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Re-negotiate lease post 12-month break clause

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  1. #11

    Join Date
    Jun 2011
    Posts
    435
    Quote Originally Posted by cuihua:
    So suggest you check the listing rental price of similar unit before talking to your landlord. You can find the information from agents' website.
    Listing (asking) prices are very different from transaction data after negotiation. In this weak market transactions are done at least 10% below the ask. I suggest to check centaline and other agents who publish actual rental transactions for your building. Unfortunately if its a small building these sample size could be very small to non-existent.

    I came up to my 12 month mark just now, I got my rent down with 8%, we already had a pretty low rent to begin with since protest were in full swing when we moved in a year ago. So 8% reduction was very reasonable and inline with the latest rent transactions in the building.

  2. #12

    Join Date
    Oct 2019
    Posts
    9
    Quote Originally Posted by UK/HKboy:
    I would just keep it friendly and lower expectations. As in I would casually ask, and then if the landlord doesn't offer, be prepared to just leave without making it a confrontation.

    They are under no requirements to give a discount, but you are also under no requirements to stay after 12 months. If the prices have gone down, then there will be similar flats nearby that are lower in rent anyway. If the landlord doesn't want the hassle of finding a new tenant, they will probably offer a discount. If you don't want the hassle of moving to a new place, you will probably just keep paying the current rent.
    This. We kept it very respectful and tried to request a 10-20% discount on our rent. We don’t have a landlord as such, as it’s a company who manages the flat. They put our rent up by 3000 a month citing market conditions around 14 months ago, we have politely asked them to reduce by a similar amount citing the same reasons. They have said no to our requests each time.

    We gently asked this a total of three times over the space of six months.

    Looking on spacious, and square-foot you can find better deals elsewhere that are larger and nicer. Some of the places we visited had been empty for three or four months already. Also opposite where we live we can see a lot of very expensive apartments empty at night. They have all been empty since February. So anyone who says that the market is still the same is telling you porky pies.

    We continued our search, but because we weren’t in a rush to find a new place, we had all the bargaining power. When agents were trying to pressure us, we were very relaxed and said that we do not need to move out immediately, however we could move out very quickly if the right deal was on the table. Eventually we found a place we liked for around HK$4000 cheaper a month, with an extra bedroom and bathroom, much bigger too and so we asked for a rent reduction on our current place one last time. The company said no, (which surprised us as there will be hassle of finding a new tenant as well as the risk of the place being empty for a while) so we decided to do the most powerful protest possible: with our wallet. We wished the company well and thanked them for a wonderful four years in the apartment, and promised that it would be in perfect condition for the next people perhaps crazy enough to pay the exorbitant rent we are currently paying for a walk up building.

    We kept things nice and polite, and at every stage we try to make it obvious that we wanted to stay in our current place. However they have the right to find a client willing to pay what they want, and we also have the right to find somewhere cheaper.

    I’d be polite and just move out once you get a better deal. You can ask them more than once for a discount, but now seems to be the best time for bargains.
    traineeinvestor and TaD_LaLa like this.

  3. #13

    Join Date
    Jul 2006
    Posts
    374
    Quote Originally Posted by LukeUk:
    This. We kept it very respectful and tried to request a 10-20% discount on our rent. We don’t have a landlord as such, as it’s a company who manages the flat. They put our rent up by 3000 a month citing market conditions around 14 months ago, we have politely asked them to reduce by a similar amount citing the same reasons. They have said no to our requests each time.

    We gently asked this a total of three times over the space of six months.

    Looking on spacious, and square-foot you can find better deals elsewhere that are larger and nicer. Some of the places we visited had been empty for three or four months already. Also opposite where we live we can see a lot of very expensive apartments empty at night. They have all been empty since February. So anyone who says that the market is still the same is telling you porky pies.

    We continued our search, but because we weren’t in a rush to find a new place, we had all the bargaining power. When agents were trying to pressure us, we were very relaxed and said that we do not need to move out immediately, however we could move out very quickly if the right deal was on the table. Eventually we found a place we liked for around HK$4000 cheaper a month, with an extra bedroom and bathroom, much bigger too and so we asked for a rent reduction on our current place one last time. The company said no, (which surprised us as there will be hassle of finding a new tenant as well as the risk of the place being empty for a while) so we decided to do the most powerful protest possible: with our wallet. We wished the company well and thanked them for a wonderful four years in the apartment, and promised that it would be in perfect condition for the next people perhaps crazy enough to pay the exorbitant rent we are currently paying for a walk up building.

    We kept things nice and polite, and at every stage we try to make it obvious that we wanted to stay in our current place. However they have the right to find a client willing to pay what they want, and we also have the right to find somewhere cheaper.

    I’d be polite and just move out once you get a better deal. You can ask them more than once for a discount, but now seems to be the best time for bargains.

    Nice story and a reasonable approach if your landlord is a local individual without a portfolio. If it's a leasing co, the approach you described is frankly an utter waste of your time.

    HK leasing Co's don't care, if they own the building it's about rental yield for the building as a whole which affects the value of the property and thus what they borrow against and whether the creditors might call in any loans based on depreciation.

    To have a chance of rent reduction, you'd have to be very direct and spell out the what they'll lose when you move out and how having an increasingly empty buliding will affect yield longer term, even then they likely won't care - but they might - if short term occupancy is important to them right now for some reason.

    Asking politely is not a good strategy with co's.......at all.

  4. #14

    Join Date
    Mar 2010
    Location
    Hong Kong
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    289

    The way I see it, at least for individual / non-corporate owners, many of them are having their own struggles through covid-19. I would not assume every landlord is sitting on a property empire and passing their days eating cakes at Lady M. Similarly, I would not assume every tenant has taken a pay-cut or lost their job. Some tenants are genuinely enduring difficulties and I would like to help them. For those simply having a go at a reduction, I may react differently.

    But of course it's a renters market now, and you have every right to try. As both tenant & landlord, i've not personally asked for a reduction where I live, but have been asked for one by more than one party.

    In considering, i'd look at whether the rent was cheap to begin with. Unlike some landlords, i'm not in the habit of jacking up the price at each renewal; I believe a good relationship should go both ways. Financially, a rent reduction is surely preferable to an empty apartment and agency fees of course... my issue is that tenants obviously never complain if they're underpaying vs. the market. At some point, when it borders on taking the piss, i'd be inclined to say good riddance as a matter of principle.

    Last edited by tparker; 29-08-2020 at 02:05 AM.
    traineeinvestor, Sage, pin and 3 others like this.

  5. #15

    Join Date
    Nov 2010
    Location
    HK
    Posts
    1,110

    Just negotiated a 15% decrease at the end of our first year,

    Identified another similar unit in our building which was listed online for rent well below our current rent and shared the listing with the agent and owner.

    Owner offered 10% discount starting from our 14th month, we countered with 15% plus we offered sign a new 1+1 lease agreement at the same timing and this was agreed.

    We had previously approached twice before in the last 6 months asking for a rent reduction as we watched the buildings around us gradually empty as expats depart HK but had been knocked back - we end up waiting till just before the end of the first year to approach again.


  6. #16

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    Oct 2006
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    Hong Kong
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    Following.


  7. #17

    Join Date
    Oct 2018
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    9

    Also managed 15%, despite having gone in for quite cheap already. The landlord may just be really nice, but it's a tough market out there for sure...


  8. #18

    Join Date
    Jun 2011
    Posts
    435

    I agree with the analysis that there seems to just be an increasing amount of empty flats on the market. I think it means if even economics in the city do improve, it will take a while to eat into this oversupply before rents start to move up again. What boggles the mind is that rents keep decreasing but prices barely budge. I guess it is because USD interest rates decreased so much..

    Last edited by RobRoy; 31-08-2020 at 11:30 AM.

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