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Are you going to renegotiate your rent?

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Wd40
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Are you going to renegotiate your rent?

Post by Wd40 » Fri, 22 May 2020 12:23 am

It is now a renter's market. We know a lot of commercial tenants are invoking Force Majeure and skipping their rent payments. I wonder how is it on the residential side? Are you guys still paying the overpriced old rents?

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x9200
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Re: Are you going to renegotiate your rent?

Post by x9200 » Fri, 22 May 2020 7:08 am

Wd40 wrote:
Fri, 22 May 2020 12:23 am
It is now a renter's market. We know a lot of commercial tenants are invoking Force Majeure and skipping their rent payments. I wonder how is it on the residential side? Are you guys still paying the overpriced old rents?
Force Majeure in TAs is when the property is destroyed or made unusable some other way. Never seen any other take*, so nothing applicable to the current situation unless perhaps your flat was disinfected destroying your belonging and making the premises uninhabitable.

What is going on with the commercial lease is based on some measures introduced by the government. In short, the gov offered a relief to the LLs on the property tax and this relief is intended to be passed to eligible tenants. The commercial tenants are also protected from eviction for the next 6 months or so. Nothing like this for residential lease that I am aware of so I see no basis for any rental renegotiation besides a good will of the LLs or/and the risk mitigation on their side.

*) could be there are, covering e.g. job loss etc, but for the few commercial and residential leases agreements I have seen, it was as stated above.

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PNGMK
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Re: Are you going to renegotiate your rent?

Post by PNGMK » Fri, 22 May 2020 9:05 am

You "might" get a discount or relief if the LL is taking advantage of the gahmens moratorium on residential mortgages (they can be delayed until Jan 2021). I can't see any other basis. Also rents are not over-priced really in terms of returns, it's the property and land that are over-priced. I actually don't expect property prices to drop (in the private sector) but actually increase due to a shortage on the supply side (construction is at a stand still) and demand side (as people try to move back here as a safe haven).
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