Offering Deals to Sign Tenants: The Pros and the Cons
Some landlords and property managers use tactics to try to entice tenants. In fact, you’ve probably seen this. Some offer reduced rent, free rent, or other various discounts to tenants. And, why not? Discounts, rewards, and savings are one of the most popular marketing tools, right? So, it only makes sense that you can find tenants by using them.
Here’s the million-dollar question – will it work?
Sure, offering deals to sign tenants will likely bring you an influx of potential tenants. In fact, you may attract more tenants than you thought possible. Great, right? Maybe. Then again, maybe not.
We’re going to take a look at the pros and cons of offering deals to sign tenants.
Security Deposit Discounts
Upon move-in, it is customary for someone to pay rent due for the first month (and often the last month, too) along with a security deposit. Because of this, the move-in fee can seem a bit hefty. It is all for good reason, though.
Charging first and last rent means you are covered for your tenants to live in your property for at least two months should they decide to not pay additional rent, causing you to go through the eviction process. And, the security deposit gives you money to work with should the tenant cause damage to the property. If they don’t, they get this nice chunk of change returned to them after the move-out inspection.
So, what happens if you decide to offer a move-in deal that does not require a security deposit? Well, you are giving up extra protection for yourself. Without having to pay this security deposit, more tenants may be enticed to apply. However, because they don’t have to worry about getting a refund when they move out, they have nothing to deter them from causing harm to the rental.
Discounting the security deposit then, in a sense, discounts the security altogether.
Use the Right Words
You can move forward by offering deals to new tenants. That is perfectly fine – especially if you have found it helpful to you. However, the way you choose to word your offer can affect how your property rental is viewed.
Some words make a property seem unworthy or that, perhaps, you are trying to get it off your hands and fill vacancies at all costs. When preparing your marketing campaigns, avoid using degrading words, such as:
Instead, choose words that offer value without demeaning the property. These words are:
- Added bonus
How you write your ads is just as important as what you say.
The Deals You Should Be Offering
Give tenants the opportunity to gain some incentives by signing a lease. You can provide things such as added conveniences or added bonuses to what is already a high-quality, desirable rental. Try one of these examples:
- If you typically require your tenants to be responsible for lawn maintenance, consider offering to adjust the lease terms to reflect that you will be responsible for this maintenance for the first couple of months.
- Dismiss additional pet costs. Many people have pets – and they can be expensive to care for on their own. Having to pay additional fees for the pet in a rental can deter tenants.
- In certain urban areas, parking comes with a fee. Instead of reducing rent, consider offering free parking.
Being a landlord and reaching potential tenants with your property is one of the biggest parts of your job. And, for that reason, you want to make sure you get it right. Choose your deals and your wording wisely – maintain the value and quality of your property and entice new tenants.
Marina Shlomov, a managing partner at ALH|Podland Rental Homes Property Management is the author of many articles on Landlording, Property Management, and Real Estate Investing. A residential builder in the state of Georgia since 1999, Marina is an investor herself. Her property management company is intended “For Investors” and “By Investors” for a simple reason – she knows what investors’ goals are and she works hard to reach their goals. In her spare time, Marina likes to spend time with her family, friends, garden, read and travel. Check her out at www.alhpodland.com. You can find Marina’s articles and comments at @rentalhomesatl on Twitter, on Facebook, Google+, Blogger. and YouTube, Bigger
Pockets and REI Club and LinkedIn.