November 03, 2007

Bubble Sitters & Bitter Renters - it's time to ask for a discount on your rent


18 million empty homes in America and exploding for-sale inventory

Desperate Homedebtors scrambling to find renters to cover a fraction of their monthly expenses

A wave of foreclosures

Economy rapidly slowing down and millions of REIC jobs lost

Yup, it's time to pick up the phone and ask for a discount on your rent. Start with at least 20% off, in return for signing a new 1-year extension. Call today. You'll be amazed at what you'll get.

And if they don't play ball, move, and negotiate when you do. There's tons of amazing houses out there renting for a fraction of the cost of "owning", in the best neighborhoods, in your favorite towns. Enjoy the good times for renting. You can smell desperation in the air amongst the "owners".

Bubble Sitters - tell your stories here.

57 comments:

Frank@Scottsdale-Sucks.com said...

Oh you can bet I will.

Since signing my lease in March of this year, rents have dropped substantially. I'm at $3,500 (which was low at the time) but now comps are asking $3,100 rent and sitting vacant.

If they won't negotiate, we'll move into a comp down the street for 15% less.

Anonymous said...

Got a rock bottom rate for my new place. Other LLs were charging over 2k/month a few years ago for TH rent in NoVa. No one is getting that now, so its putting added pressure on LLs. Rental places are now employing the same condo sign spinners, tons of former condo units are coming on line as apartments. They offer free rent, free parking, free utilities etc., but just like when they were selling them as condos they will not do want needs to be done to move the units, CUT THE DAMN PRICE!!! One I visited that is employing spinners called me back out of the blue months later. I'm sorry I found a bigger place nearby from a private owner that missed the biggest sell opportunity of a lifetime and is now just happy to rent it for hundreds less than you were willing to go on your smaller places with amenities fees, the smells of sewage in the AM and beltway traffic noise all the time, good luck, thanks, buh bye!!

Anonymous said...

Asked my LL for a discount and he said he couldn't do it.
I dont think he knows that he wont get what i pay now when he re-rents it at the end of the month.
Nice guy I feel sorry for him, and it's not like he flows postive with what I pay.
towjam
Member(yes still making $$) REIC.

LauraVella said...

Our rent is expensive because we live in the bay area. Rents for condos here on the island are $1600-$2300mo. Our rent was advertised as $1,850, but when we signed the actual lease, it went down to $1,800.

This place is spacious and nice, but in reality, it's only worth about $1,600.00. When we signed the lease, I asked the owner if the rent goes up every year, she replied with a little laugh, "only a nominal amount".

I think in May we will be renegoiating a lower rate on our new lease...

keith said...

Someone I know in Scottsdale Arizona after not being able to rent out their house for four months after the prior tenant moved out just took a 40% drop in order to land a tenant

high end home in mcdowell mountain ranch

When all the REIC jobs and easy money go away, rents crash. Plus Phoenix has 100,000 unwanted homes for sale.

You'll probably see even better deals in Miami, Vegas, San Diego, Dallas, Atlanta, Detroit etc, especially cities based on fake REIC economies

Anonymous said...

In Manhattan I asked for a decrease and my landlord told me to go fuck myself. No joke.

Rents here are going up 6 - 8% this year.

Wake up Keefer, real estate is local.

-

zoiks said...

I am not going to be asking for a rent discount. The reason is simple: I already pay a very low rent, which is demonstrably lower than comps. One thing is I've cultivated this landlord (actually landlady) for years. She knwos she can trust me to take care of the place and pay rent on time. So my rent stays low. She doesn't mind as she's quite wealthy and charges rent more on principle than on the need for cash.

Anonymous said...

I live in the mid-west, and am constantly flabbergasted by the rents that are being paid on the west cost.

I know that it’s all relative (higher incomes, higher rents, etc), but $3500/month rent just sounds insane to me.

Is everything that expensive on the west coast?

How much does a 2-litre pop and a pack of smokes cost?

If you can give up the rush hour and crazy political views, you can rent a 4-bedroom house for about $1000/month on this side of the world.

Mark in San Diego said...

Even after the San Diego fires took out 1500 houses, there are still 72 "reduced rents" on Craigslist this morning for SD. . .I have been tracking this figure for 6 months, and what started at about 20 a month is now always between 70 and 80 listings. People who were burned out, want to stay in their school districts, so only a few areas near the fires have had rent increases. . .now that another 1000 downtown condos and apartments have/will enter the market we will see many more reduced rent signs.

I may move from my 3 year old condo to a brand new place just opening - the rent advertised was $200 lower than what I am paying.

Anonymous said...

lv: San Francisco has various rent control laws, so that distorts rental markets.

They can adjust arbitrarily when a new tenant comes in, but only a little bit after that.

So landlords jack up the rent for new tenants to take the risk that they will stay there for long enough that they'll lose out.

SeattleMoose said...

I rent a 2 bed/2 bath 1930's rambler that needs repairs. Rent is $1895/mo.

Seattle is, always has been, and will always be...special. Everyone wants to live here for the 8 straight months of cloudy gloom. Even this last summer was only about 30% sunny.

Anonymous said...

I live in an apartment in NoVa. The rental office says rental vacancies are way down because no one moving to the area is willing to buy.

Anonymous said...

I asked for and received a $100/month reduction on my second year renewal. Woohoo!

Semper Augustus said...

I have a little less leverage since I'm now on a month-to-month agreement (no lease). But it's worth it- I'm thinking about moving to another part of the state, and this gives me the freedom to pack up and move anywhere I feel like (having no debt or other attachments helps). Recurring bills make up 25% of my gross income.

Anonymous said...

I dont think rents in Los Angeles will be going down any time soon. Reason: Illegal Aliens.
Although there are laws on the books in this city that state a maximum amount of people can live in a unit, per bedroom, this is completely and conveniently IGNORED by landlords and city officals.
Its not unheard of where you will have multiple families with upwards of thirty to forty people (mostly adult male Mexicans) living in a three bedroom house (with dozens of automobiles sitting on the lawn leaking oil into the ground and causing a huge eyesore for the neighborhood.)In fact what was once a formerly nice quiet neighborhood, now I cant even find parking on my own Block, for crying out loud!
Not to mention loud parties late in the night, deliberate horn honking to disturb the peace, and when you call LAPD, they come 2 1/2 hours later.
And lets not forget that any old brush can serve as your public urinal. Unbelievable, yes, but so very true.
Meanwhile multiple people living in one rental unit (although technically illegal) keeps the rents artifically high (inflated).
And what's most scary about this, is that I am not talking about isolated incidents or select neighborhoods. This is a scenario that is spreading everywhere you have Mexicans moving in.
Is this their idea of driving "unwanted" people out? A "gringo" neighbor of mine believes it is and this is all part of la "Reconquista" which is an effort to drive "Gabachos" (that's a racist term Mexicans use when they are referring to Americans) out of their neighborhoods. Anyways, the RENTS ARE STAYING HIGH- BUT the neighborhoods are still turning BROWN and WHITE flight is moving on OUT!

Anonymous said...

Anon

Are you referring to that place on Eisenhower, near the PTO? Where did you end up getting a place and how much? I need me a rent reduction.

Anonymous said...

This is something most renters don't have the courage to do, negotiate hard. I rent near the beach in Florida for 80% of what my neighbors who rent, pay, and I have unilateral options to renew at predetermined rents for years in the future if I want to exercise them. If not, I bail. Cash rich renters can also exploit the cash-hungry nature of homeowners by also offering pre-paid rent in advance. Landlords can't resist it and will usually spend it all before the pre-paid term is up, making rent negotiation of the following period very easy : )

Try it. It works like a charm.

Anonymous said...

but none of them places are worth 500 bucks a month.....

Frank@Scottsdale-Sucks.com said...

Someone I know in Scottsdale Arizona after not being able to rent out their house for four months after the prior tenant moved out just took a 40% drop in order to land a tenant

high end home in mcdowell mountain ranch


I remember even back in 2005 Scottsdale was a tough market to be a landlord, always more houses than tenants avaiable, when I was looking at places landlords were just renting them to the first person who would sign a lease without even running a credit check.

Anonymous said...

best things one could do for their community today in the pre oil collapse maybe society is to plant food crops everywhere, not unlike the forest dope planters, and build speed bumps....

Anonymous said...

Not in Los Angeles, unfortunately; not yet, anyway. Maybe next year, when the unsold condo's are put up for rent. But the vacancy rate for rentals is still around 2%; prices are still high (average rent in L.A. is $1700/mo)

Anonymous said...

I pay 1255 rent for 2 bdrm plus 20 for covered parking month-to-month in Fremont, California (Bay Area). My LL send me a letter on Oct. 1 saying my rent will go up to 1510 + 35 on Dec 1. That is a whopping 20% jump. On Nov. 1 LL raised the rent to 1560 + 35 to be effective on Jan 1. I think the manager of our apartment complex has totally lost it. Our complex is 50% empty and she is trying to raise our rent :) BTW our W2 income is over 240K - imagine the money we save laughing our way to the bank. Thinking of suing the LL. Would love to skin this pig. She thinks we are poor to afford an attorney - jokes on her!!!

AmazingRuss said...

I just got about a 20% increase...1100 to 1300. 2200 sf ranch on 3.5 acres on the California central coast, house and land probably 'worth' 900k, so I'm not bitching. They could probably get $2500 or more.

First increase in 6 years...I knew it wouldn't last forever. Probably safe for another 3, at which point, we are getting the hell out of Cali. It's knock your eyes out beautiful where we are, but just too damn expensive.

But then again, maybe not so expensive in 3 years...

Anonymous said...

Seattle is, always has been, and will always be...special. Everyone wants to live here for the 8 straight months of cloudy gloom. Even this last summer was only about 30% sunny.


That's absolute bu11$hit. We barely had any rain at all this summer. Not even that many cloudy days.

Now go ask the residents of Atlanta if they'd like to live in a city with a reasonably secure water supply.

keith said...

If your landlord or desperate homedebtor tries to raise your rent because their toxic loan is resetting, or their costs are going up, tell them you could care less.

Their costs have NOTHING to do with the market price of their rental.

The market sets that.

If they don't LOWER your rent, move. Period. Or threaten to move. They'll play ball. Or they're dumb.

Anonymous said...

My rent has stayed even the past 4 years while inflation has taken off. Two of my neighbors moved out months ago and their units are still sitting empty. If I don't get a reduction next year, I will be vacating.

Anonymous said...

There is a gaining school of thought that just like there is a "natural" level of unemloyment there too is a "natural" level of home ownership. And while these numbers may change slightly over time any significant change over the short run results in economic dislocations. Ex: if uneployment is pushed down by 1-2% within a year then inflation usually surges. Likewise there are a group of people that should not own homes. This is not derisive but simple economic fact. College kids, young mobile workers, itinerant workers, lower income families with volatile income. The list goes on. We are seeing a slide in the rate of home ownership right now. If it reverts to the long term mean then we have about 3%+/- more home owners that need to sell. That is millions of homes that will have to be sold to investors who won't buy them unless the rent covers the mortgage reducing prices further...

Frank@Scottsdale-Sucks.com said...

Not in Los Angeles, unfortunately; not yet, anyway. Maybe next year, when the unsold condo's are put up for rent. But the vacancy rate for rentals is still around 2%; prices are still high (average rent in L.A. is $1700/mo)

Come on down to Orange County. Rents are falling here.

If your landlord or desperate homedebtor tries to raise your rent because their toxic loan is resetting, or their costs are going up, tell them you could care less.

Their costs have NOTHING to do with the market price of their rental.


Agreed 100%. Their financial stupidity is not your responsibility. The market is the market and if they won't play ball, another landlord will.

When I was looking at rentals 9 months ago in preparation for moving, we almost leased one right down the street from where we live now, but at the last minute the desperate homedebtor decided to sell intead of rent.

9 months later, that house is *still* sitting there vacant. They've even given up on the weekly open houses finally. They dropped their price from $1.2M to $1.1M while comps are now selling at under $800k.

That'll be a foreclosure soon.

WaitingToBuy said...

My LL works in investment banking for HSBC in NYC. He is underwater by a lot on the house i rent (he baught in 2005). Earlier in the year when he tried to raise the rent 20% his logic was you should see how much my mortgage is on this place. HAHAHAHA ... i laughed in his face.

Ended up with no price increase. He did not want to lose 3 months of rent $$$ finding another tenant.

Cranes Everywhere in Seattle said...

"Seattle is, always has been, and will always be...special. Everyone wants to live here for the 8 straight months of cloudy gloom. Even this last summer was only about 30% sunny."


"That's absolute bu11$hit. We barely had any rain at all this summer. Not even that many cloudy days."

It was still a shitty summer. Stop trying to spin things so that you can sell your condo. Be a good FB and rent it out for the sub-40% that you deserve!

"Now go ask the residents of Atlanta if they'd like to live in a city with a reasonably secure water supply."

I know people from Atlanta. None of them would want to live in Seattle regardless of the water situation.

Anonymous said...

It's all fun and games until your LL decides foreclosure isn't a bad option after all, and you get thrown out on your ass.

The vast majority of the foreclosures happening right now are not on the primary home of the owner. They're just simply walking away from their "investment" properties.

As things get worse some of you who're reading this and renting assuming you're safe are gonna have a rude awakening when the Sheriff comes knocking on your door saying you have 3 days to leave.

I'm not saying that you should be owning either. I'm just saying it doesn't matter if you own or rent this collapse will be hard on everyone. At least owners know how far behind they are and won't be surprised...

michael said...

didn't you say just yesterday that we were in store for hyperinflation?

Anonymous said...

My rental properties in San Diego command higher rents this year than ever before. But my tenants and I have a good relationship, their rent is lower than the comps, and I like to help them prepare for future buying opportunities. When I do sort through the pool of applicants I dismiss those who sue others for frivolous reasons. Those with chips on there shoulders don't get the best of me. Some of you responders are very juvenile. But sometimes I find good info on this site.

Anonymous said...

Houses are like computers these days. They just keep dropping in value while the cost of everything else goes up.

keith said...

Flat and declining rents will keep down the government's inflation number FYI

That's why you need to do your own calculations

Anonymous said...

baltimore suburb 2BR/2BA apt rent on my new lease raised by $50/month. i don't like to haggle and am tired of moving so just signed. not worth the hassle.

Macaca

Frank@Scottsdale-Sucks.com said...

It was still a shitty summer. Stop trying to spin things so that you can sell your condo. Be a good FB and rent it out for the sub-40% that you deserve!

I visited Seattle once, after a friend moved there. He lived in NYC and was an energetic upbeat guy but was never the same after moving to Seattle and he eventually attempted suicide. I went to visit and what struck me most was how grumpy and cranky everyone was. Most people walked around with an empty, vacant stare, or looking down at the ground all the time. Why do people live in that weather and put themselves through that? Hell I'd go back to Scottsdale over Seattle.

eagle eye said...

Just sold my house and have been sitting the bubble out by staying with relatives. We check the local real estate listings daily and have been monitoring deals on new construction like a hawk.

If we don't find the deal we're looking for, we will rent.

Anonymous said...

"It's all fun and games until your LL decides foreclosure isn't a bad option after all, and you get thrown out on your ass."

You just need to learn how to negotiate the "cash for keys" deal.

Renting from an FB can be a real money maker for us BH's!

Anonymous said...

I have an apartment in center city Philly. My rent went up 5% last year and 5% this year. I asked that I get no raise this year and they basically laughed at me. 235 units in the building, 1 one bedroom vacant and 3 two-bedrooms vacant. That's over 98% occupied. Rents might be going down in the burbs around here, but definitely not in center city.

Anonymous said...

> As things get worse some of you who're reading this and renting assuming you're safe are gonna have a rude awakening when the Sheriff comes knocking on your door saying you have 3 days to leave.

That's not true- you should read your state's laws regarding tenants. That sounds like something a realtor™ might say during the sales pitch to an uneducated buyer.

Agent #777 said...

Haha...
Check the Orlando Sentinel classifieds today. I believe I saw 3 houses 2700+ square feet renting for $1300 or less in Sanford. Likely still the "cookie-cutter" hoods, but built in the last 3 years.
Last week I saw an ad for a 4/3 in a golf community in Lake Mary for $1500/month. Houses there start in the high 300's, and go up from there. The ad is no longer in the paper now.

Anonymous said...

Jesus, is every loser that frequents this site a renter? Buy a fucking house for Christ's sake. How old are you fucking idiots?

zenkat said...

Not all bubbles are created equal.

Here is the Bay Area, the tech job market is zooming into overdrive and employment is high. Therefore, the collapse of the subprime market and the flight of entry-level buyers is driving rents UP, since you still have to live someplace if you have a job here.

It will be interesting to see how the P/E rations balance out at the end of all of this. The subprime teaser rates actually held rents down in these parts, thus reducing the effective earnings you could get on your property. The scale is now tilting back in the other direction ...

(Note that this only applies to the core Bay Area counties: SF, San Mateo, Alameda, Marin, etc. You're still f***ed if you're living in the Central Valley or outlying counties like Solano and Sonoma ...)

Anonymous said...

Here is a rent reduction story all you "bitter renters" will enjoy.

We rented a huge house that had a mother in law apt./ garage in the rear. The landlord turned
it into a second living unit to try to get his "investment" to cash flow.

What he failed to mention was that the utilities were kludged together with only one electric and gas meter serving both living units. To make matters worse he didn't bother to get any permits to do the conversion.

To make a long story short, we called in the inspectors, and the s#it hit the fan! Bottom line: four months free rent, and eight months of free utilities!

Hamburger Flipper said...

Rents are going up, not down, in Portland. Few deals to be had. Your Mileage May Vary (YMMV).

Anonymous said...

As things get worse some of you who're reading this and renting assuming you're safe are gonna have a rude awakening when the Sheriff comes knocking on your door saying you have 3 days to leave.

You are full of s#it!

The sheriff knocking on your door with no warning is NOT the way it happens! A legal eviction proceedure has to be followed, and that takes time. It can take a LOT of time if you contest the eviction in court.

Demand a Jury trial and see how long you get to stay rent free!

Learn your States LL and Tenant laws, they are your best friend!!!

Anonymous said...

It was still a shitty summer.

What are you? Some dumbass Microsoft new hire? You do know weather statistics are available, right?

Stop trying to spin things so that you can sell your condo.

WTF? From my disagreeing with you on the summer weather you managed to deduct that I own a condo!?!

I know people from Atlanta

No $hit! You were probably born in that rat hole. Consider yourself lucky uncle Bill brought you here to shine his shoes.

Anonymous said...

We knocked down our Floplord by $ 300. per Month what he advertised he wanted for rent & made him pay the $ 150.00 Monthly HOA fees to boot.
We are looking forward to getting a MUCH larger house for the same rent this time next year!!
Do I mind moving - hell no, not when I can live in a 5000 sq.ft house for 2K a Month!

Yep, NoVa is a tankn'!

Glad I sold in 2006 :) !

NOVA said...

Funny, I charge $75 MORE a month for the condo I rent with the new contract.

And if I asked to pay less rent where I live now, they'd kick me out. I wouldn't be able to find anything equivalent for even $100 more a month. Price you pay for living in the best areas...

Agent #777 said...

As things get worse some of you who're reading this and renting assuming you're safe are gonna have a rude awakening when the Sheriff comes knocking on your door saying you have 3 days to leave.

It won't be me. Public records and delinquent property taxes are available on the internet in our county. My LL owns 3 units in this complex, with no mortgages.

My apologies that later posters don't seem to understand that your rights go out the window if the place is foreclosed, though I think the time frame is 10 days.

Anonymous said...

There's a two-level rent system going on here. For couples and families who need a 3-bedroom house, yes a rental bargain can often be found. But we singles wanting only studio or one-bedroom or two-bedroom apartments are in trouble. The rates are going up quickly for us and I believe the situtation will only get worse as more families, couples and individuals go through foreclosure and try to rent a cheap place to rent....

resisting husband said...

my lease is coming up in a few months. I looked on lexis and found out what my new FB/Floplord paid for the triplex i live in....$450k. The rent per unit? $850.

I cant wait till he calls me to say the rent is going up $50 and i have to tell its changing by $50, but the other way.

Anonymous said...

I visited Seattle once, after a friend moved there. He lived in NYC and was an energetic upbeat guy but was never the same after moving to Seattle and he eventually attempted suicide.

Love it! Natural selection at work. To think that this guy was polluting the gene pool in NYC...

Anonymous said...

Oh, I wish we could. But this is about the only unit in the area that takes pets. We've been through four landlords in it, and have cultivated every one so the exception for our cats get written into the sale contract. (The other three units in the building are no-pet)

On the other hand, out rent hasn't changed for those three years either, they have kept that in the contract as well. No clue if the two go together or not. There are six identical, near-condo buildings on this block, all of which have changed hands at least once in the past two years, and we have the lowest rent by an easy $150 if not more, for the same unit. And still $200 less than the average cost of renting a similar sized home. And in this area if you rent a home they usually make you responsible for the water bill and they yard work.

No, we'll keep it as is....but I can't say I didn't think about it.

Anonymous said...

You never seem to account for the costs of moving in your calculations. Is it really worth saving $500 or $1000 a year in lower rent to put up with the hassles of moving? Not for me me.

If I move it costs me $1000 in moving costs since I am not about to start moving couches. Plus at lest 25 hours of my time in packing, unpacking, searching for a new place, etc. I value my time at $100 an hour. Meaning my total cost to move is $3500. I would have to get a $292 a month discount for that to make it worth my while.

Anonymous said...

My lease just expired and I am now on a month to month. I pay $1700 for a 2700 sq ft home, with a pool on 1.5 acres of land. Gorgeous home in old established neighborhood of $550K to $1M+ homes.

I am month to month now and told my LL if he intends to raise the rent, don't bother. Just send me a 30 day notice since I will not pay more in rent. I didn't ask for a reduction since I think I am getting a fair price as it is. But I also make $200K a year and have a 790 FICO and told him it would not be in his interest to give me up as a tenant to maybe squeeze an extra $100 a month from an unknown entity.

He agreed and said stay as long as I want. He's a good guy and realizes the untangible value of having me as a renter. I've been there for a year, I pay on time every month. Aside from the A/C dying in the summer, I haven't asked for any repairs. I'm handy and will take care of small things myself since I enjoy fixing things. That alone probably saved him $500 over the past year.

A tenant with a history of paying on time and not destroying the property is worth a lot to a LL. Smart LLs recognizes that value. Dumb ones don't. Use this to your advantage when negotiating and point out the obvious if you have to.