Landlords Are Offering Major Concessions in These Markets as Vacancies Rise

While homebuyers struggled with mounting borrowing costs this summer, renters found relief as landlords offered concessions to fill vacant units.

In August, the average share of rental listings on Realtor.com® offering perks—from waived application fees to rent credits and rent-free months—reached 43.5% across the 50 largest U.S. metros, up from 40.4% a year ago, according to the Realtor.com monthly rent report.

At the same time, the median asking rent registered at $1,699, having dropped $65 from its summer 2022 peak.

"Combined with softening median asking rents and a growing concession rate, this suggests renters have more negotiating power and more options to find favorable deals in today's market," says Realtor.com senior economist Jiayi Xu.

Five metros, all tellingly located in the well-supplied West and South, stood out from the crowd for offering the nation's highest concession rates topping 65%.

Denver took pole position with a concession rate of 71.9%, meaning that nearly 3 out of 4 for-rent listings came with concessions. Austin, TX, was a close second with 70.7%, followed by Las Vegas (69.6%), Nashville, TN (69%), and San Antonio, TX (67.9%). 

Building booms and vacancy rates

High vacancy rates are fueling the surge in concessions in those metros. Simply put, landlords would rather offer a discount today than absorb a long-term loss from an unoccupied unit.

The driving force behind this glut of empty units? A construction-fueled inventory boom in oversupplied markets that have become victims of their own building sprees.

In Nashville, Brittany Cyr, broker and property manager at Prime Rentals & Real Estate, says rental inventory has been stockpiling over the past couple of years.

"Driven mainly by all the newly constructed apartments, as well as single-family homes that are not selling easily in this sales market, rental supply is extremely high right now," Cyr tells Realtor.com.

According to the broker, many property owners have become "accidental landlords" after failing to sell their homes for the price they wanted and deciding to rent them out instead until sales market conditions improve.

"It's a perfect storm of sky-high inventory," adds Cyr. "While we do start to see a seasonal slowdown this time of year, that is not what's driving the concessions currently."

Feeling the pressure

A recent Avail survey of independent landlords backs this analysis, with more than 67% of respondents saying they felt market pressure to offer discounts—with high vacancy rates emerging as the most powerful catalyst. 

Among landlords facing the prospect of an empty unit, a third said they offered concessions and more than a quarter considered it. 

However, not all concessions are created equal. According to Avail's survey, among landlords who offered or considered concessions, nearly 38% chose reduced or waived fees, 30.7% opted for upgraded amenities, 25% chose free rent for a period of time, and 6.4% offered gift cards or moving assistance.

Cyr says that in Nashville's rental market, months of free rent is the most popular perk.

"I've seen some apartments offer up to four months of free rent," she notes. Many of her clients who are predominantly mom-and-pop landlords are often unable to waive entire months of rent and will offer instead discounts on the rental price "to stand out in the pack."

Security deposit

The one concession strategy landlords tend to avoid, as both the survey results and listing data show, is waiving the security deposit, which is a landlord's main protection against damage or nonpayment.

"There is way too much risk involved in this concession strategy," confirms Cyr. "In the absence of a deposit, there is nothing the landlord can utilize to easily assess for any damages. This is a nonstarter for my company and our clients."

Concessions are not always just a short-term tactic: For some landlords, they are part of a long-term strategy. According to Realtor.com data analysis, over 5% of rental communities managed by institutional landlords have offered perks continuously over the past 12 months.

That matches findings from the Avail study, where nearly a third of participants who offered renters concessions did so regardless of market conditions.

Locally, Phoenix (14.9%) had the highest share of communities with yearlong concessions, followed by Austin (13.8%) and Denver (13%).

Concessions rose year over year in 39 of the 50 largest metros while falling in just 11. 

The steepest drops occurred in San Jose, CA, and San Francisco, where median rents surged over 4% from a year ago, likely driven by the AI job boom.