How to Use Rental Incentives Effectively
- Aug 22, 2019
- 7 min read
Updated: Jun 7
How Incentives Help Landlords Attract & Keep Tenants
Incentives are everywhere—used across industries to drive sales and attract loyal customers. From “Buy one, get one free” to “Claim your bonus gift,” these offers motivate action—and you've probably taken advantage of a few yourself.
Yet when it comes to rental real estate, many landlords aren’t sure how to use rental incentives effectively. Aside from the occasional move-in special from large apartment complexes, these powerful tools are often ignored or misunderstood.
The truth? When used strategically, incentives can attract quality tenants, reduce vacancies, boost lease renewals, and improve your cash flow. Want to learn how small perks can lead to big results? Let’s dive in.
Observations & Statistics
Observation 1: Most Tenants Move for Lifestyle Reasons
It may surprise some landlords, but most renters don’t leave because of high rent. In fact, studies show fewer than 6% of tenants move out due to cost. Instead, tenants are far more likely to relocate for lifestyle reasons—such as starting a new job, getting transferred, reducing their commute, buying a home, or needing more space.
Key Takeaway: Raising rent isn't usually the deal-breaker. Focus instead on offering a great experience and thoughtful incentives that help tenants stay—even when life circumstances change.
Observation 2: Rent Discounts Are the Top Incentive
When it comes to monetary incentives, rent discounts lead the pack. Surveys show that 58% of renters prefer a rent reduction over other perks. Cash bonuses rank second at 28%, followed by security deposit rebates (10%) and gift cards (4%).
But demographics matter: older renters favor long-term value, such as property upgrades and well-maintained homes, over quick financial perks. That’s why tailoring your incentive strategy to your target audience is key.
Key Takeaway: Offering a rent discount may win over younger renters fast—but for long-term tenants, upgrade incentives like new appliances might make a bigger impact.
Pro-Tip: Curious about how rent discounts impact occupancy rates? Explore Rentec Direct's insights on how landlords are leveraging rent-based incentives to boost tenant retention and reduce vacancies.
"With 63% of renters owning pets, many will only consider pet-friendly rentals."
Observation 3: Lifestyle Perks Can Boost Renewals
Not all tenant incentives need to involve rent or renovations. Lifestyle perks—like gym memberships, grocery delivery subscriptions, or covered parking—rank high among non-monetary motivators. In fact, 47% of renters say they'd be more likely to renew if given a gym membership.
These non-cash perks are especially effective when traditional upgrades aren't an option. They show tenants you care about their convenience and quality of life.
Key Takeaway: Offering wellness-related or convenience perks can boost lease renewals and help you stand out—even if your property lacks luxury amenities.
Observation 4: Unit Upgrades Are a Mixed Bag
Only 27% of renters say they'd renew a lease for upgrades like flooring, lighting, or paint. Renters value improvements that offer clear, daily benefits—like kitchen appliances, new carpet, or a washer/dryer. Fresh paint, though common, ranks lowest in appeal.
Key Takeaway: Focus on functional, high-impact upgrades over cosmetic ones to better sway lease renewals.
Observation 5: Tech Incentives Appeal to Many Renters
Electronics like TVs and tablets are attractive incentives—especially to male renters, who favor TVs more than women. Additionally, 11% would choose free transportation, while 13% prefer a one-time gift like event tickets over ongoing perks.
Key Takeaway: Tech gadgets and unique one-time rewards can be effective tenant incentives—especially when tailored by demographic interests like age or gender. Just be sure your offerings comply with Fair Housing regulations to avoid unintentional discrimination when customizing perks.
Observation 6: Pet Policies Strongly Influence Tenants
With 63% of renters owning pets, many will only consider pet-friendly rentals. Offering pet-friendly amenities can give your unit an edge—10% of renters say they’d renew a lease if allowed to have a pet.
Pro-Tip: Want to learn why pet-friendly rentals attract more tenants? Check out NAA’s guide on pet-friendly rentals to discover insights and opportunities.
Using Incentives to Increase Rental Cash Flow
Offering incentives isn’t just about attracting renters—it’s about increasing your property’s income potential. The key is choosing incentives that align with what tenants truly value. Many of the most sought-after renter amenities can justify higher rent and reduce turnover.
Private Outdoor Space: Balconies, patios, or porches are a major draw. Half of renters are willing to pay more for a place to relax outside—even a small one.
In Unit Washer & Dryer: Three out of five renters are willing to pay more for in-unit laundry—especially Millennials. Bonus: 15% of residents on the fence about moving say a new appliance would convince them to stay.
Central Air Conditioning: Another amenity that 3 in 5 residents would pay higher rent to have, across every generation. If central air isn’t feasible, provide well-maintained window units or ceiling fans to enhance comfort and appeal.
Dishwasher: Over 40% of renters say they’d pay a premium for a unit with a dishwasher. It’s one of the simplest ways to boost perceived value, especially in single-family home rentals.
Extra Storage Space: As renters age and accumulate more belongings, added storage becomes a top priority. Even off-site or shared closet space can command higher rents. Keep in mind that 1 in 4 respondents would pay higher rents for storage space located elsewhere onsite.
Garage Parking: In cold-weather markets like Michigan, garage access can be a huge differentiator. Renters value protection from the elements and added convenience.
Pro-Tip: Looking for the most in-demand amenities? This Zillow consumer report reveals what renters value most—and what they’re willing to pay more for.
Using Incentives to Beat the Competition
Small landlords often feel they can't compete with larger apartment complexes that offer gyms, pools, or concierge perks. But with the right strategy, you can outshine the "big guys" by offering targeted incentives that directly address your applicant’s concerns—something corporate properties often can’t do.
Address Location Concerns with Practical Perks
If your rental is farther from town or major job hubs, you may hear feedback like “It’s too far.” Instead of dropping the price, try offering a pre-loaded gas card. This small incentive can flip a perceived drawback into a benefit, especially if the property itself is otherwise ideal.
Offer Amenities They Can’t Get Next Door
Younger renters used to apartment gyms? Match that value with a free gym membership for 6 or 12 months. Not only is it less expensive than weeks of vacancy, but it adds perceived value that private rentals often lack—and shows you’re responsive to their lifestyle needs.
Trade Upgrades for Tenant Performance
If your unit needs updating but you’d rather not lose rental income during a renovation, try an upgrade incentive program. Offer improvements—like new appliances, lighting, or bathroom fixtures—as rewards for on-time or electronic rent payments. Tenants get a better living space, and you improve your property while maintaining cash flow.
Key Takeaway: You don’t need a fitness center or rooftop lounge to compete—just smart, meaningful incentives. Use them to offset drawbacks, personalize offers, and retain quality tenants while improving your bottom line.
Smart Timing and Limits for Rental Incentives
Rolling out rental incentives? Smart move—but timing and limits matter. Use incentives strategically, not automatically. If your unit already has strong demand, you likely don’t need to sweeten the deal.
Set Conditions for Incentive Eligibility
Always tie incentives to tenant actions. For example, offer a free month’s rent spread over 12 months, applied only when payments are made on time. Or offer unit upgrades as rewards for switching to electronic payments. This not only improves your operations—it protects your bottom line.
Time It Right
Match your incentives to the season. Free lake access means more in summer. Free heating appeals in winter. Keep incentives flexible, and use them as powerful tools during lease renewals or slow leasing seasons.
Pro-Tip: For more insights on strategic incentive timing, check out this comprehensive guide by Bay Property Management Group: Benefits of Offering Incentives for On-Time Rent Payments.
Stay Within Your Budget
The average turnover costs landlords about $650 in cleaning, vacancy, and marketing. If a $300 incentive helps fill a vacancy faster or keeps a reliable tenant, it’s worth it. The key? Set a clear dollar limit based on your vacancy risk. Skip extravagant offers like $2,000 TVs. Choose incentives with real ROI.
Key Takeaway: Use incentives only when needed, pair them with tenant requirements, and keep them cost-effective. Done right, they’ll boost retention, streamline operations, and maximize profitability.
Final Thoughts on Using Incentives
At this point, you’ve seen just how versatile and powerful knowing how to use rental incentives strategically can be—from rent discounts and upgrades to lifestyle perks and pet policies. When used strategically, incentives don’t just attract great tenants—they reduce vacancy, boost retention, and strengthen your bottom line.
To make the most of them, ensure your incentives:
Solve a known pain point in your rental listing
Align with your ideal tenant’s needs and lifestyle
Offer clear value—without cutting into profits
Help streamline management and operations
Well-crafted incentives can be your rental’s secret edge, turning an ordinary listing into the clear winner. So whether it’s a small perk or a big benefit, be thoughtful, be targeted—and watch your tenant satisfaction (and ROI) grow.
Related: Build Wealth Through Real Estate
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About the Author Ricardo Reis - Learn About Ricardo
Entrepreneur, Inventor, Investor, Military Veteran. Ricardo is a member of G3 Management & Investments a division of Great Lakes Real Estate and a real estate professional. He is a real estate professional and a successful real estate investor for over 15 years.
NOT INVESTMENT, FINANCIAL, LEGAL, TAX, OR OTHER ADVICE: This blog is for informational purposes only and not a substitute for professional advice. We do not offer advice, solicitation, recommendations, or endorsements. You are solely responsible for evaluating the information's merits and risks. Always consult a qualified professional before acting.
