Glossary term
Concessions
Concessions are discounts that lower what a new resident pays, such as free rent, reduced deposits or waived fees, used to attract and lease up units.
A concession is any incentive that reduces the cost of moving in. Common examples include a month of free rent, a lower security deposit or waived application and move-in fees.
Managers use concessions to fill units faster when demand is soft or a new building is leasing up. They cost income, so they lower effective rent and economic occupancy even when the building looks full.
A rising level of concessions in a market often signals more supply or weaker demand. Tracking them helps owners decide whether to hold rent or price to fill.
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