What is a Rent Concession? A Guide to Attract & Retain Tenants (2025)

What is a rent concession? It’s the landlord’s version of a handshake deal sweetener, only much more strategic. In 2025, with renters shopping around harder than ever, concessions can be the hook that turns browsers into long-term tenants. Let’s look at what they are, why they work, and how to offer them smartly!

Quick Takeaway

What Is a Rent Concession?

Rent concession is a deal or special offer landlords give to a tenant to make renting the property more appealing. Instead of lowering the monthly rent permanently, the landlord might offer one month free, waive the security deposit, or give a discount on move-in costs.

Some landlords consider it a way to attract renters without slashing their regular price for good. This is really helpful in a competitive market like 2025, where renters have lots of choices. A concession helps your listing stand out and gives people a reason to choose your property over someone else’s.

Rent concessions are common in both residential and commercial leasing. They are a smart business move to fill vacancies faster, keep tenants longer, and maintain steady rental income.

Key Benefits of Offering Rent Concessions

So, why should you offer a rental concession at all? Isn’t that just losing money? In reality, concessions can help you make more money in the long run by reducing costly vacancies and turnover.

Filling Vacancies Faster

Vacant units cost you money every day they sit empty. You still have to pay the mortgage, property taxes, insurance, and maintenance, even with no rent coming in. This is true in rent-controlled or rent-stabilized markets, where raising rent isn’t an option to offset vacancies quickly.

A rental concession gives renters an extra reason to say yes quickly. For example, offering half-off the first month’s rent or free parking can make your property stand out in their search. It’s often cheaper to offer a small discount now than to let the unit sit vacant for weeks or months. 

Reducing Tenant Turnover

Tenant turnover can be expensive. Every time someone moves out, you have to clean, repair, advertise, and screen new tenants. Plus, you lose rental income during the vacancy period.

Rent concessions can help keep good tenants around longer. You offer a discount or bonus if they renew their lease for another year. By making tenants feel like they’re getting a good deal, you build loyalty. They’re less likely to leave for another property with a better offer.

Stabilize Cash Flow

Additionally, rent concessions help you fill units quickly and keep tenants in place. Offering a rent concession, like giving a small discount or a free month at move-in, is often better than having no rent for months. While it’s a one-time cost, filling the unit quickly means you'll get steady rent for the rest of the lease. 

This approach helps reduce vacancy and ensures you have regular cash flow.. It also helps you predict and manage your cash flow more easily.

Building Long-Term Tenant Relationships

Offering a rent concession is also about starting the landlord-tenant relationship on the right foot.

When tenants feel like they got a fair deal or a special perk, they’re more likely to see you as a reasonable and caring landlord. This can lead to better communication, on-time rent payments, and tenants who take better care of your property. Happy tenants often stay longer and refer friends or family to your other rentals.

Looking for ways to collect rent more efficiently? Check out our guide on 10 ways to collect rent for busy landlords.

7 Types of Rent Concessions Landlords Can Offer

Rent concessions are flexible tools landlords can use to solve different problems. Look at our popular and effective rent concession examples you can offer to make your property stand out:

1. Free Rent
2. Rent Reductions
3. Fee Waivers (Application, Admin, Pet Fees)
4. Broker Fee or Moving Cost Assistance
5. Security Deposit Reductions or Waivers
6. Free Amenity Access
7. Property Upgrades

Free Rent

Free rent is one of the most attractive offers for tenants. Landlords often advertise one month free or two weeks free to get attention.

Offering free rent for a set period works well to encourage quick move-ins. Tenants see it as immediate savings they can use for moving expenses or other bills. For landlords, this short-term giveaway can mean getting the lease signed sooner, avoiding long vacancies, and securing income for the rest of the lease.

You can structure free rent in many ways:

• One month is free upfront
• Half off the first two months
• A free final month at lease-end

The key is making the terms clear in the concession lease so tenants understand exactly what they’re getting.

Rent Reductions

A rent reduction is a simpler, more predictable form of concession that lowers the monthly rent for a specific period.

Instead of giving one big free month, you might reduce rent by $100 for the first six months. Tenants like this because it smooths their budget over time instead of giving them a single large discount.

This strategy can work well to compete on monthly concession rent price without committing to permanent discounts. Once the initial reduced term ends, the rent can return to the standard rate you want long-term.

Fee Waivers (Application, Admin, Pet Fees)

Renters often get sticker shock when they see all the extra costs beyond monthly rent. Application fees, administrative fees, and pet fees can add up quickly. Waiving these fees is an easy, low-risk way to make your property feel more welcoming. It can also tip the scales in your favor when a tenant is comparing two similar listings.

Some examples are:

• No application fee
• Waived admin or move-in fees
• No pet fee (or reduced pet deposit)

Broker Fee or Moving Cost Assistance

Moving is expensive, particularly in cities where broker fees can be thousands of dollars. Covering the broker’s fee is a major incentive and immediately removes one of the biggest barriers to signing a lease.

Beyond broker fees, you can also offer moving cost assistance, such as:

• A credit toward a moving truck rental
• Payment for professional movers
• A flat move-in bonus to help with expenses

These offers show tenants you understand the stress of moving and are willing to help them get settled. It builds goodwill immediately and makes your property stand out as the easier choice.

Security Deposit Reductions or Waivers

For many renters, the security deposit is the single largest upfront hurdle. Coming up with a full month (or more) of rent for a deposit can stop a qualified tenant from signing.

Offering reduced deposits or structured alternatives can be a strong concession without sacrificing your protection against damage or unpaid rent. Some other landlords might:

• Cut the deposit in half
• Allow installment payments over several months
• Use deposit insurance services that cover damage claims

This approach can attract tenants who can afford rent comfortably but don’t have a big lump sum ready at move-in.

Free Amenity Access

Amenities add real value to a property, but many landlords charge extra for them. You can try to offer them free amenity access as a concession. We recommend these ideas:

• Free parking spot
• Free gym or pool access
• Included high-speed internet
• Free storage unit

These amenities already exist at your property, so the cost of adding an extra user is often minimal. 

Property Upgrades

Rather than opting for a rent discount, consider investing in the unit itself. This approach might include a variety of improvements and upgrades that not only elevate your personal comfort but also increase the overall value of the property. This might include:

• New appliances
• Fresh paint or flooring
• Modern lighting fixtures
• Improved outdoor areas or landscaping

These upgrades make your rental more appealing immediately and raise its long-term value. Tenants feel like they’re getting a personalized, higher-quality home, and you benefit from being able to justify strong market rents in the future.

Property upgrades also send the message that you care about providing a good living experience. 

Rent Concessions and Insurance Considerations

Next, it’s important to think about how these tenant concessions fit into your risk management plan and your insurance coverage.

How Concessions Can Impact Landlord Liability

Rent concessions often involve modifying lease terms, which can create new obligations or raise questions later.

• Free amenity access means you must maintain those amenities safely. If a tenant gets injured in a free gym, liability remains with you.
• Reduced or waived security deposits can make it harder to recover unpaid rent or damage costs.
• Free-rent periods need to be clearly documented to avoid disputes about when payments begin or end.

Remember to put every concession in writing in the concession lease. This protects you legally, clarifies expectations, and prevents misunderstandings down the road.

Policy Add-Ons for Risk Management

Standard landlord insurance covers property damage, liability for injuries, and sometimes lost rent due to damage or disasters. But concessions can change your risk profile in ways your existing policy may not cover well.

• Waived deposits can increase the risk of losses from tenant damage or unpaid rent.
• Increased amenity use can raise liability risks.

To manage these risks, many landlords look into extra insurance options:

• Rent loss insurance (covers rent if damage makes a unit uninhabitable)
• Deposit guarantee or insurance products (replace traditional deposits with coverage for damage or unpaid rent)
• Umbrella liability policies (provide broader liability coverage for injury claims)

Tip: Discuss your concession strategy with your insurance agent to see what makes sense for your situation. A well-designed policy gives you the freedom to offer attractive tenant concessions while staying protected from the financial surprises they might bring.

When Is the Best Time for Landlords to Offer Rent Concessions?

Timing is everything. Doing it at the right moment helps you get the most value from the incentive while keeping your cash flow healthy.

Generally, the best time to use rent concessions is when demand slows or competition heats up.

• Off-Season Leasing: Many markets see lower demand in winter. A month free or reduced fees in January can keep you from sitting vacant until spring.
• High Competition Periods: When several nearby buildings have new units available, a well-placed concession helps you stand out without permanently dropping your rent.
• New Property Lease-Up: Brand-new or renovated properties often need to fill many units quickly. Concessions draw in tenants early, building occupancy momentum.
• High Vacancy Spikes: A sudden vacancy wave in your area can make renters picky. Offering something extra can help you lease your unit first.
• Tenant Renewal Time: A small rent discount or free amenity for renewal concession can keep a reliable tenant who might be tempted to move elsewhere.

Timing your concessions smartly helps you avoid long-term rent reductions while still solving short-term challenges.

Tips to Maximize Return on Investment Using Rent Concessions

Now we come to the most important part! How to maximize return on investment (ROI) when using rent concessions?

Create Tiered Incentive Packages

Not all tenants are motivated by the same rent concession deal. Some care about upfront costs, others about monthly savings or amenities.

Creating tiered incentive packages allows you to tailor concessions to different tenant needs. You can look at these examples:

• Package A: One month free for quick move-in
• Package B: $50/month discount for the first year
• Package C: Free parking and waived pet fees

Tiered options give you flexibility. You can use them to negotiate without seeming rigid, and you control what you’re willing to offer in each scenario. It’s a way to add perceived value without sacrificing your bottom line.

Screen Tenants Thoroughly

Offering concessions shouldn’t mean lowering your standards. In fact, screening becomes even more important when you’re giving upfront value.

Tenants drawn by discounts might have weaker financial profiles. Protect yourself by:

• Verifying income by requesting an income letter from tenants
• Running credit checks
• Contacting previous landlords

It’s better to wait for the right renter than to fill quickly with someone who stops paying after the concession period ends.

Track Performance & Cash Flow Impact

Concessions are business decisions. You should treat them that way by measuring their impact. Track key metrics such as:

• Vacancy rates before and after offering concessions
• Lease-up speed
• Retention rates
• Total rent collected over time

Analyze if the cost of the concession pays off in reduced vacancy loss or lower turnover expenses. A well-run property is always data-driven.

Use Budget‑Based ROI Calculators

It’s easy to feel generous, offering a big discount at the moment. But smart landlords model the financial impact first.

Use ROI calculators or simple budget spreadsheets to see:

• How much vacancy loss you can avoid with the concession
• Total cost of the concession over the lease term
• Effect on annual cash flow

This lets you choose the most cost-effective incentives. It also helps you justify your offers to partners or investors who want to see the math behind your strategy.

Operational Strategies to Balance Risk

Rent concessions help you stay competitive, but they also create new challenges. Reduced upfront cash from deposits, higher tenant turnover risk, and liability for promised perks mean landlords need smart operational strategies to manage risk.

Screen Tenants Carefully

Good tenant screening is the foundation of risk management. When offering concessions, you’re often lowering financial barriers to entry (like deposits or fees). Make sure you:

• Check credit and rental history
• Verify income and employment
• Look for red flags like eviction records

By being selective, you reduce the risk of damage, unpaid rent, or costly evictions. Concessions should bring in more qualified tenants.

Offer Tiered Concessions

One way to manage risk is to tailor concessions to match tenant quality and market demand. Instead of giving everyone the same deal, create tiers or conditions.

• Offering better incentives for longer lease terms (like 18–24 months)
• Giving discounts for immediate move-ins to avoid vacancy gaps
• Reserving big concessions for peak competition periods

Tiered concessions let you maximize marketing impact without handing out more discounts than necessary. It keeps costs under control.

Conduct Regular Inspections

Concessions can attract more tenants quickly, but you want to ensure those tenants take care of your property.

Regular inspections help you:

• Identify maintenance issues early
• Ensure lease compliance (pets, occupancy limits)
• Maintain good communication with tenants

Tenants who know the landlord pays attention are more likely to respect the property. Inspections are also a chance to reinforce expectations and build positive relationships.

Conclusion

So that’s the big picture on what a rent concession is and how to make it work for you. When used strategically, rent concessions are deliberate tools to improve occupancy, retain great tenants, and optimize cash flow. For more in-depth articles on leasing best practices, tenant screening, and property management, visit our LeaseRunner blog!

FAQs

Q1. What is a move-in concession?

A move-in concession is an incentive landlords offer to encourage tenants to sign a lease quickly. It’s usually something that reduces the tenant’s upfront move-in costs or sweetens the deal in a way that feels immediate and valuable.

You can check these common move-in concessions:

• One month of free rent
• Waived application or admin fees
• Reduced security deposit
• Free parking for the lease term

The goal is to make your rental more appealing compared to others on the market. 

Q2. What is a concession fee for an apartment?

A concession fee can be a confusing term because it’s used in different ways by landlords and property managers. Generally, it refers to the value of the discount or incentive offered to the tenant. Essentially, the cost of the concession to you as the landlord.

• If you offer one month free on a 12-month lease at $1,500/month, the concession fee is $1,500.
• It might also appear as a line item on accounting statements to track how much revenue you discounted to secure the lease.

In some lease documents, it’s explicitly noted so both landlord and tenant understand the deal. It’s important to be clear about any concession fees or discounts in the lease itself to avoid disputes later.