Singers who want to rent apartments in popular urban areas face some tough challenges. During the height of the pandemic, when people moved out of cities in droves, renters had their pick of good deals. But now that many former residents have returned, the good deals have vanished.
Today, it’s hard to find a decent apartment at a reasonable rent, which, according to experts, should amount to less than 30% of your annual income. High interest rates aren’t helping the situation: More would-be homebuyers are renting instead of buying, adding to the competition for rental units.
That said, there are strategies renters can adopt to make things easier on themselves. I spoke with Brian Zrimsek, industry principal at MRI Software, a real estate technology firm, to learn about these strategies. Zrimsek has been compiling data on multifamily leasing since the beginning of the pandemic, and he told me about patterns and trends that renters can use to their advantage.
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Seasonality
According to Zrimsek, one of the most important concepts that renters should familiarize themselves with is seasonality. Typically, the “hot” leasing season is the summer, but rents begin rising in April. The traditional peak is August, the month where you see the most move-ins and the highest rents. This is hardly surprising when you consider that many schools start in September.
Although the pandemic wreaked havoc on traditional seasonality, Zrimsek reports that the market has reverted to its usual norms. That means that renters should do their best to avoid leasing in the summertime. Better deals will likely emerge after the school year starts and rental rates decrease steadily until the wintertime, when they usually sit at their lowest. Few people want to move over the holidays or when the weather is cold or snowy. Therefore, this is exactly when savvy renters should plan their moves. Can you stay with family or friends during the summer and early autumn? If you can wait until winter, you’re likely to find better deals.
If you can’t wait, you still may be able to leverage seasonality. Some apartment owners and managers might welcome a lease agreement that terminates in the hot leasing season. Say you move into a new apartment in October. In return for a lower rental rate, you could propose a nine-month lease term instead of a 12-month lease term. That would mean you’d move out in August and the owner would probably be able to lease the apartment for a higher rent. But keep in mind that if you want to renew, you’ll be the tenant stuck with the increase. And if you don’t want to renew, you’ll have to search during the peak season.
Other Considerations
Make sure to do research on the local market before you begin your search. In some markets—especially in the Sunbelt—supply of rental units is exceeding demand. That means apartment owners and managers may be willing to offer concessions as an encouragement to lease. If you can negotiate a month’s free rent, a common concession, that will reduce your overall costs. Just remember, however, that few owners will offer a month’s free rent for renewals.
Regardless of seasonality, you can probably save money by signing a longer-term lease. Landlords typically prefer these because it costs a lot to prepare and market a vacated unit for rental. Your rent might be a little higher for a two-year lease than a one-year lease, but you won’t be subject to the increases that usually accompany renewals.
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Some owners and managers will accept a reduced security deposit, especially if you have good credit. That could help your cashflow if your budget is tight. Some also offer rent payment services that give tenants options to pay in installments rather than once a month, reducing the risk of late fees and helping tenants build credit.
You’re probably wondering when it’s appropriate to negotiate and how aggressively you should do so. Let your research guide you. What are the average rents, lease terms, and concessions in the neighborhood you’re targeting? Have new apartment communities recently opened there? If so, increased competition among landlords could exert downward pressure on rents at other communities in the area.
Much of this information is publicly available. Just keep in mind that rents will vary according to a building’s condition, level of service, and amenities. A unit in a doorman building with several elevators and a rooftop pool will command far higher rents than a unit in a five-floor walk-up with no doorman or security. Research will also tell you if you need to look at a different neighborhood that better fits your budget.
“It’s a tough market for renters whose incomes are limited, especially if they have school loans to repay,” says Zrimsek. “But those who time their searches wisely, arm themselves with knowledge, and manage their expectations should be able to find living situations that may not be luxurious, but are reasonably economical and comfortable.”
