Is it better to give than receive?

My wife and I were discussing whether we should provide gifts to our tenants this year. You see this in some RE books as a tactic to retain more long term tenants. I have talked to other landlords that do this, but I am torn on this tactic. It sets an expectation that you will do it every year. I also feel it can blur that line of tenant to landlord relationship.

My thought was perhaps a card, but nothing more than this. At the other end of the spectrum is say $50 off the rent. I really don’t like this. I prefer tenants always pay the full amount of rent every month – no exceptions. In any event, $50 is too much. If you go with a cash gift, I say no more than $25. I have also heard some say you should get them a gift card at Home Depot and maybe they will use it to improve your property. I would like to think they would spend it on a tube of caulk, cleaning materials, or AC filters – but with my luck they would buy wallpaper and roll a bathroom.

I read somewhere else a batch of homemade cookies shows some thought. This seems like a nice gesture that is economical, but somehow a little too comfy for my liking. It’s not like I am all business – I am very friendly to my tenants and stay and chat for a few minutes when picking up rent. But with decent tenant retention now – I hate to mess with it.

The question is, Will a small gesture around the holidays, make a difference? My wife thinks so. Her exact words, “Most landlords only want the check each month, but this signals to them that I care about them as an individual too.” She has been better than me when it comes to tenant management – so perhaps she is right. This will certainly differentiate you from the many apartment complexes, tight landlords, and really stiff property management companies. And don’t forget – it’s deductible.

So we went through our current tenant base and feel 3 of our 8 tenants are worthy of a gift this year. These 3 have been with us for over a year, never late on the rent, and we definitely want them to stay. We excluded our refugees from Iran as they don’t celebrate our holidays and might find this awkward. We have students in another property, but this would not sway them to stay longer. Our other tenants have been with us for less than a year or are not ideal tenants.

Our plan is $25 Walmart gift cards. I will take notes on any perceived results and post about this later.