The economy has continued to increase in its cost of living for years while payroll incomes have remained the same in most areas of the United States. This dilemma has been an effect most households feel directly in their overhead and budget difficulties. Many renters have become perturbed and even attempt to retaliate in some cases towards their landlords / property owners. In many cases it seems only fair that they are angered by the high rental costs for basic housing. Especially when considering most tenants spend approximately on average $14,400 per year for housing they will never own or have any investment in for what they have paid. While this issue can be very stressful it doesn’t change the fact that both property owners and tenants are faced with the same ever increasing economy. While many tenants feel landlords randomly choose to raise rent for no apparent reason there is need for comprehending the expenses involved with investment property rentals. What many tenants do not think about since they rarely if ever see these expense items, they do exist. In the past few years property taxes have increased across the nation forcing landlords to adjust rental fees to make it possible to meet the needs of enough income to pay the annual tax burden. In addition to the tax increases periodically property insurance has skyrocketed again causing landlords to have to make adjustments in rental fees just to stay afloat and maintain their available rental properties. In some instances, a good landlord / owner will on occasion try to renovate or improve their property to be more appealing or updated as times change with styles and technology needs sought by renters that cannot afford to buy their own home and are forced to rent. As can be expected these improvements, repairs, and renovations are never at discounted prices with the ever increasing cost of contractor pricing for such things as carpentry, electrical, and plumbing services not to mention the cost of materials. In turn renters are faced with increased rental rates because the owner has to fund the improvements when needed. On the other hand in most metropolitan areas renters must struggle to find acceptable housing for their families. In most cities to find an updated / remodeled property the prices can be daunting for a renter. What this means is both the owner and the tenant have to find a happy median for both parties involved in the use of the property. Renter’s often forget that the reason they are renting is due to lack of some key factor, no credit or poor credit, cthe lack of funds for a down-payment to buy, the inability to afford all of the items that come with home ownership such as, taxes, insurance, mortgage payments, maintenance and upkeep. While some prefer to rent for the removal of the stresses of property ownership many rent until they are in a position to buy. With these thoughts in mind a renter should take time to consider what options they have for negotiating rent fairly when seeking housing. Many times a tenant may get rental amounts lowered by small amounts if they negotiate with the landlord. For example one of the best negotiation options to get your rent at a lowered price is to offer the landlord / owner a long term lease such as a 2 to 5 year if you know it will be a good while before you can afford to buy. So for example you may ask a landlord if their rent is $1200 per month, to consider maybe $1150 per month at a term of 5 years. This would equate to a $3000 dollar savings to you the tenant over the 5 year term which is a pretty good saving in comparison to the full asking price of the leased property. While the landlord would loose $3000 of income it should balance out over time since the cost of cleaning, repainting between tenants, and advertising to obtain renters would be postponed for a longer period of time. Another option that could help decrease your rent would be to ask your landlord / owner to allow you to lease with a roommate and both parties be equally responsible for half the rental amount. While the monthly rental amount technically does not decrease each tenant has a lower portion of rent to pay monthly. For example if the property rents for $1200 per month this would create a savings of $7200 per year in rent for both roommates. Keep in mind when considering roommate options, the individual should be someone trustworthy as their non-payment of their half could affect your credit scores. It is a good idea for both parties to share their credit report information as a curtesy in ensuring one another of payment history and debt obligations. Also, make sure both individual’s work and social habits are compatible so that both may achieve peaceful living conditions around one another’s schedules. Another often over looked way to decrease monthly expenses is to consider your utility usage habits. Most Americans are accustomed to a/c and heating in there homes. While this is a necessity why not see if the temperature settings can be adjusted to decrease electricity consumption. In today’s time of technology there are many types of programmable thermostats. Ask your landlord / owner if they would consider allowing a qualified professional to change your thermostat to a programmable one. These units allow you to program a/c use by time settings such as decreased use when at work and automatic adjustment for when you usually arrive home. Consider water consumption as well. Many folks shower for extended periods of time without realizing the amount of water consumption they are using. While television has long been a large part of entertainment in American households, many folks are paying extreme amounts to have access to hundreds of channels to view when in fact most only view a handful of these. Considering a decrease in the size of your television services often can lower your bill to one that is less burdensome on the household budget. Another aspect of the American dream is vehicle ownership. Often times the more luxurious the vehicle is the higher the price tag. Although transpiration is a necessity, most people spend less than 5 hours a week in their vehicle for commutes to and from work and normal errands. When calculating based on a vehicle monthly note of $675 per month that equates to $33.75 per hour of use and this doesn’t include monthly fuel, maintenance, and insurance costs. So basically most people are paying more per hour of use of their vehicle than they earn hourly in wages. An economy car, while not elaborate still accomplishes the task of travel as needed usually at a much lower cost. The main drawback of high end vehicle purchases is the item is not a great financial asset for the investment spent. Vehicles usually depreciate more rapidly than the time required for the payoff balance to be met. Restaurants and entertainment often are problems in most households when it comes to overspending as well. Lastly, in the way of your housing choices as a renter it is very important NOT to overspend on borrowed housing. So if you are a single individual that must rent why not reconsider if you need the size living space you currently have. It has been indicated that many single people only use 1/3 of the space of their rented home when obtaining anything larger than a two bedroom space. In some instances even a one bedroom space could suffice for an individual person when the option is available. While all of these are ideas that could be helpful they may not apply to everyone’s situation so, in addition to these suggestions review your spending habits and determine how much is spent on certain aspects of your living habits and determine if any of them could be adjusted. Remember the lower your overhead the more likely a chance of saving towards the goal of homeownership can be achieved! I offer guidance and even assist my clients with planning to work toward buying a home EVEN before they are in a position to qualify as a home purchase takes careful planning and realistic budgeting goals to get in a position to buy a home. Give me a call today if you are seeking to work towards homeownership in the future!

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