Rents Are Rising, But Cash Rewards Can Ease the Sting for Tenants

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WSJ Your Money Briefing 6 min 3 speakers 2 chapters transcribed 2 months ago
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J.R. Whalen 0:18
Here's your money briefing for Tuesday, August 27th. I'm J.R. Whelan for The Wall Street Journal. Earning rewards like miles or cash back from shopping has been around for years. Now many landlords are allowing their tenants to get in on the action just for making their monthly payments on time.
Katherine Hamilton 0:37
If it's a points-based rewards company, a lot of times they partner with companies like Amazon or HomeGoods that you can cash your points in and get an Amazon gift card. And then also a lot of people are paying their rent online now, so those online platforms are also contributing.
J.R. Whalen 0:54
We'll talk to Wall Street Journal personal finance reporter Catherine Hamilton after the break.
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How are landlords starting to offer rewards for on-time rent payments?

J.R. Whalen 1:47
For many tenants, a rewards program can take some of the sting out of paying rent. Wall Street Journal personal finance reporter Katherine Hamilton joins me. Katherine, is getting something back in return for rent payments something new?
Katherine Hamilton 2:01
It's not new per se, but getting rewards on a monthly basis is relatively new for rent payers. A lot of landlords historically have given out concessions, which is a financial incentive like a month of free rent. And that's always been the case. But now a lot of companies are partnering with landlords and offering monthly rewards like points or cash back.
J.R. Whalen 2:23
How common is this?
Katherine Hamilton 2:24
At least 2 million renters are currently getting cashback points, some version of monthly rewards from some of these newer companies that are offering renters rewards.
J.R. Whalen 2:34
You mentioned cashback and points. What other kinds of rewards do tenants typically receive?
Katherine Hamilton 2:40
Cashback and points are the primary types of monthly rewards other than, like I said, like the month of free rent, those sort of traditional concessions. But these newer companies are primarily doing cashback and points.
J.R. Whalen 2:53
So how does this work? Do the perks come directly from the landlord?
Katherine Hamilton 2:56
Usually these companies that offer rewards do have the landlord pay for most of the rewards, but there's a few different streams it can come from. So if it's a points-based rewards company, a lot of times they partner with companies like Amazon or HomeGoods that you can cash your points in and get an Amazon gift card or reusable paper towels. And those companies will also add to the points and the value of the points. And then also a lot of people are paying their rent online now. So those online platforms are also contributing.
J.R. Whalen 3:29
Reusable paper towels. Does that come up often with people you talk to?
Katherine Hamilton 3:32
That did come up with one person I spoke to. She lives in New Jersey. She's rented her whole life, and she gets points back now for paying her rent, and she's cashed in those points for, she said, a really nice set of colored pencils for her daughter and reusable paper towels.
J.R. Whalen 3:48
All right. How would a tenant sign up for this kind of program?
Katherine Hamilton 3:51
Usually it's through the landlord. So these landlords are offering this sort of as an incentive to draw tenants in and say they can get a little return on their housing investment.
J.R. Whalen 4:01
How do these rewards or concessions compare to the cost of rent?
Katherine Hamilton 4:05
They're pretty much a drop in the bucket compared to rent. As you may know, rent has increased a lot since the pandemic. It's up about 20%. And it's now about $1,750. So if you're getting, let's say, the points back with something like Pinata, which is one of the companies that offers points, Pinata says they give back about $125 per year on average to renters enrolled.

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