Apartment Concessions Get a Makeover

Multifamily rent concessions used to be simple: Throw in one month free, maybe waive an application fee and wait for the prospects to start rolling in.

At a national level, the strategy’s importance continues to expand. In June 2026, 39.7 percent of apartment listings on Zillow offered some kind of concession, up from 35.2 percent in June 2025.
The practice varies widely by local conditions. Concessions are more likely where there’s the most new product. In Charlotte, 67.1 percent of new listings came with concession offers, up 6 percent from a year ago. Close behind were Denver (65.9%) and Dallas (64.6%), Zillow reported.

Conversely, markets with strong rent growth were far less likely to rely on concessions. Only 24.9 percent of San Francisco listings included concessions in June on the strength of an 8.2 percent year-over-year jump in average rent.

The current economic situation further intensifies the demand for discounts as many renters struggle to make ends meet. By 2024, 22.7 million renter households were classified as rent-burdened because they spent more than 30 percent of their income on rent and utilities, according to the most recent report from Harvard’s Joint Center for Housing Studies.

“Concessions are still very much financial, and they really are necessary under certain marketing conditions,” noted Dustin Lovingood, senior vice president of property marketing at RPM Living. “But operators are layering in more strategic thinking around data and resident insights.”

Concessions are here to stay

Concessions reduce net effective rent without cutting advertised rent. However, when communities begin offering several months of free rent, it raises the question of whether the gross rent is realistic, according to Jon Tullo, executive vice president of client services at Apartment Management Consultants.

“Programs that feel genuinely meaningful to a resident, not just transactional, tend to create real differentiation in a crowded concession environment.”

—Dustin Lovingood, Senior Vice President of Property Marketing, RPM Living

“There’s an important distinction between using concessions as a short-term tool to address a specific leasing need versus allowing them to become a substitute for recognizing a change in market conditions,” he said.

New directions

Intentional, data-driven incentives provide fresh alternatives to conventional blanket discounts. Leveraging resident behavior, market analytics and personalization develops strategies that attract desirable renters, improve retention and protect long-term revenue.

“Now we’re starting to see more of a science behind (concessions),” said Andrea Taylor, founder & CEO of multifamily AI firm Livsee, who previously worked in operational strategy roles at Waterton and Morgan Properties.

Incentives that have proven to be effective in recent years include waived application fees and look-and-lease specials, where renters only get the deal if they sign a lease within a certain window of touring the property. For some especially competitive communities, Taylor has even seen leasing teams offer a free iPad—in addition to three months of free rent—if a prospect signs a lease.

Strategic marketing campaigns and partnerships can also break through the noise and move the conversation beyond short-term concessions designed to fill units temporarily. Once a resident has signed a lease, it’s necessary to follow up by continuously providing value.

“Programs that feel genuinely meaningful to a resident, not just transactional, tend to create real differentiation in a crowded concession environment,” Lovingood noted.

His firm partners with Bilt to offer residents points for paying their rent on time. Rewards can be redeemed for travel and other perks, including a downpayment on a home. RPM also sponsors Free Rent Unlocked, which invites residents to enter for a chance to win a year of free rent. These experiential programs demonstrate that resident engagement can continue to drive the business beyond a first-time lease.

RPM has seen a strong reaction to these initiatives. In 2025, Free Rent Unlocked led to 34 percent more prospects per property and 16 percent more leases per property compared to communities that did not participate in the program.

For the 2026 free rent contest—which is ongoing— even higher engagement is expected. During the first week alone, the campaign attracted more than 20,000 sweepstakes entries. Additionally, the introduction of a social media campaign led to a 260 percent increase in website views that week.

“What these results reinforce is … concessions are still very much about driving lease signings, but when you can also build in a retention and reward component, the payoff compounds over time,” Lovingood pointed out.

“Like all things real estate, concession strategy is, and will remain, a hyper-local conversation.”

—Jon Tullo, Executive Vice President of Client Services, Apartment Management Consultants

Where concessions go next

Concessions are moving toward a more intentional future. As more communities feel the pressure to compete, finding new ways to bring in—and retain—residents will be crucial to success.

After a lease is signed, management can encourage the resident to renew by being intentional with amenities, loyalty programs and engagement offerings. That tends to reduce turnover and limit the number of new leases that require an upfront concession.

In concession strategy, there can be a link between a property’s reputation for quality and a limited need for concessions, or a call for more innovative incentives when comparable properties are offering conventional concessions. The issue is especially relevant at a time when new Class A communities and other properties offer similar amenities.

“The question is: Do renters appreciate this? Do they want this? Will they stay here because of it?” observed Taylor. “And that’s more of a colloquial datapoint than something you can figure out on a spreadsheet.”

And it’s just as important to keep an eye on the performance of the immediate area as on the latest national trends. What works in the Sun Belt may not work in the Bay Area. As Tullo put it: “Like all things real estate, concession strategy is, and will remain, a hyper-local conversation.”

Read the August 2026 issue of MHN.