1000 of rent, a cumulative annual cost that can easily be avoided.
Get your security deposit back in full
Rent security deposits are expensive. About 1 to 3 months' worth of rent is expensive. Considering it's a few hundred dollars, it's in your best interest to get that money back.
Throughout your tenancy, make sure you don't damage the walls, floors, or appliances. Many people paint or put up items on their walls with nails, leaving holes in them. Heavy furniture or spilled water also commonly damage the floors. This kind of damage could affect how much of the deposit gets returned to you.
Getting your security deposit back should be easy if you take care of your home. Maintain it in good condition, and it'll be smooth sailing from there.
Don’t Damage Your Unit To Get Your Security Deposit Back
Security deposits are typically one month's worth of rent. Considering that evens out to a couple of hundred dollars, it wouldn't be in your best interest to lose it. Throughout your tenancy, make sure you don't damage the walls, floors, or appliances.
Many people paint or put up items on the walls using nails, consequently leaving holes in them. Heavy furniture or spilled water also commonly damage the floors. Keep the unit in pristine condition and leave it in its original condition when you move out to receive your security deposit in full.
Reducing apartment rent can be achieved by negotiating with the landlord, searching for apartments during off-season, considering less popular neighborhoods, and sharing the apartment with roommates. All these tips are effective ways to significantly lower the rent and save money. With a little effort and creativity, tenants can find ways to keep their living expenses in check.
Check out our other posts on how to explore for apartments, prepare for home-ownership and amazing properties that offer cash back on rent with Lighthouse!
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