There are many reasons we’re currently renting, which I’ll discuss in another post, and there are financial benefits and downsides to doing so.
One potential downside to renting is that we are at the mercy of the landlord, estate agent and market. When market demand is high, rents go up. That’s understandable. But, unfortunately, the opposite doesn’t always happen. When demand is low, as it currently is, existing rental agreements don’t necessarily go down in price. Of course our landlord and estate agent are not going to automatically reduce our rent – this is an investment and business for them and making money is their objective.
When we started renting – 2 years ago – there were very few properties available in the area we wanted to live in. We chose a house that was the cheapest available while still providing us the space we needed, and paid $470 per week for it.
Rents have reduced dramatically in the past two years here in Perth and there is now a record number of rental homes vacant. When our annual rental agreement renewal came up last year I asked for a $20 per week reduction. This was rejected by the estate agent and we agreed on a $10 per week reduction, making our rent $460 per week.
Our agreement is up for renewal again and this time we asked for a $40 per week reduction. This was quite a high figure and we expected it to be rejected, but were pleased with a reduction of $25 per week. This makes our current rent $435 per week. This is in line with similar properties in our area.
By simply asking, we have managed to secure a $35 per week reduction on what we were paying when we moved in two years ago. That’s a saving of $1,820 per year!