Should you Offer a Deal to Find New Tenants for Greensboro, NC Rental Property

Finding great tenants for their rental property is one of every landlord’s greatest challenges. For landlords in Greensboro’s ruthless rental market, the obstacles are even greater.

Tightening competition among property investors due to the increasing number of rental properties and higher expectations from renters means that landlords often struggle to find suitable tenants for their properties.

Coupled with growing household budget instability, these conditions compel many Greensboro landlords to explore unorthodox strategies when trying to fill vacancies in their rental properties.

Some landlords may think of offering incentives to attract new tenants to their property. The truth is, incentives can help your property stand out in a crowded market, but they also come with potential drawbacks.

This post takes a closer look at the issue. We discuss why offering a rental incentive to new tenants may be a good step. But we also zoom out to look at the long-term impact of this strategy on the performance of your rental property.

This article, by TRI Property Pros provides you with the details to make an informed decision on whether to offer a deal to new tenants or not.

Why do Greensboro Landlords Offer Rental Incentives?

Over the past few years, sustained economic upheavals and changing supply & demand dynamics have seriously altered the structure of the rental market, forcing many landlords to explore unconventional solutions as a way to ensure the survival of their investments.

Some of these factors include:

• Rising inflation and higher living expenses. As a result, prospective tenants are more careful about how they spend their money, leading them to be more demanding.
• Recent influxes of property investors trying to take advantage of Greensboro’s relatively low entry point for rental properties have increased competition across neighborhoods.
• The growing inventory of modern and attractive rental properties means that tenants are more likely to look beyond the rent when comparing rental properties.
• Even as more people settle in Greensboro because of its affordability, growing economy, and excellent quality of life, renters still have more choices than ever.

For landlords, these factors create a new and evolving challenge. How can they make their property more attractive than rival properties without lowering their rental rate?

The most accessible option for many landlords is offering incentives to new tenants. Such limited-time benefits can motivate potential renters to sign up sooner.

Common Rental Incentives Offered by Greensboro Landlords

The best rental incentives are those that make a rental property more attractive without forcing landlords to give money away. Here are the most common ones used by landlords in Greensboro:

Rent-Free Periods

This usually comes in the form of one or two rent-free months either at the beginning or end of the tenancy.

Move-In Assistance

Some landlords offer to refund the cost of hiring a moving company or provide some credit to cover this expense.

Waived/Reduced Fees

To help reduce the tenant’s upfront costs, landlords can waive or reduce some fees or even the security deposit.

Inclusive Utilities

Since utilities form a major part of a tenant’s costs, making them a part of the base rent can make a rental more attractive.

Complimentary Parking & Storage

Dedicated parking and sufficient storage are two things most rentals lack. Landlords often offer them as incentives.

Upgraded Finishes/Amenities

To attract/keep quality tenants, a landlord may offer to install features that most renters would love in their home.

Lease Renewal Bonuses

Perks like cash bonuses, a rent-free month, or complimentary apartment cleaning help landlords retain long-term tenants.

Pre-Move-In Apartment Cleaning

To help the tenant minimize the hassle and cost of moving in, the landlord may offer free professional apartment cleaning.

Flexible Move-In Dates

For prospective tenants with time/distance constraints, the landlord can let them choose the most convenient move-in date.

Incentives help prospective tenants feel that they are getting more value for their money while also allowing the landlord to maintain the advertised rental price.

Benefits of Rental Incentives

Shorter Vacancy Periods

The cost of offering these incentives is often far lower than the financial loss of leaving the rental unit vacant. Every month a rental property sits vacant, the landlord must cover its running costs (mortgage payments, taxes, insurance) out of pocket.

Attract Better Tenants

When offering incentives, landlords typically target the best renters in the market. Incentives help landlords market their property to a larger pool of qualified renters. Furthermore, when properly used, incentives help to boost the perceived value of a rental in tenants' eyes.

Maintain Your Market Rent

By offering rental incentives, landlords do not have to lower the rent as their only strategy to attract tenants. Rental incentives offer a way to provide temporary value without reducing the long-term profitability of a rental.

Encourage Longer Lease Terms

By tying their offer to the lease length, landlords can use rental incentives as a way to encourage tenants to sign an 18- or 24-month lease instead of the standard one-year agreement.

Potential Downsides of Rental Incentives

Impact on Immediate Revenue

Waived/reduced fees, rent-free periods, etc. have an immediate negative impact on rental income. Before offering these incentives, it is vital to weigh the cost of the incentive against the cost of the continued vacancy.

May Attract Price-Focused Renters

Incentives sometimes attract renters who are only interested in the discounts. Thorough tenant-screening will help landlords weed out renters who plan to move as soon as another deal becomes available elsewhere.

Create Wrong Expectations

When landlords offer discounts too frequently, tenants may begin to view those incentives as their right. Too many incentives offered too often can make it harder to rent the property at its full market value.

Questions to Ask Yourself

Is Your Rental Property Priced Correctly?

It makes no sense to offer incentives if the property is already priced lower than similar rental homes in the area. On the other hand, if the rental is overpriced, reducing the rent may be a better option than offering incentives.

How Long Has the Property Been Vacant?

If your property has been sitting vacant for several weeks with limited inquiries, rental incentives can help you get more attention from potential renters. But if the rental has only been listed for a few days, maybe you just need to be patient.

Finally, if you decide to offer a rental incentive, do not ignore these best practices:

• Use limited-time promotions to create urgency.
• Follow your usual screening procedures; never relax the criteria.
• If possible, make the reward contingent on lease completion.
• Ensure the terms of the offer are clearly explained in writing.

These measures help to safeguard rental profits while letting you maximize the benefits of your promotions.

Conclusion

Offering rental incentives can be a good way to find and keep new tenants but there are questions that property owners should ask themselves before doing so.

If you want to know more about rental incentives or any other property management needs contact TRI Property Pros today and let us help your Greensboro rental property thrive.