If you’re trying to streamline your outgoings or save for a big purchase such as property then you’ll need to reduce your biggest outgoings. For most people, the biggest outlay each month is their rent, especially if you live in London wherein 2020 the average rent for new tenancies was a whopping £1,645 PER MONTH.
It makes sense to find ways to save money on this expense and their a few novel ways that I’ve encountered over the years to make this a reality.
Look in Advance
If you’re in a current tenancy, then it’s in your best interests to start looking for a new home as early as possible. This gives you the most leverage and time to make the best decision because you won’t be choosing out of desperation.
It also allows you to look at many properties so you can have a better gauge of the current market such as rent rates, rooms sizes and location. Once you have gathered this information it also means you could counter your current landlord with a lower price allowing you to stay in your current property for less rent.
Securing a new let in advance also gives you added peace of mind instead of scrambling around when you only have a couple of weeks left of your tenancy.
Negotiate, Negotiate, Negotiate!
‘If you don’t ask, you don’t get” is a great saying for this situation. Most landlords are open to negotiating especially if the market is slow and the worse they can say is no and you can either commit to the existing price or move onto a different property.
One key tip is when you find a room/house listing is to see how long it has been listed for. If it’s been an active listing for several weeks then you have more leverage for negotiation as obviously nobody is taking the lease. This is another reason why you should start looking as early as possible.
Recommended to also look at similar rooms/properties in the same location so you know the rough rates allowing you to generate a realistic offer. With more people moving out of busy cities such as London this gives you the perfect opportunity to secure your favourite property at a great price.
Live with Flatmates
Sharing property is an easy way to reduce your rent outgoings. Obviously, we’d all like to live in our own space but this isn’t always a reality depending on salary or your savings goals. By living with other people you will have shared space such as a bathroom or kitchen but you can still make your bedroom your own living space.
The more people you live with decreases the price however there does reach a point of diminishing returns so you need to understand your personal max limit for how many people you’ll want to share a house with.
As the number of people in your house increase, inevitably things such as noise and mess will increase. The former is especially if you don’t have matching work schedules with the other housemates. However, I’d always recommend trying to meet the housemates before moving in so you understand the current feel of the house.
Be Flexible with Location
We’d all live to live bang in zone 1 and have a walking commute to work and all the local amenities but one of the main factors in the cost of rent is location.
We’d always recommend being as flexible as you can with the location because if you’re near the right station you can still quickly move around the city. Also, the competition for properties less central is also lower so you’ll have more time to make a decision once you’ve viewed a property without being outbid.
You should also factor in the costs of your travel card into your rent cost because there becomes a point of diminishing returns when you live so far away from your workplace that the cost of travelling eats up any savings that you made from lowering your rent.
Visiting the property in person is also great as you can see in person the local travel links and its surroundings.
Be Flexible with Quality
Let’s be honest, as the rental rate drops the quality of the properties also drops so you will need to decide the level of quality that you’re willing to live in.
If you’re only planning to live there short term while you build up your savings then you can be more flexible, however, if you’re looking to live there for several years you might want to choose somewhere slightly more nice and expensive.
This all comes down to personal preference. So, if you can live in a property that has no living room or has a tiny kitchen then you can save a significant amount of money especially depending on the location of the property.
However, you need to be realistic. Don’t choose a property that’s clearly in horrible shape and has deep issues such as damp because this also shows the quality of the landlord and could affect your overall health.
Take a Smaller Room
Once you find your ideal property, you’ll often have the choice of which room you can take. Of course, the smallest room will be the cheapest so you can save a generous amount of money here compared to others living in the same property.
This will depend on your personal circumstances. If you’re currently working from home then this can be difficult as you’ll be spending the majority of your life in a very cramped room. However, if you’re working on location or in an office then this makes the experience a lot easier.
If the house has a communal area, then this can make life easier giving you additional living space.
Rent Directly from Landlord
Renting through an agency gives you more security of working with an established and registered company however this comes at a premium as they are essentially the “middlemen” who are taking a percentage cut from the landlord.
By removing the agency gives you direct access to the landlord so you can negotiate a lower rate. Sites such as Spareroom and OpenRent allow you to do this, however, this does mean that you need to vet the landlords yourself and if there are any issues with the property you have direct access which can be positive or negative depending on the quality of the landlord.
Pay in Advance
If you have the financial means it’s very common for landlords to accept a discounted rent rate if you commit to making a large upfront payment. This payment can range anywhere from 6-12 months and landlords are usually open to it because it guarantees them a lump sum of rent upfront.
Always ensure that the property is of decent quality because if you’ve already paid all the rent then this makes chasing the landlord for repairs slightly more difficult as they have more leverage.
This arrangement is more common with individual landlords as opposed to big lettings agencies who have higher overheads and can’t be as flexible with their rent costs. Always ask, as you won’t know unless you do.
Sign up for a Longer Lease
Similar to paying a lump sum of rent in advance, another great way of lowering your rent amount is by committing to a longer lease length. Landlords prefer this as it means they can secure rent over a longer time length so they can avoid vacant periods where they will need to actively find new tenants.
For example, if the advert says it’s a 6-month tenancy then propose a 12-month tenancy with a slightly lower monthly rate. You need to understand how long you plan to stay in the area for too.
There’s no point committing to an unrealistic time length such as 5 years when things can change in life. However, regardless of the contract length, you can also negotiate break clauses that allow you to leave the tenancy under certain circumstances.
In a slower market, this is also great if you’ve found a bargain property as this stops the landlord from increasing the price once the market recovers.
Negotiating and pre-planning is a big part of securing a lower rent property. You also need to understand what type of property you can personally handle which will depend on how long you need to live there and your budget. The earlier you start the search, the more simple it will be.