Lease-signing incentives are common, especially in competitive rental markets. However, incentives shouldn't just be used to get tenants into your properties; they should also be used to keep them there. Tenant turnover can result in thousands of dollars in lost rent, marketing expenses and make-ready fees per month, according to Multi-Family Executive. Retaining good tenants is good business any way you look at it. Incentives that appeal to your tenants' personal tastes, wants and needs may encourage them to sign new leases.
1. Carpet Cleaning
Wear and tear on a carpet can make it look run down even with normal use. Hire a carpet cleaning service every six months to one year to refresh the carpets in your rental units. If you have longer-term tenants, consider replacing the carpet every five years. Refinishing the floors or offering areas rugs are good incentives if you own rental properties with hardwood floors. If you usually replace the carpet after tenants move out, consider letting new tenants choose the carpet color or style that best suits them, even if it's not the most marketable option for future renters. Since you'll replace the carpeting after they leave, allowing them to choose their carpeting is a win - win situation that will help them feel welcome.
2. Maid Service
Your tenants might like to relax after a hectic week rather than spend their free time cleaning their homes. Bring in a maid service, and let your tenants enjoy a day off while the service does all the work. A standard cleaning is relatively inexpensive, while a more costly deep cleaning is a great perk that can make long-term tenants feel appreciated. Establishing an ongoing relationship with a maid service can be very valuable when you need quick move-in and move-out clean up services. The company's employees will already be familiar with your property layouts and locations, and you'll know you can count on their reliability.
3. Household Goods or Electronic Gifts
These items work well for lease-signing incentives and don't lose their appeal once the tenants live in your property for some time. Household goods can include fans, lamps, electric heaters and other items. Electronic items, such as televisions and tablets, are popular options. If you don't have a close relationship with your tenants, poll them for their preferences. You'll want to offer an appreciation gift they actually want and will use. Spending few hundred dollars on items your tenants want but won't buy themselves helps establish a strong landlord-tenant relationship.
4. Gym Membership
Don't have a fitness center in your rental property? Partner with a local gym to offer memberships for your tenants. You'll build local business connections while providing a valuable amenity for your long-term tenants.
5. Rent Discount
The Rent Roll found 52 percent of tenants value monetary incentives the highest, with rental discounts coming in at the top of the requested list. Although a gift is nice, a rent discount gives your tenants extra money to spend on anything they choose. In most cases, the rent discount you provide costs much less than the costs associated with carrying a vacant unit.
6. Appliance Upgrades
Stainless steel kitchen appliances are a big draw for both new renters and long-term renters. These appliances may also be an upgrade if the original appliances in a long-term tenant's unit are older. Plus, you'll already have updated kitchen appliances installed if you do need to show the unit again.
7. Programmable Thermostat
Not all smart home technology is appropriate for a rental unit, but programmable thermostats are a great quality-of-life improvement for tenants. They're easy to install and allow your tenants to control temperatures throughout the day, whether they're at home or at work. Energy-efficient thermostats decrease tenant utility bills and may also be easier on your heating and air-conditioning systems.
8. Included Utilities
Free utility service, such as cable or Internet, is another possible financial incentive. These utilities are sometimes bundled into rental pricing as a new rental incentive, but your long-term tenants will certainly appreciate them too.
9. Covered Parking
Parking, especially in urban areas, is a major tenant pain point. Consider including a covered parking spot or a parking space in a nearby parking garage for long-term tenants. Safe, secure parking can be a very valuable incentive. If creating parking spaces isn't an option in a city, partner with a nearby parking garage to serve your tenants' needs.
10. Grocery Delivery Service
Between friends, family, school, work and social outings, it's hard for many people to find the time for mundane errands like going to the grocery store. If your area has a grocery delivery service, consider picking up the delivery costs for your tenants' orders to allow them to enjoy more time in your rental property.
Good tenants are worth their weight in gold. Spending money for incentives to keep them happy is well worth the expense. When signing incentives prompt tenants to renew their leases, you'll avoid the costs associated with renting out an empty unit and will keep high-quality tenants in your properties.
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