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Updated almost 10 years ago on . Most recent reply

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71
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Kenneth Davis
  • Real Estate Investor
  • Glen Saint Mary, FL
9
Votes |
71
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Any ideas on offering discounts to attract better tenants and are there any limits to types of discounts?

Kenneth Davis
  • Real Estate Investor
  • Glen Saint Mary, FL
Posted

Is it illegal to offer discounts of say, like a $25.00 discount for people who have good credit, discount for having held the same job with the same employer for over a year, a discount for not having any criminal record, discount for being a non-smoker, having a positive non-family related rental history and maybe a commuters discount? I have property which I am just totally bewildered with! My offering of a really cheap rent only attracts those largely on disability who cant afford much more than the average cost of a weeks motel stay. My idea is to advertise it for say $575.00, but then to attract more applicants and perhaps higher quality type renters offer advertised discounts for having those good qualities that all landlords generally seek. If I recieve no feedback that appears negative my plan is to offer a Commuter discount, employment discount, good credit discount, rental history discount and maybe any others I think of which would result back to a highly competitive rent of $375 and $475 which I would hope gets me some long term tenants  like those that I have in neighboring cities with much larger populations. My adverising will be kinda "guerilla tactic to attract the most attention by use of a mobile Bill Board towed on the back of a small boat trailer which I can park for short hourly intervals a few times a week at various street corners in the geographic area of the rental. It is a quadraplex and so if I got a full occupancy then all the effort will have ben worth the gamble.

Most Popular Reply

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Marcia Maynard
  • Investor
  • Vancouver, WA
4,335
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3,601
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Marcia Maynard
  • Investor
  • Vancouver, WA
Replied

@Kenneth Davis I feel your pain. Our market niche is low-income and fixed-income folks and our properties are B properties that were C when we bought them. We strive to provide affordable housing to responsible renters and we post our rental criteria, yet when we advertise at low rates, we get a lot of responses from applicants who won't qualify.

I find your idea intriguing. Reminds me of the "good driver" and "multi-policy" discounts given by the insurance companies.

The difficulty I see is how well the screening tools you use will give you a definitive answer about the applicant's background and status. What happens when that status changes? With rent subject to change... what if you start the "non-smoker" out at a lower rent rate and they turn out to be a "smoker" or take up smoking later? Or the person whose been with the same employer for many years when they began renting and then changes jobs or changes careers later?  If circumstances change and/or as you discover information contrary to what you discovered during applicant screening, what would you do? Rewrite your lease/rental agreement or use an addendum to keep the rent rate current with a tenant's situation which may change over time?

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