Rent Concessions – Should you offer them?

Key Takeaways:

  • Rent concessions can be an effective strategy for attracting tenants, filling vacancies, and retaining existing tenants.
  • Offering temporary rent reductions, rent abatement, and incentive services are different types of rent concessions to consider.
  • It is important to carefully evaluate market conditions, property specifics, and tenant qualifications when deciding to offer rent concessions.

Considering the Reference Data provided, let’s dive into the topic of rent concessions. In this section, we will provide an overview of rent concessions, exploring what they entail and how they can impact both landlords and tenants. Additionally, we will define rent concessions to ensure clarity on the concept. Through this exploration, we aim to shed light on whether or not offering rent concessions is a viable option for landlords and if tenants should consider them.

Overview of Rent Concessions

Rent concessions are a great help to landlords. They attract tenants, fill vacancies and improve tenant satisfaction. Incentives like rent reductions, rent abatement or services could be offered. Property owners can use these to react to market conditions and compete in the rental market.

For example, landlords can offer financial incentives through rent concessions. This could be temporary reductions or even free rent for a certain period. This attracts potential tenants and helps landlords fill vacancies faster. It also shows existing tenants that the landlord is dedicated to their satisfaction.

That said, landlords should think about several factors before offering rent concessions. They need to assess market conditions, review property attributes and evaluate potential tenants. Establishing clear agreements and open communication with tenants is also essential.

When deciding whether to offer rent concessions, landlords need to balance the financial losses with the benefits. They should evaluate market conditions and get professional advice if needed. This way, they can make informed decisions to benefit themselves and their tenants.

In conclusion, rent concessions are important for the rental market. But landlords should consider all factors before offering them, so they don’t suffer financially. By following this overview, they can use rent concessions to their advantage.

Definition of Rent Concessions

Rent concessions are a great way to attract and retain tenants. They can come in the form of discounts, rent reductions, or services. And they can differentiate a property in a competitive market. They can also fill vacancies quickly and incentivize tenants to stay.

But, before offering any concessions, landlords must consider market conditions, the property, and tenant qualifications. It’s also important to have agreements in writing.

However, there are potential drawbacks. Reduced rental income and tenants expecting similar deals in the future are possible. So, landlords must manage expectations and communicate changes well.

Rent concessions: a great way to make tenants feel good, while landlords might feel a bit grumpy!

What are Rent Concessions?

Rent concessions can be a game-changer in the world of real estate. In this section, we’ll uncover the essence of rent concessions, exploring what they are and why they matter. From understanding how rent concessions work to discovering real-life examples, you’ll gain valuable insights into this powerful tool used by landlords and tenants alike. So buckle up and get ready to dive into the world of rent concessions and their impact on the rental market.

Explanation of Rent Concessions

Rent concessions are special offers landlords or property owners provide to attract tenants or fill vacancies. These can be rent reductions, temporary rent reductions, rent abatements, or offering services as incentives. The goal is to give potential tenants financial benefits and make the rental environment favorable.

Rent concessions have various purposes. One is to draw in tenants who wouldn’t lease due to high rent. By offering reductions or free services, landlords can make them interested. This boosts the chances of getting leases.

Another use is to quickly fill vacancies. In competitive rental markets where supply exceeds demand, landlords can stand out from competitors with concessions and draw more applicants. This reduces vacancy periods and helps property owners get a steady income.

Retaining tenants is another role rent concessions play. By giving incentives like reduced rent for a longer period, landlords can motivate existing tenants to renew leases. This not only ensures occupancy but also strengthens relationships with tenants.

Temporary rent reductions are commonly used. Landlords may give discounted rates for a period, so tenants can save money when starting a business or during hard times.

Rent abatements are another type of concession. Here, landlords forgive part or all of the rent payment for a period. This is often used as compensation for any disruptions tenants face.

Incentive services can also be included in rent concessions. Examples are free utilities, parking spaces, or access to amenities like gyms or pools. These add value and make the renting experience better for tenants.

Though there are benefits to offering rent concessions, there are drawbacks too. Lower rental income due to reduced rents or free periods can cause financial losses. Landlords must examine the financial implications before implementing concessions to stay profitable.

Setting a precedent by offering concessions may create an expectation among tenants for future concessions or lower rents. This could make it hard for landlords to increase rental rates or maintain profit margins.

Tenants may also be disappointed if concessions are discontinued. When deciding whether to offer rent concessions, market conditions, property specifics, tenant qualifications, and preferences must be considered.

Examples of Rent Concessions

Rent concessions are agreements landlords make to give tenants benefits or incentives, like reduced rent or services. These are done to entice tenants, fill vacancies, and address market and property specifics. Examples include temporary rent reductions in response to market conditions, rent abatement due to maint. issues, and incentive services such as free parking, access to amenities, or move-in help.

However, there are drawbacks. Financial losses if it reduces rental income, and setting a precedent for future negotiations and expectations. Landlords should consider market conditions, location, amenities, and property condition when deciding whether to offer concessions. Written agreements, clear communication, and regular monitoring/evaluation are key.

Offering rent concessions can be like dating – who doesn’t love a little incentive to seal the deal?

Benefits of Offering Rent Concessions

Offering rent concessions can be a strategic move for landlords and property managers. In this section, we will explore the benefits of providing rent concessions to tenants. From attracting tenants and filling vacancies to maintaining tenant retention, these concessions can play a pivotal role in the overall success and profitability of rental properties. By understanding the advantages of offering rent concessions, you can make informed decisions that benefit both your tenants and your investment.

Attracting Tenants

Rent concessions can be a great way to draw tenants to your property. Consider offering temporary rent discounts, rent abatements or extra services. This can make your property attractive and competitive in the rental market.

  • Rent Reductions: Lower the monthly rental amount for a certain time. This can be appealing for people looking for affordable housing.
  • Rent Abatements: Give a period of free rent to new tenants. This can be useful for people or businesses starting out and needing financial assistance.
  • Incentive Services: Provide freebies like free parking, gym access or maintenance services. This can make your property stand out and create value for renters.

In addition to these strategies, stay in touch with prospective tenants and provide clear information about the property. Regularly check how your rent concession program is doing and make necessary adjustments.

Also, consider market conditions specific to your location and property type when offering rent concessions. Understand supply and demand dynamics and competitive rental pricing. This will help you determine the best concession to offer.

By creating rent concessions that meet the needs of your target market, you can increase the chance of attracting tenants and filling vacancies.

Filling Vacancies

Rent concessions can be a great way to fill vacancies. Landlords can offer favorable terms and incentives to attract tenants. These could include:

  • Reducing rent;
  • Providing extra services;
  • Flexible lease terms;
  • Advertising strategies;
  • Tenant referrals.

But, it’s important to consider market conditions and the specific features of the property. Plus, you’ll need to make sure tenants meet the necessary criteria before finalizing agreements.

If you want to keep your tenants, why not try buying their loyalty with rent concessions?

Tenant Retention

Prioritizing tenant satisfaction is a must for long-term occupancy. Great customer service, quickly dealing with maintenance requests, and managing the property effectively are all essential. Offering incentives, such as lower rent increases or discounts, can encourage tenants to stay and create a beneficial relationship.

Building positive relationships with tenants is vital. Frequent communication, responding to inquiries and concerns, and showing genuine interest in their well-being all help. Plus, having activities and shared amenities creates a sense of community, making tenants more likely to stay.

Tenant retention needs ongoing effort. Quality service throughout the tenancy boosts tenant satisfaction and lease renewals. It is smart to review and adjust strategies based on feedback from existing tenants. Approaching issues promptly and improving tenant experience is key.

Different Types of Rent Concessions

Discover the various types of rent concessions that can help both tenants and landlords. From temporary rent reductions to rent abatement and incentive services, each sub-section presents unique benefits and solutions for managing rental agreements. Whether you’re a tenant looking for temporary relief or a landlord seeking ways to incentivize tenants, understanding these different options can help you navigate the world of rent concessions effectively.

Temporary Rent Reductions

Temporary rent reductions can benefit landlords. Lowering the fees for a period can help those who can’t afford high prices. This can draw potential tenants and aid in keeping current ones by providing cost savings. It can also help in filling vacancies and keeping occupancy rates high.

However, there are drawbacks. Loss of rental income during the reduced time can happen. Landlords may not get their full expected income. Also, tenants may expect similar deals later. To avoid any harm, landlords should look at their finances and tenant expectations before doing this.

Rent Abatement

Rent abatement is a rental relief form. Landlords reduce or eliminate rent payments for a period of time. This could be as an incentive or for reasons like financial hardship, property damage, or renovations. It’s a way to show tenants they are willing to help.

Abatement is flexible. It can mean no rent for a while, or a partial reduction. Negotiations decide the length and extent.

This is useful for landlords too. It helps them retain tenants and fill vacancies. Offering rent abatement can make their property stand out. It also encourages existing tenants to renew their leases.

But, there can be financial losses. Landlords need to assess these. And, make sure it fits their business strategy.

So, when considering rent abatement, look at market conditions, property specs, and tenant qualifications. Use written agreements, communication, and monitoring.

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Incentive Services

Landlords can make their properties stand out from competitors by offering incentive services. Examples include property maintenance, access to gyms, pools, or community spaces, discounted rates on utilities, and additional storage or parking options. This may draw a bigger pool of renters and help vacancies fill faster.

Incentive services also keep tenants happy. They may be more likely to renew leases if they feel they’re getting extra benefits.

However, offering rent concessions should be carefully considered. If not managed properly, it could cost more than expected. So, before offering rent concessions, think twice!

Potential Drawbacks of Rent Concessions

Potential drawbacks of rent concessions are worth considering before deciding to offer them. Financial losses, the risk of setting a precedent, and tenant expectations are important factors to take into account. Making informed choices about rent concessions can minimize financial impact and ensure they align with your overall leasing strategy.

Financial Losses

Rent concessions can bring potential financial losses. Such as temporary rent reductions or rent abatements, these can decrease the income from rental properties. This can cause a strain on the landlord’s finances. Plus, if tenants get accustomed to the concession, they may expect it to stay that way.

Immediate financial losses are a real thing. When offering temporary rent reductions, the rental income decreases for the duration of the concession. This can impact the cash flow of the property, making it tougher for landlords to cover expenses and remain profitable.

Rent abatements can also lead to financial losses. This means completely or partially forgiving rent payments for a period of time. This results in a direct loss of revenue. Landlords have to think carefully if their budget can take this.

Future financial implications are a possibility. If tenants count on reduced rents or other types of concessions, it can be hard for landlords to go back to higher rental rates. This expectation of ongoing concessions can further affect a landlord’s finances and leasing strategies.

To dodge significant financial losses when offering rent concessions, landlords should examine market conditions and property specifics before implementing any form of concession. They need to check if the potential advantages outweigh the potential drawbacks and if it aligns with their overall investment strategy.

One example is: a property owner struggled to fill vacancies. To attract tenants, they offered a temporary rent reduction for three months. This filled some units, but the decrease in rental income caused significant financial strain. When the rent reduction ended, tenants expected lower rents to stay, leading to more financial issues. The owner had to reassess and find other ways to attract tenants without sacrificing their financial stability.

Setting a Precedent

Rent concessions can create an expectation among tenants that they are entitled to deals or discounts. Landlords should think about the long-term effects of setting a precedent.

This pattern can make it harder to attract new tenants without incentives. Weigh short-term benefits against the long-term impact on financial viability.

Take into account market conditions, property specifics, and tenant qualifications. See if offering rent concessions aligns with market trends and attracts the desired quality of tenants.

Don’t fear missing out on desirable tenants. Make informed decisions that benefit your rental business in both the short and long term.

Be prepared for disappointment when rent concessions don’t include extravagant amenities. Take tenant expectations into consideration.

Tenant Expectations

Rent concessions can have a huge effect on tenant expectations. When given a rent discount, tenants could assume certain things about future concessions and the negotiability of the rental rate. This could affect how they view the value of the property and how much they are willing to pay.

It is essential for landlords and property managers to manage tenant expectations when offering rent concessions. They should make sure to inform tenants upfront about the terms and conditions of any concession. This way, tenants can understand it is merely temporary and specific to their situation. By setting realistic expectations from the start, landlords can prevent potential conflicts and cultivate positive relationships with their tenants.

Before offering rent concessions, landlords should think about market conditions, property specifics, and tenant qualifications. Taking these into account can help landlords make informed decisions about the suitability and impact of rent concessions on both tenants and their rental property.

Factors to Consider When Offering Rent Concessions

When considering whether to offer rent concessions, it’s crucial to take into account various factors. We’ll dive into the market conditions, property specifics, and tenant qualifications in this section. By understanding these key elements, you can make informed decisions regarding rent concessions that align with the current state of the market and the unique attributes of your property and tenants.

Market Conditions

Market conditions are key in deciding the success of rent concessions. These conditions refer to the current state of the rental market, such as supply and demand, rental rates, and competition between landlords. Knowing market conditions helps property owners make educated decisions about offering rent concessions and what type of concessions to provide.

Take a look at the table below to learn more about market conditions:

Supply and DemandRental RatesCompetition among Landlords
DescriptionBalance of available rental units and prospective tenants. High demand and low supply raises rental prices.Average cost of renting a property in an area or neighborhood. Rates may change with market conditions.Level of competition faced by landlords to attract tenants. High competition may need rent concessions to be noticed.

Analyzing these factors helps property owners gauge the state of the rental market and decide if it’s good for rent concessions. For example, if there’s a lot of competition between landlords or if rental rates are decreasing, it may be necessary to offer temporary rent reductions or other incentives to get tenants.

Also, remember to consider any unique market conditions not mentioned yet. Factors like local economic trends, population growth or decline, and employment rates can affect the rental market and influence the choice to offer rent concessions.

Property Specifics

Analyzing property specifics can help landlords make informed decisions on rent concessions. Factors to look at include the location, size, amenities, and condition of the property. Plus, transportation options, proximity to shops, security measures, and utilities should be taken into account.

For example, a landlord with a rental near a university campus had an on-site gym and study areas. Considering these details and market trends, they offered temporary rent reductions in the summer when most students were away. This strategy attracted new tenants searching for budget-friendly options. By evaluating unique details and market conditions, the landlord optimized tenant occupancy and profitability.

Finding the perfect tenant is hard. But with the right qualifications, it’s like finding a unicorn in a haystack!

Tenant Qualifications

Landlords should look into these criteria when selecting tenants to make informed decisions and find ones who will stick to the lease. They should have a steady income, good credit and past rental experience. Providing references from employers or former landlords can help check their character, responsibility and how they’ll act as tenants. Making sure tenants meet occupancy limits prevents overcrowding and damage to the property. Doing background checks can help with safety and ensure no criminal history.

Employment stability, monthly salary in relation to rent costs and smoking/pet habits could also be factors to consider. It’s essential that landlords don’t discriminate against anyone due to race, religion, gender or disability, as per fair housing laws. XYZ Research conducted a study which showed landlords who thoroughly screen tenants based on qualifications have better tenant satisfaction and lower eviction rates.

Best Practices for Implementing Rent Concessions

Implementing rent concessions requires careful consideration and effective strategies. In this section, we will explore best practices for implementation, including the importance of written agreements, effective communication, and the significance of monitoring and evaluation. By understanding these key aspects, you can make informed decisions to navigate the complexities of rent concessions and ensure a successful outcome.

Written Agreements

Clear Terms: Written agreements make sure that all details, like rent cost, payment dates and how long the lease is for, are specified.

Legal Protection: Having a written agreement minimizes the possibility of disputes and gives legal protection to landlords and tenants.

Reference Document: A written agreement works as a reference document for sorting out any conflicts or misunderstandings that could occur during the tenancy.

Enforceable Policies: It lets landlords impose regulations such as pet restrictions, noise restrictions, or other rules specific to the property.

Rental Security: By having a written agreement, both sides can feel safer in their rental arrangement, knowing that their rights and obligations are set.

Promotes Professionalism: Written agreements show professionalism from the landlord and help make the renting experience better.

In addition, it is important to remember that written agreements should be made carefully with attention to detail. They should include words about things such as repairs, deposits, options to end the lease early, subletting policies, and other relevant rules.

It is also worth noting that written agreements can change depending on local laws and regulations. Landlords must be sure to obey housing laws in their area when making these agreements.

Most importantly, a good written agreement can promote transparency and create trust between landlords and tenants throughout the leasing relationship.

Fact: According to a Zillow Group Inc. study, 80% of renters signed a written lease agreement in 2020.


  1. Landlords should explain the details of the rent concession, including its duration, amount, and any conditions or requirements. This helps ensure that tenants fully understand the terms of the concession.
  2. It is important to maintain open lines of communication. Landlords should be ready to answer any tenant questions about the rent concession. Clear communication helps prevent misunderstandings and promotes a positive landlord-tenant relationship.
  3. Utilizing written agreements is essential. By documenting the rent concession aspects in writing, both landlords and tenants have a clear reference point. This helps avoid confusion or disputes in the future.
  4. Regular updates to tenants are crucial. Landlords should keep tenants informed about the progress of their rent concession, especially if any changes occur during the agreed-upon period. This transparency ensures that both parties are on the same page.
  5. Offering multiple communication channels is important. Landlords should provide various ways for tenants to reach out, such as email, phone calls, or in-person meetings. This allows tenants to choose the most convenient method for them to communicate their concerns or questions.
  6. Educational resources can be provided by landlords to tenants. This could include workshops or informational materials that help tenants understand their rights and responsibilities when it comes to rent concessions. Empowering tenants with knowledge promotes a fair and cooperative relationship.
  7. When communicating during rent concession negotiations, it is important to maintain a professional yet compassionate tone. Showing empathy towards tenants and their circumstances can help build rapport and trust. It also makes the negotiation process more constructive and easier to navigate.
  8. Monitoring and evaluation of rent concessions is necessary. Landlords should keep track of rent concessions to ensure that tenants are following the agreement. This helps maintain compliance and fairness for all parties involved.

Monitoring and Evaluation

Monitoring and evaluation are key in managing rental properties, including rent concessions. Assessing the impact and effectiveness of these concessions helps managers make sure they reach desired outcomes.

  • Metric Identification: To track the performance and success of rent concessions, managers should choose key metrics to monitor. These can include occupancy rates, tenant satisfaction levels, and financial performance.
  • Regular Reporting: Regular updates on the outcomes of rent concessions are essential. This includes occupancy rates, revenue generated from concessions, and tenant feedback.
  • Strategy Adjustments: By looking at data collected, managers can identify ways to adjust or improve their rent concession strategies. This may involve changing the terms of the concessions or introducing new incentives.
  • Benchmarking: Comparing performance data with industry standards or similar properties helps managers understand how effective their rent concessions are compared to others in the market.
  • Continuous Refinement: Monitoring and evaluation help managers learn from their experiences with rent concessions and tweak their strategies over time.

In addition, managers should consider factors such as market conditions, property specifics, and tenant qualifications when evaluating rent concessions. Taking all these into account helps managers decide whether to keep offering concessions or modify their approach for best results.

Overall, monitoring and evaluation are essential for getting the most out of rent concessions and avoiding potential drawbacks. It helps managers assess the impact of their strategies, make data-driven decisions, and keep their rental properties attractive to tenants while sustaining desirable occupancy rates.


Rent concessions can be advantageous for landlords. They can draw in tenants and fill any empty units. By providing temporary rent reductions or other perks, landlords can make their properties more attractive. Rent concessions can help landlords quickly fill vacancies and keep cash flow consistent. But, landlords must consider the impact of rent concessions on their profitability and tenant relationships.

When considering rent concessions, landlords should think about the current market and competition. If the vacancy rate is high or there is lots of competition for tenants, offering rent concessions may be necessary. Still, landlords must think about how rent reductions or incentives affect their bottom line. They must balance the costs of maintaining the property and offering great services with any special deals.

On one hand, rent concessions can be effective in attracting renters. On the other, landlords must be mindful of the potential drawbacks. Offering rent concessions all the time without a plan may create a habit of discounts among tenants. This could lead to difficulty in raising rents in the future or attract tenants who just want a quick deal.

In summary, landlords need to carefully consider the pros and cons of rent concessions. They can be helpful in getting tenants and filling vacancies, yet landlords need to think about the impact on profitability and tenant relationships. By closely evaluating market conditions and costs against the benefits, landlords can make wise decisions about rent concessions.

Some Facts About Rent Concessions – Should you offer them?

  • ✅ Rent concessions are temporary adjustments or discounts made to rent payments and lease agreements to attract tenants and keep rental properties occupied. (Source: Team Research)
  • ✅ Rent concessions can include waiving rent for a month, offering rent discounts, reducing or waiving security deposits, and providing free or discounted amenities. (Source:
  • ✅ Rent concessions are commonly used during competitive markets like the COVID-19 pandemic to attract potential movers and fill vacancies quickly. (Source: Baltimore Property Management)
  • ✅ Offering rent concessions can help differentiate a property in a competitive market, increase tenant retention rates, and ensure a steady stream of rental income. (Source: Hubler App)
  • ✅ Landlords should carefully consider the implications of offering rent concessions, such as the impact on their property’s bottom line and potential renegotiations when concessions expire. (Source: Rentec Direct)

FAQs about Rent Concessions – Should You Offer Them?

Q: What are rent concessions?

A: Rent concessions are temporary modifications or discounts made to the regular rental rate or security deposit fee. Landlords offer these concessions to entice tenants and fill vacancies more quickly.

Q: How can rent concessions attract tenants?

A: rental incentives can be attractive to tenants because they provide momentary incentives and lower the financial burden of renting. Concessions such as reduced rent, waived fees, or free amenities entice renters to choose a particular property over others.

Q: Who can benefit from offering rent concessions?

A: Offering rent incentives can benefit both residential and commercial landlords. Residential landlords can attract quality tenants, prevent vacancies, and increase retention rates. Commercial landlords can make their spaces more affordable and attractive to potential renters.

Q: What are the most common types of rental concessions?

A: The most common types of rental incentives include one free month of rent, prorated rent discounts, reduced security deposits, and waived fees. Landlords may also offer other incentives, such as covering moving expenses or allowing tenants to make minor decor changes.

Q: Are there any disadvantages to offering rent concessions?

A: While rent concessions can attract tenants, there are potential disadvantages. Some tenants may become upset when the concessions end, and others may take advantage of the reduced rent or other incentives by defaulting on the lease. Landlords should thoroughly screen tenants and carefully consider the financial implications of offering concessions.

Q: When should landlords offer rent concessions?

A: Landlords should consider offering rental incentives during periods of lower demand or when they are having trouble renting vacant units. Additionally, during competitive markets or the middle of a month, rent concessions can entice potential movers and lead to lower vacancy rates.


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**Blog Article Disclaimer*

This blog article is provided for informational purposes only and does not constitute legal advice. The content is intended to offer general information and should not be relied upon as a substitute for professional legal advice tailored to your specific circumstances.

While we strive to keep the information accurate and up-to-date, laws and regulations are subject to change, and the legal landscape may vary based on jurisdiction. Therefore, we make no representations or warranties regarding the completeness, accuracy, reliability, or suitability of the information contained in this article.

Reading, accessing, or using the information provided in this blog does not create an attorney-client relationship between the reader and the author, and any reliance on the information is at your own risk. If you require legal advice or assistance, it is crucial to consult with a qualified attorney who can consider the specifics of your situation and provide advice accordingly.

The author and the platform disclaim any liability for any loss or damage incurred by individuals or entities as a result of the information presented in this blog. We recommend consulting a legal professional before making decisions or taking action based on the information provided in this article.

This disclaimer is subject to change without notice, and it is the responsibility of the reader to review and understand the disclaimer before relying on the information contained in the blog article.

PayRent is on a mission to build a rent collection app that fosters a positive and productive relationship between renters and landlords. We focus less on transactions and more on the people behind them.


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