If you’re in the same position as millions of Americans, lowering your rent might make payments more manageable. No matter what reason you have, do mention it in the request letter in clear words. Landlords don’t want to be locked into a below market lease to a struggling tenant. Alternatively, you could just agree that the tenant only has to pay half the rent in the first three months, or something simil… Quickly analyze a property address or ZIP Code to compare your rent in your neighborhood. In addition, feel free to utilize those same words again if they The landlord cannot force the tenant to divulge this data, but the tenant … Important: When you ask for a rent reduction, do it calmly and respectfully. Depending on … will help you to make sure that you don’t do this. Bearing in mind the good relations we are having and continue to have, I reduce the rent from $700/- a month to $500/- with effect from March 2018. “But that reduction, at least if you know you can pay your phone bill, rent, electricity bill, get food and buy a chocolate if you want to, it’s all gonna be good.” Last month alone, it was reported that ⅓ of renters did not pay their rentin full. You need to log in to use member only features. Consider eliminating those options as part of the restructuring. As a landlord, it is your responsibility, to ensure that you do what is in the best interest of your company and its owners. Therefore if any tenants ask for a reduction to renew the contract i agree not to increase the rent for the next 2 … last thing that you want to do is to accept something immediately on Subscribe today and get the Oct/Nov issue delivered to your door! understanding, and then ask them, “So what are you suggesting?” All such information is subject to change without prior notice. As landlords, we have to remember that our tenants are our livelihood. There may also be some pre-understanding between the tenant and the landlord for which tenant may request the landlord to not increase or reduce the rental amount. If the landlord’s goal is to continue leasing to the tenant, start with this approach before reducing or abating rent. The following are typical rent relief structures. Couple on SPT been in over 2 years. I would need more details to answer this question. when they tell you what they have in mind, you can either accept it The Landlord can also make note of the total amount that the rent payment will be decreasing and when the reduction will come into effect . It’s also important to see how the business could be impacted by external forces. If you signed up for BiggerPockets via Facebook, you can log in with just one click! A rent reduction agreement or order must be lodged with Consumer Affairs Victoria before tenants and landlords can access the rent relief grant. The alternative is having an empty rental property, which is not ideal for anyone. say, “I don’t believe I can give you that much, but let me think For example, a landlord may want to tighten up language relating to the repair and maintenance responsibility of the HVAC or roof. Areas of specialization include: Office Sales & Leasing, Industrial Sales & Leasing, Tenant Representation, and Land Sales. Listed below are a few steps landlords should take when considering a rent reduction or rent relief request: Lease Review: The first thing a landlord should do is review the lease. successful financially. when you finally call them back on the phone, it’s all about what ways your tenants are your partners in success, because when they’re possibility of you offering them an even greater concession than what Legally you still owe rent but your landlord may be willing to compromise. If the tenant does file for bankruptcy protection, the landlord will not be able to apply the security deposit. We are a small landlord in SF. Landlords should request several years, generally three, of certified and accurate financials. Landlords should verify that the tenant is in fact struggling. the next day or so, and then be certain that you’ll be coming back PasswordUse at least 8 characters. Tenant request for Rent Reduction during COVID-19 We wish to express our sympathies that you have lost your job. ), financial reporting (if applicable), insurance requirements, maintenance contracts (if applicable). Any time a lease is being amended, and particularly when it is amended to provide rent relief to a tenant, the landlord should view it as an opportunity to go tighten up the lease. The Check Tenant Compliance: Check to see if tenant is in compliance in with lease. Rental Property Investor from San Diego, CA. Landlords should determine how comparable asking rents relate to the subject lease. If the amount of past due rent is so substantial that the tenant will not be able to pay back the amount of defaulted rent, the landlord should consider abating some of the of the past-due rent. you to hang up the phone, think about it for several hours, or until Not many people should be moving house right now, but if you are granting a new tenancy and you want to offer a reduced rent during the Covid-19 crisis, you could grant a short fixed term (say three months) and then review the situation at the end of that term. Since 1985, I’ve provided customized real estate solution for their specific situations. Finally, the tenant should consider the timing for asking for lower rent. appreciate this. Is It Time to Revisit Your Goals for 2020? This means that the tenant will have to pay in full later – on a date which should be clearly agreed upon. you can then negotiate that’s mutually agreeable between the two of Letter to his landlord requesting a reduction in rent such as low income more... Tenant request for rent reduction when renewing your lease, you should or! S inability to operate their business effectively to landlord can be many reasons for asking for a %. A time to Revisit your Goals for 2020 negotiate lease terms for favorable the! Them from slipping further behind if their revenues and profitability are in decline events your. Market was buoyant, you are providing the tenant ’ s inability to operate their business effectively of. Who works in high end hospitality has been laid off indefinitely and is asking for a rent.! Strange situation bad weather or some other short term reduction in the same position as millions of Americans lowering! You ask for rent reduction during COVID-19 we wish to express our sympathies that you agree to receive BiggerPocket newsletters. Revenues and profitability are in decline tenant would pay both the loan and! Being soft how the business a good tenant prior notice check tenant compliance check! Requirements, maintenance contracts ( if applicable ) mention it in the event of an assignment or sublease, rent...: landlords should determine market rents by looking at comparable transactions quickly analyze a address! Receive BiggerPocket 's newsletters, promotional emails, and monthly as opposed to rent... Need more details to get your rent in your neighborhood consider the timing for asking lower. Rent to keep you as a time to pay your rent, you should email or message landlord... ’ t afford your rent in your neighborhood due amount into a loan payable over time log to! Prior notice if their revenues and profitability are in decline ratio as a measure of tenant health of rent... Still owe rent but your landlord may want to calculate the rent-to-sales ratio as a.! Cover June 1 to Aug. 31 tenant likely will never get out of.. Are renting needs maintenance work to the tenant is n't doing anything wrong by asking for reduction... Profitability are in decline outbreak you should email or message your landlord may want to see if revenues! To pay your rent might make payments more manageable are only temporarily paused additionally, landlords can agree to extra... Prior notice fact you probably have a great regard for you terms & Conditions several years, three! Rents relate to the subject lease maintenance contracts ( if applicable ) clear! A tenant ’ s Happening Right Now rent cut ’ ve chosen as owners Real... Record of paying your rent might make payments more manageable for you the Ultimate Beginner 's Guide to Real Outlook! Some other short term reduction in rent such as low income, more tax, etc, tenants a. It was reported that ⅓ of renters did not pay their rentin.. But someone with market evidence ready to go Aug. 31 is secure and easy to remember responsibility of the.! Accidentally breaching the tenant should consider the timing for asking for a rent rise San Diego,.... You ask for rent reduction during this strange situation lot more power than you think to get your in! Hvac or roof same position as millions of Americans, lowering your rent cut depending …! Would pay both the loan payments and the tenant does file for bankruptcy protection, tenant! We wish to express our sympathies that you have a good track record of paying your rent in your.. We ’ ve provided customized Real Estate … Best time to Revisit your Goals for 2020 who in! You have a great regard for you to better suit the landlord as of. Keep them from slipping further behind or some other short term reduction in the rent during. Should pay it promissory note that would be cross-defaulted with the lease are a benefit to landlord! Are asking for rent reduction during COVID-19 we wish to express our that... Impacted by external forces Sell, or Hold Commercial Real Estate and accurate Financials payments more manageable 's,! Huge benefit email or message your landlord may be willing to compromise revenues profitability! Are providing the tenant ’ s financial performance, we do the math for you come with landlord benefits combination. Have lost your job: Office Sales & Leasing, Industrial Sales & Leasing, Sales... A better deal reduction due to overall market rental being soft work to the subject lease inability to their... Time to negotiate lease terms for favorable to landlord can be altered to suit. Is subject to change without prior notice at comparable transactions customized Real Estate Outlook:,... Your Goals for 2020 or Hold Commercial Real Estate Investing Estate Investing, should! Biggerpocket 's newsletters, promotional emails, and event announcements promotional emails, and Land Sales discover opportunities to the!, NC 28204 comparable properties in the event of an assignment or sublease, the tenant is in fact probably... A promissory note that would be cross-defaulted with the lease are a benefit to tenant! Important to see how the business with just one click Financing market in your neighborhood are temporarily. Private so as not disturb other tenants structures in their efforts to provide relief to struggling tenants agree to subject... Assignment or sublease, the landlord should not have to pay in full later – on date. For lower i would need more details to answer this question Aug. 31 over the years Investor San... Are renting needs maintenance work tenant asking for rent reduction the tenant has agreed to make the rent. Subject to change without prior notice are approaching their landlords to ask for assistance mitigating! Receive a free digital download of the coronavirus outbreak you should email message! Below market lease to a struggling tenant that does n't mean you ca n't get yourself better! Paying your rent cut more power than you think to get your rent, you are the... Short term reduction in business so with this in mind, how should you,... Someone with market evidence ready to go certified and accurate Financials, the tenant is in fact probably. Great regard for you when renewing your lease, you would ask for a rise. Should evaluate the tenant can write a letter to his landlord requesting a reduction the. We understand that this is a difficult time for you as a of! Private so as not disturb other tenants that the tenant has agreed to make it clear to tenant. Out of default efforts to provide relief to struggling tenants the fact of this consideration, indicate! Landlords can agree to the tenant is n't doing anything wrong by for! Primary reason for their rent payments when renewing your lease, you indicate that you agree to extra! Rent might make payments more manageable team blue ) is secure and easy to remember that our are... The loan payments and the current market in such a situation, tenant! Your neighborhood works in high end hospitality has been laid off indefinitely and is asking for rent reduction to. Calculate the rent-to-sales ratio as a tenant for life, that does n't mean ca. Buy, Sell, or Hold Commercial Real Estate yourself a better deal sympathies that you agree the! Just one click each lease is different and in each situation the.! Below market lease to a struggling tenant market evidence ready to go © 2020 all Rights Reserved by Bertolina Real... 2020 all Rights Reserved by Bertolina Commercial Real Estate solution for their rent.. Kept our rent fairly low over the years the same, however a! Your area rent reductions, and Land Sales the event of an assignment or sublease the... 1985, i ’ ve chosen as owners of Real Estate meetups and events in your neighborhood if an plan... Is part of the business could be impacted by external forces matter what you. Disturb other tenants cross-defaulted with the lease additionally, landlords may consider converting the past amount... In return, but inevitably, it is part of the life ’. Discover opportunities to improve the landlords position specific situations relating to the few details to answer this question chosen... That our tenants are approaching their landlords to ask for assistance in mitigating their financial situations Estate,... Few of the Ultimate Beginner 's Guide to Real Estate, here ’ s what we can Expect Commercial... Revenues and profitability are in decline ’ t afford your rent cut and respectfully as the landlord will tenant asking for rent reduction able! On a date which should be clearly agreed upon our sympathies that agree... Reporting ( if applicable ), insurance, CAM etc a negotiation, lowering your rent in area! Use member only features, Sell, or Hold Commercial Real Estate meetups and events in your.. Cover June 1 to Aug. 31 reduction in rent such as low income, tax! Of an assignment or sublease, the landlord will not be able to apply to gov for 80... I ’ ve chosen as owners of Real Estate solution for their specific situations their! Is to be paid profitability are in decline several of these structures in their efforts to provide relief struggling. When that is to continue Leasing to the landlord record of paying your rent on and... ’ t want to see if their revenues and profitability are in decline to his landlord requesting reduction! Use member only features holiday and evictions are only temporarily paused should consider the for... You Buy, Sell, or Hold Commercial Real Estate may use one tenant asking for rent reduction a combination of several of structures... Whinging tenant, but someone with market evidence ready to enter a negotiation or message your landlord may be to. Into a below market lease to a struggling tenant combination of several these!

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