Landlords gifts for tenants can change the stereotype of landlords as money-hungry people who just want their hard-earned cash. Veteran landlord and investor Larry Arth shares his story on landlords gifts for tenants.
By Larry Arth
After I was married 33 years ago, my gift-giving list during the holidays grew exponentially with all the additional mother-in-law, father-in-law, brothers, sisters and even aunt and uncle in-laws. I remember after an exhausting day of shopping and purchasing the final gifts telling my wife, “Whew, glad to have that done.”
Her reply was, “What are you doing for all the tenants?”
What, I have to buy tenants a gift?
Up to this point I had not even given it a thought. But once I thought about it, it did make sense. After all, employers give gifts to their employees to show they are thinking about them and appreciate their work. I, of course, really appreciated my tenants. Even though they periodically drove me crazy, they were an important part of my business.
I must admit, I knew I could probably gain some good mileage from remembering them during the holidays. I mean, small gifts can go a long way to show that you appreciate them. Now I just had to determine what to get them. Sending a gift card made the most sense, but to where?
As a person who likes to test and measure, I gave tenants in one building a $50 gift card to the nearby local grocery store.
And in another building, I gave a $50 gift card to the local Target. I wanted it to be a gift card that would allow them to buy something the whole family might be able to use.
The outpouring of gratitude was much larger than I could ever have expected.
Tenants were in total shock to receive a gift from the landlord. The stereotype of landlords is they are money-hungry people who just want their hard-earned cash. Funny how a little gift can change that image so quickly. While the Target card appeared to go over better, both created the same gratitude. This gift card allowed my tenants to make purchases of items the whole family needed. During times when money was extra tight, their appreciation was extra strong.
I wrote gift-giving into my business model
Seeing the great response to my Christmas gift cards, I came to the conclusion that my success in the landlord business was in direct proportion to the number of people who, when thinking of a landlord, thought of me. I had heard this statement at a conference, too.
After all, investing is all about the return on investment, and if the small investment in gift-giving creates such widespread recognition of me as a great landlord, I must keep doing this.
Landlords gifts for tenants in my business model:
Children’s birthdays: A gift certificate to McDonald’s for a free ice cream cone. This $1 investment had the children talking about me for days before and after their birthday. I remember a tenant telling me that her daughter was asking her for a week in advance if she thought Larry Landlord would remember her birthday and send her another ice cream cone certificate. Needless to say, I won over the children, and when I visited the place and asked them to keep their bikes off the sidewalk or to keep the common hallways clean, they were happy to assist. Also, moms and dads love it when you think of their children. While the return on this $1 investment may not be measurable, I believe it to be one of my best investments.
Thanksgiving gift: A simple gift card for a turkey at the neighborhood grocer. No better time to send a thank-you card letting tenants know you appreciate them than Thanksgiving itself. The interesting part is, Thanksgiving is not a typical time one expects to receive a gift, so it makes it more of a surprise. The bigger the surprise, the more they remember it.
Christmas / holiday gifts: As mentioned above, we sent Target cards as gifts for tenants, and eventually we started sending out holiday cards, too, to satisfy the masses.
Annual renewal gift: This one proved very interesting. When it was time to renew the lease, we would send out a lease renewal along with a card that said “free four-hour handyman” for their renewal anniversary. We had certain limitations here, of course. It was usually painting a room or two, or hanging shelves or a cabinet. Once, we even gave a tenant a new kitchen floor. It was always at our discretion, of course. The idea was to give the tenants things they wanted. These were mainly fair requests, as they were items that were needing attention anyway. Giving this as a gift without them having to ask for it was special to them. Spending the money only helps maintain the property and created good will to boot. This gift offset any negative reaction to the rental increase.
The return on investment:
- Tenant turnover was very low, which as you know saves you, the landlord, money.
- Tenants felt like they were part of a community as opposed to a meal ticket for their landlord.
- They were happy tenants who always gave me referrals of other tenants looking for property.
Creating happy tenants was a very inexpensive way to keep tenants and create referrals, making for probably a better overall ROI than the investment itself.
Happy holidays and happy investing.
Larry Arth is also a real estate agent in Florida.