Have you been finding it hard to capture the interest of prospective tenants for your Orlando rental? Or have you been facing more tenant turnovers in the past months? If you’ve been experiencing the following situations then it’s high time to consider new solutions such as implementing rent concessions.
How Do You Define Rent Concessions?
As an Orlando property owner, there are instances where you need to be more flexible with your leasing terms. If you need to generate more interest in your rental, then offering rent concessions could be the right choice for you.
It’s expensive for landlords to maintain a vacant unit that’s why many landlords resort to concessions to drive interest and gain prospects. These concessions are designed to provide a temporary benefit to tenants to inspire them to sign up for a lease or renew one.
Vacant rentals contribute to income loss as you won’t have rental income, but the property will still be generating expresses. So even if concessions might temporarily lower profits, it still beats paying for marketing and maintenance fees in addition to not receiving a monthly rental income.
What Are the Different Types of Rent Concessions?
There are several ways that an Orlando rental property owner can offer a concession. It might be granting a tenant a monthly rent discount, rebates, or giving other forms of compensation. They might even provide additional goods or services that a tenant can take advantage of.
Rent concessions can be offered for a limited one-time, monthly, or yearly term depending on the landlord. Tenants may also bring up the subject and can request concessions. There are different ways that landlords can offer concessions for their Orlando rental property.
Here are common ways that rent concessions can be used:
Waiving Rent for the Initial Rental Period
This rent concession allows the tenant to forgo the first month's rent. while this suggestion might seem extreme and costly, sacrificing one month of rent is better than zero income from a vacant rental property.
If you have someone residing in your rental with the first month's rent waived, then you can predict a budget for those that loss of income. Vacant units however are far less predictable and could therefore be more costly.
This concession can include waiving move-in fees or pet fees so new renters in your Orlando rental property can breathe easier. They can forgo the extra fees of moving.
Even if your rental rate is affordable, everyone knows the stress of moving can take its toll. So people can sometimes choose to remain with their existing rental spaces rather than choosing to move.
Waiving the fees diminishes the financial stress and can entice potential tenants into action.
Security Deposit Waiver
Another barrier you can remove for your prospects or tenants looking to renew their lease is to reduce or waive the security deposit fee. Security deposit amounts are not trivial figures. Some states require twice the amount of the monthly rental rate.
A bit of caution is needed for this concession though. Security deposits cover the loss of income during an early breach of leasing contract or repairing property damages. Having zero security deposit can expose a landlord to risks.
You can consider reducing the price of the security deposit or having it paid by installment instead. to ease the financial burden on the tenant while will protecting your property.
Permitting Tenants to Make Changes
Rental owners can be strict when it comes to maintaining their properties. It can be a challenge to obtain a landlord’s permission to update their Orlando rental property.
Renters wanted to create a sense of home in their rental surroundings. That’s why a lot are glad when they’re allowed to transform their living spaces. You can allow them to paint areas of the unit a color of their choice or allow them to make updates to the space.
By offering this concession, you’re bound to see renters renew their lease because they’ll feel more at home in the space. This will also help foster a stronger landlord-tenant relationship.
Using Amenities for Free
You might consider allowing renters to use parking lots, storage rooms, and laundry amenities for free. This can be a significant advantage for those who have cars, more possessions, and renters without a washer and dryer of their own.
Top amenities are the main driver of tenant interest. When you offer them for free or little charge, renters will be racing to sign the lease of your Orlando rental.
To persuade your existing tenants to stay longer, you may offer new appliances or other improvements in your Orlando property.
You can install smart technology inside the unit. A bathroom upgrade might be what they desire. You can conduct a survey before the renewal period is up to inform you of what amenities renters prioritize or need in their rental homes.
Free Moving Costs
To help your new tenants move, you can influence them further by letting them use a free moving van. Cutting through the hindrance of moving makes it easy for renters to transfer to your Orlando rental property.
Moving is not cheap and it’s also tedious. Offering free items or services associated with moving can push potential tenants to sign a leasing contract with you.
While rent concessions help reduce the vacancies in your Orlando rental property, there are also risks involved. Still, maximizing their advantages pays off as long as you communicate the limited timeframe of the concessions by making it a part of the leasing agreement.
If you would like help managing your properties reach out to the expert at State Property Management today!