Concession
A concession is a leasing incentive, such as free rent or a reduced deposit, used to encourage lease signings or renewals.
Definition
A concession is an economic incentive offered by a property owner or operator to encourage a prospect to sign a lease or a resident to renew. Common concessions include free rent periods, reduced deposits, gift cards, or other discounts that lower the resident’s effective cost without necessarily changing the advertised base rent. In multifamily operations, concessions are often used during lease-ups, competitive market cycles, or periods of higher vacancy.
Example
A community with several vacant one-bedroom units offers one month free on a 12-month lease. The advertised rent remains $1,800, but the concession reduces the resident’s net effective rent over the lease term.
Why It Matters?
Concessions help leasing teams maintain occupancy and leasing momentum, but they also reduce net effective rent. Operations leaders need clear tracking and communication of concessions so pricing, leasing, accounting, and performance reporting reflect the true economics of each lease.

