All property owners want to encourage their best tenants to stay in the home, pay their rent on time and take good care of the property while they are living there. At Cavalier Estates, we like to offer incentives to our tenants to ensure they do what we want them to do. When your tenants are motivated, you won’t have to worry about some of the problems that property owners run into when they rent out their investment homes.
Discounts, when appropriate, are a great idea. For example, if we charge a tenant $1,000 a month in rent, we will offer a $75 per month discount if the tenants pay rent ahead of the due date and they also pay attention to simple maintenance. We see this as similar to an insurance policy that you might buy to protect your property. With this incentive in place, the tenants can take care of simple things such as clogged toilets or broken furnaces. Such repairs will only cost $35 or $40, so it makes sense for everyone to ask your tenant to take care of the problem whenever possible. The people living in your home probably have their own skills and talents. It works out for everyone. You don’t have to be bothered with small maintenance requests and the tenant gets a discount. Obviously, you will need to fix any problems that the tenant cannot handle, but then you wouldn’t have to provide the discount. With our system, anything above a $75 repair will need to be taken care of by the property owner or the property manager.
We have found this incentive program is successful in getting tenants to take care of things on their own. When they do this in addition to paying their rent on time or early, their discount gives them a place to live that is below market rent. When you can afford this type of incentive, the properties will rent quickly and you will always attract good long term tenants.
We also offer discounts when tenants renew leases. At the beginning of the second year, if a tenant renews their lease, they get a 10 percent discount off their 13th month. Once they have been with us for two full years, they get a 25 percent discount on the 26th month. When our best tenants stay with us for three years and they never miss a rent payment and they take care of their own maintenance, we give them the 37th month for free when they sign a lease for their fourth year. That’s a whole month without a rental payment.
Tenants don’t always live up to the standards we set. There are great tenants, however, and when we have one, we find incentives and discounts to be a good way to keep them. Evaluate each tenant individually and decide who gets the incentives based on how well they perform as tenants. This is a great way to be competitive in the rental market. Tenants will want to live in your properties and pay their rent on time.
We’d be happy to tell you more about our incentive programs. If you have any questions, please contact us at Cavalier Estates.