Rental negotiation

June 15, 2007 7:58 AM

I am looking for advice on forming a direct relationship with my landlord.

He lives in my street and owns several properties in the street already. I have rented the house for over 3 years now. They bought the house last year. I had an acquaintance with him when he got a relative of his to install the compulsory smoke alarms and he supervised. He seemed like a nice bloke but was all over the operation, (that might be a little bit because he is a medical surgeon and likes to be in charge [totally my take on the interaction, discard if you feel it isn't relevant]).

Today I received this letter from the my estate agent:

Due to the current rental market conditions and increased costs to the landlord, we wish to advise that the rent of the abovementioned property is to increase by $20.00 to $500.00 per week commencing on 25/08/07.
Should you wish to enter into a new Tenancy Agreement, please notify our office and we will confirm instructions with your landlord.

I think that my landlord is fair. He is charging less than the CPI and has given me fair notice. BUT I also think that if I entered into a relationship/contract directly with my landlord that we could both benefit by cutting out the middleman (the real estate agent).
I would like to hear about other peoples experiences regarding: negotiating directly with the owner of the property they rent - mistakes; pitfalls; strategies; successes; did it all go right/wrong?

posted by tellurian to Home & Garden (11 answers total)

I have no idea if this exists, but there might be a contract between the owner and the management company specifying a length of time the house is under management. That would stop a direct relationship entirely.
posted by cschneid at 8:10 AM on June 15, 2007

I believe that people who use property managers do so precisely because they don't want to enter into direct negotiations with tenants. I don't think he'll see 'cutting out the middleman' as a plus.
posted by underwater at 8:19 AM on June 15, 2007

I think, actually, it is the real estate company that is being fair. They probably recommended the rate increase and the landlord approved it.

I rented a condo once in Emeryville, CA. When the condo owner "fired" his management company, we actually had to move out of the condo as part of the transaction. To this day, I'm unclear as to why. Must have been in the contract somewhere.
posted by Eringatang at 8:29 AM on June 15, 2007

Make a friendly enquiry to the landlord. My landlord and I ditched the agent and formed a direct relationship years ago, and it has been a very positive arrangement (but did involve a little bit of duplicity as I remember - nothing illegal).
posted by WPW at 8:31 AM on June 15, 2007

I think underwater is right in the reasons why landlords employ property managers; however, I think there are a couple of indicators that your landlord may be willing to (at some point) cut out the middleman. The fact that he not only lives locally, but on your street, is a plus (as opposed to property managers who live faraway and can't keep an eye on their investments). So is the fact that he tends to be hands-on, even controlling.

At the very least, I'd think you don't have a lot to lose by asking your landlord, either in person or in writing, whether he'd be willing to work with you directly. If the increased rent is benefiting him, it's not likely he'll take you up on this request, but otherwise he very well might be open to the idea. He's paying a monthly management fee (possibly up to 10% of the rent), which he'd obviously save if he dealt with tenants directly. Can you offer some kind of incentive for him, such as extending your tenancy beyond the initial term, to make it more appealing for him?

(Anecdotally, the insane property management company I referred to in this question went belly-up very suddenly, and I've been working directly with the landlord ever since. It's been a positive experience -- I deposit the rent directly into his account on the due date, and I handle small maintenance repairs myself and deduct any costs from the rent. It's actually less of a headache for the landlord that way, without the $300/month management fee and no delay in receiving his money.)
posted by justonegirl at 9:00 AM on June 15, 2007

Best answer: Property management is a skilled profession and if you own several properties it is also a full-time job. Your surgeon probably doesn't want to be bothered during his dinner or woken in the middle of the night to deal with calls about insects and rats, broken plumbing, electric power failures, gas leaks, burnt out bulbs in the common area lighting, broken machines in the common laundry areas, garbage spills from the homeless guy nesting in the dumpster, funny smells coming from the drain, requests for new carpeting or paint, et cetera ad nauseam.

That's why he pays someone to do that for him. He's getting a benefit - he doesn't have to deal with all that. So give it a try, but you're likely to be rebuffed.
posted by ikkyu2 at 12:24 PM on June 15, 2007

Speaking as a landlord, what ikkyu2 said. It sounds like you're hoping to save $20/mo in rent by reducing the increase (and he pockets whatever the PM charges). But then he has to be responsible for everything again. As a surgeon, he's probably authoritarian by nature (boss of the operating room and all that), and by the same token, very busy with other stuff on his mind all the time. He owns the property as a long-term investment, not a hobby.
posted by dhartung at 1:12 PM on June 15, 2007

Let me put in a positive experience: I've developed a great relationship with my landlord, and she recently reduced my rent because she heard I was in a financial tight spot. They really do appreciate good tenants when they come along! It may also help if you can offer to do a little maintenance yourself; nothing a contractor would normally do, but maybe some weeding, painting a bit, or gutter cleaning.
posted by wzcx at 2:48 PM on June 16, 2007

Response by poster: I've decided not to make a direct approach but remain alert to opportunity.
posted by tellurian at 7:59 PM on June 25, 2007

Really, what do you have to lose?
posted by jonathanmartin at 11:58 AM on November 23, 2007

Response by poster: Well, jonathanmartin, there have been developments since I posted this. The price of rentals in Sydney have skyrocketed in the last 3-4 months. Our oven needed replacement 2 months ago and it took 6 weeks for a replacement to be installed (mostly because of the dickering over price). I'm now pretty convinced that the landlord wants the maximum return for the least outlay (not that I blame him for that, but 6 weeks without an oven was difficult). I'm reluctant to approach him now for the same reason you don't whack a hornets nest with a stick. I don't want him to start thinking about how he can increase his return. I'm choosing to lay low at the moment.
Also, welcome to MetaFilter. You should add growabrain as a contact - 'MetaFilter's own' real estate guru, who also happens to have a kick-ass blog.
posted by tellurian at 8:23 PM on November 23, 2007