I was wondering what people used as incentives or gifts for their tenants. Do you give them anything to keep them happy, like new doorknobs, or fans or things like that?
What are the best incentives you've used??
The absolutely, positively best incentive I've ever used on tenants is this:
I don't evict them if they pay on time and keep all clauses of their lease! No other incentive expected or required, this is a BUSINESS relationship, not a DATING relationship.
Reading through some of the other threads, I just saw a new one I never thought about - High Speed Internet. Although it could become a costly expense, I think potential and current tenants would respond very positively to free high-speed access. I guess you figure around $50/month (less for others), just another write-off.
Other incentives I've heard people use do include new a/c units, fans, and upgrades in hardware like towel bars and the like.
I hope we can revitalize this thread and hear about other new ones like the fast internet. :groovy:
First month free seems to be a good incentive to getting people in the door. Also, offering a small discount on rent if it is paid before it is due can help. Of course there should be a sharp stick if they are late as well.
What about installing a washer/dryer?
I am kind of a data hound, so...wanted to share some of my conclusions from the American Housing Survey of 1995/6: [comments are mine from a paper written on the subject, not from the study directly]
"On average, renters move out most commonly due to factors not influenced by the owner/landlord such as a new job, job transfer, to shorten the commute, to purchase their own home, or to move into a larger unit. Remarkably, fewer than 6% of tenants cited moving because the rent was too expensive, which may suggest that rent increases are not the primary—or even a common—reason for moving out. Amazingly, when renters were asked to identify the main reason for choosing their current rental unit, “kitchen,” “exterior appearance” and “quality of construction” combined for less than 3% of the total responses while answers relating to issues largely beyond the control of the landlord totaled the remainder, e.g. location. These should be factored in when determining whether or not to offer rental incentives as a matter of practice, whether or not to increase rents on an annual basis (to keep up with inflation or mirror increasing market rents), or whether to spend money upgrading the kitchen in your rental apartment ." [specific table @ http://www.census.gov/hhes/www/housing/poms/pomtsum4.html]
--I should caveat this by saying that I definitely offer free high-speed internet access whenever possible to get people IN the door. Once they are renters, just keep the rent increases modest, don't run them out of dodge. Everyone loves a $25 Starbucks or Blockbuster gift card, but it won't make the difference between staying or leaving for anybody. The lesson I am slowly learning over the years is that the best incentive/treat for tenants is to be professional, incredibly responsive and efficient, and totally businesslike. Few people go looking for a rental apartment because they want to make best friends with a landlord! :pup:
Oops. Need to add here that my comments above apply only to incentives to "keep tenants happy" versus incentives to get them in the door. To get them in the door, you can use a lot of different techniques. Surf this forum for ideas like:
-paying moving expenses or moving truck fees (my favorites)
-discounting first month's rent
-paying utilities, etc.
The key there is the reduce the transition costs for your tenant, both financial and psychological. Make moving into your place easier and cheaper than moving in elsewhere and they should respond.
I have tried incentives before and free give aways do not work! They are a waste of time. The most I will do is $100 off first months rent! I feel giving a month free is just too much.
purchasing without competition
Here's another one:
Include Renter's Insurance and let everyone know it. This sounds great to renters, and it is usually very affordable. You can even raise the rent to reflect the costs of the additional insurance. Usually works best for middle income rentals.
I always give my tenants a small gift around the holidays, and if something breaks in their apartment, I always try to replace it with something nicer than what was there. These things won't make a tenant necessarily stay longer; moving is generally due to other factors. However, maintaining a good relationship with my tenants is very important to me; not only are they my neighbors ( I live in the lower unit of my duplex,) but I am also counting on them to take good care of their apartment.
Let me bounce this off y'all: I was thinking about offering free high speed internet, as well as free phone service, via packet8 or some other VOIP company that offers unlimited local and long distance. It might even be possible to find some package deal that would let you include cable too, for not that much more. Seems like it would kill two proverbial birds with one proverbial stone. Not only would it be a nice incentive, it would ensure that you always know your tenants phone number.
It may be rediculously clear to everybody that I am a complete newbie. If it is, I'm counting on you to set me straight. Thank you.
Create Lasting Wealth Through Real Estate
Join the millions of people achieving financial freedom through the power of real estate investing