With competition increasing across the country for apartment communities looking for renters, it can be difficult to stand out from the crowd. With landlords and management companies treating their buildings more like a business, they’re realizing that offering incentives will bring in customers, and keep their current ones happy.
After surveying more than 2,500 renters across the country to get a better understanding of why they choose to rent, what motivates them to move immediately and what matters most when deciding where to live, an industry report found 42% of renters said incentives were “critically important” or “one of a few key factors” to an apartment search.
Renters are looking for a great location, fair price, an apartment in excellent condition, and a responsive management team. If one or more of those factors are inadequate, that’s when a special offer can tip the scales. To help get the ball rolling, we came up with a list of some of the most popular rental incentives currently being offered in the industry. These strategies work – and your building should strongly consider using these special offers to attract new tenants, and retain the current ones.
Early Move In
For many apartment renters across the country, it is a major issue having to move OUT of their old place on one date, and then INTO the next one the following day. How is that possible? Do you sleep with your belongings out by the curb? Rent a UHaul overnight? Allowing renters to move in early, even by a few days, takes a lot of pressure and stress off their shoulders. Consider an “early move in” option for new tenants.
Flexible Lease Terms
A lot of people are concerned about lease terms when they sign on – especially if breaking the lease is difficult and expensive. Offer an incentive of flexible lease terms to sweeten the deal and push away those doubts. The ability to break a lease with 30 days’ notice, or the approval to have pets might be valuable to a renter. Allowing other flexible terms, such as the ability to sublet, will entice a new renter or keep a current one.
Free Rent, Waived Fees, or Money Off
Cash is king. Many apartment communities offer FREE rent for one month, cash back bonuses, or waived fees like security deposit or lock changes. This is where most of your focus should lie, above all the other options. Maybe you offer $20 off next month’s rent if the tenant pays 15 days in advance. Money matters and your new prospective tenants will be tripping over themselves to live in your building with a free rent offer.
However, oftentimes, rent during the 11 other months is increased by 1/11th to make up for it. Without realizing it, this incentive allows renters to spread the first month’s payment over the term of the lease, but gives the impression that they are getting something for free. For better or worse, this incentive appeals to renters with little or no cash liquidity.
Providing in unit washer/dryer is something many renters value highly. Installing a new dishwasher in the apartment can be quite a draw for those who have tired of washing dishes by hand or upgrading an outdated oven or fridge. Giving prospective renters a brand new microwave or toaster oven is a low cost tactic on the owner side, and could help convince renters to sign a lease.
Entertainment or Thoughtful Items
There are some incentives that are really cool, but they are not related to the apartment itself. Some complexes get a little more creative, giving gift cards, iPads, or an Amazon Echo as examples, to folks who sign a lease. You could also work out a year’s commitment with the cable company on their behalf for no charge.
There are also incentives that show the management company and building owners care – like fabric softener, dryer sheets, small kitchen items like an ice cream scoop, toothpaste and toothbrush, or candles upon move in. How about offering to paint one wall an accent color – renter’s choice.
Safety & Going Green
Many prospective renters are concerned about the environment and how your building approaches climate change and similar issues. Having a LEED certified green building is a start, but there are incentives you can throw in that will make these environmentally-conscious individuals want to live there. Items like compact florescent bulbs, high efficiency washer/dryer, house plants, and energy efficient windows. For those who care about safety, include a free fire extinguisher or carbon monoxide detector.
For buildings with a lot of out-of-towners potentially moving in, offer incentives that will help familiarize the customer to the local area. Things like a gym membership for a year, concert tickets to a local band, or a gift certificate to the neighborhood’s best restaurant. They will appreciate the thoughtful gift and the chance to get to know their new home.
Annual Check Ups
Let’s not forget about offering incentives for your best renters. The people that pay on time (and even early) and are never a nuisance. Offering an up-front incentive like a yearly paint job, A/C filter replacement, carpet cleaning, and full apartment cleaning will go a long way towards keeping your top customers happy.
Less Desirable Apartment Incentives
In some buildings, the concessions might be specific to certain apartments that are hard to rent because of odd sizing or other material flaws. If an apartment is near a highway or above a loud nightclub, you may charge lower rent. You might also see these kinds of concessions in buildings in less desirable areas or at certain times of the year when business is slower. You may need to offer any of the other incentives mentioned on this list in the winter months, as apartment moves are predictably rarer.
Have your residents do the selling for you! Offer referral incentives so if they recommend someone to management who becomes a renter, they get a gift.
Up to you!
These are just suggestions to help you get started – you could come up with a whole host of ideas on your own, or consult other properties to see what they’re offering. You could also see these negotiations as a “case by case” basis and offer something you know that particular prospect would want.