If you own a property, you know that the number one way that you are making money is by having the unit filled at all times. This means you might have to consider some things if you are unable to keep reliable tenants. This means that you might have to consider deals or incentives to get them to stay. Over the course of this blog, I, Mark Roemer, am going to be discussing some different ways that you may approach these incentives or deals. Of course, you are going to have to check to make sure that you have the ability to do this. This will involve checking your expenses and make sure that it is cost beneficial to you. After all, if you are losing money, it doesn’t make much sense to offer such a deal or incentive. I think that you understand the point, so I am going to jump right into it.
Start off by reviewing your contract and seeing if there is anywhere that you can cut some corners. Prospective tenants will be far more likely to sign on the dotted line if they are not having to factor in a large number of additional costs into their already thin budget. For instance, if you are charging for laundry or parking space, you may want to consider not charging for those extra amenities. The amount that you are making off of these extras is minuscule when compared to the price you are charging for rent. Remember, the point is to have people living in the units. If you feel that they are being deterred by you charging for parking or laundry room access, it is an obvious cut.
Another place that you can cut is application fees. Depending on how much it costs to actually conduct the background and credit check in your area, you could easily leave this out. If you are not comfortable with that, you may consider returning the fee on a successful background and credit check. This will eliminate the number of checks you have to do. Meaning, if you say in your advert that you are not charging for the checks, people will assume that you are not too serious about doing the checks. If you word it in such a way that you are returning the money upon successful completion, they will know that you are taking the checks seriously. That means that you will only have to process the applications of people that are confident they will pass the check. Otherwise, you could be spending a lot of money on checks that never had a chance.
Any place that is offering a discounted rate is very attractive to potential tenants. I am pretty sure that when you see anything on sale, you do a double-take and ponder it a little closer.
Take a look at your expenses and consider the rates offered by your competitors. Compare the cost of taking that small hit on monthly rent compared to having a unit vacant for an extended period of time. Clearly, it would be better to take a hit on the rent than to not have someone living in the unit.
You could offer discounts that convenience you as well. For example, you could offer to discount the price of rent for any tenant that is willing to pay you with automatic payments. This benefit is two-fold. Number one, you will not have to go knocking on their door each and every month asking for rent. Second, you will not have to make trips to the bank to cash the checks. This saves you a lot of time and gives them a sense that they are actually saving money. While they may be saving money, it is saving you money that you should factor into the price of your rent. Remember, the time you spend doing things for the tenant should be accounted for.
Everyone knows that the standard rental lease is one year. Perhaps you could consider altering your lease periods. While people that would opt for a shorter lease time will not have the benefit of a reduced rate, it will allow them to get out of a place faster if they are not happy with the living arrangements. On the other hand, you could offer a discounted rate to tenants that sign a longer lease. This is beneficial to you in the long run. We all know that the hardest part about owning an apartment block is getting new tenants in the unit after the other one leaves. If you are not having to dedicate your time to finding a new tenant, this benefits you as well. Consider offering a discounted rate for leases that go beyond the standard one year. For example, you could offer a 5% discount on leases that are between two and five years. You would spend far more than that amount of money just trying to advertise for your place and running the normal checks.
It may seem trivial, but the impact of the landlord taking time out of their day to bring something to a tenant can speak volumes to them. They will know that you are happy that they have chosen to stay in your unit. This should be something to consider when they first move in and on a special holiday. I like to bring my tenants a Christmas gift basket every year. It doesn’t matter much if they don’t celebrate Christmas. Just make sure that anything that you bring to them is somewhat neutral. The point is that you need to show you care for them as a tenant. You are not trying to offend anyone.
As you can see, there are many things that you can do to make your units more attractive to your prospective tenants. The last one they will not be able to see until they actually rent the place. However, it will be a nice touch. It may even encourage them to sign an extended lease in the future. I hope that this has been helpful to you. If you have any suggestions on other ways that you can entice your clients, do not hesitate to comment.