Deciding To Use Incentives Or Not In Senior Living?

Deciding To Use Incentives Or Not In Senior Living?

Incentives in Senior HousingWhat Is The Best Incentive You Have Ever Given In Senior Living?

Discounting can be the owner’s operational nightmare and the sales persons best friend.  Incentives cost the company money and affect the bottom line.  Just giving away one month of rent can cost $2000 – $6000 depending on the retirement community.  Yet, empty apartments are losing revenue month-after-month.  Should you or should you not use incentives?

I believe that incentives can permanently ruin some sales people.  Some sales people can ONLY sell apartments with incentives.  When the gravy train stops they don’t know how to just simply sell an apartment at regular price to a senior.  Seriously?!?  In my opinion, this is right up there with someone who is simply an order taker in senior living.

The benefit of incentives is bumping up the occupancy to get ahead of the move outs in a very short period of time.  Every senior living community has to look at their financials and determine what is best for them.  If you have more two-bedrooms than one-bedrooms, an incentive on two-bedrooms can create balance again in your inventory.  It is a funny thing in our industry – how every five years the surplus of a certain size apartment switches.  Right now everyone seems to want a one bedroom…

Here are some common assisted living and independent living incentives:

  • One free month
  • The fourth month free
  • No move in fee or a discount on the community fee
  • A free TV
  • A moving or downsizing allowance

Continuing Care Retirement Communities can use the same or different incentives:

  • 90 – 100% Returnable entrance fees
  • A percentage off future healthcare
  • Paying for the move completely
  • Discounting apartments that are the farthest walk from the dining room
  • A discount off the entrance fee if a prospect commits to moving in within a short period of time

Do you use incentives?  Which ones?  Which incentive in your career resulted in the biggest flurry of sales for your retirement community?  My favorite incentive of all time was a 100% returnable entrance fee at a new community that I opened.  It worked like a charm!  Within months, 70% of the building was spoken for, so we could start construction.

Please comment to join the conversation and interact with other senior living professionals on what is currently being effective to increase occupancy on a nationwide basis.

Diane Twohy Masson is the author of Senior Housing Marketing – How to Increase Your Occupancy and Stay Full,” available for sale at  Masson’s book will be required reading at George Mason University in the Fall as part of the marketing curriculum.  She is currently consulting with Seniors For Living and two debt-free Continuing Care Retirement Communities in Southern California – Freedom Village in Lake Forest and The Village in Hemet, California. Connection and partnership opportunities: Email:


  1. LinkedIn Senior Assisted Living Sales, Marketing & Operations

    I think the “guarantee” is the best idea, as you say. If the facility is a good one, it won’t cost anything and gives the resident peace of mind.
    By Lorie Eber

  2. LinkedIn Senior Assisted Living Sales, Marketing & Operations

    While I’ve never been a big fan of incentives we have, from time to time, “buckled” to the pressure of the market and used them. To be clear, what I don’t like about incentives is that I feel they “cheapen” the community and detract from the value that we are selling. I think the incentive also becomes a potenital wedge between the the honest relationship that our retirement counselors are striving to establish with a prospect. Speaking out of the other side of my mouth, we have very successfully used the incentive of paying for the actual move along with a sort of “counseling service” to assist in the move. The age old question of: “What am I going to do with all this stuff?” and “Just thinking about the move is simply overwhelming to me!” are objections that I think are very real and sincere. So, for our retirement counselor to be able to say: “I completely understand your feelings. We have a moving service that can assist you and that we’ve worked with in the past. Would that make this process easier on you?” is a GREAT way to not only solidfy the relationship but also to move the move along.
    By William Wexler

  3. LinkedIn Senior Assisted Living Sales, Marketing & Operations

    I have served senior housing for over 18 years. I have worked in the for profit and not-for -profit environments. I have presold a project at over 80% with no incentives other than a very nice gift basket. I have utilized a referral fee program for new clients. The referral fee program served well as for each move-in the current client received a reduction in rent or for additional services.

    I have sold rental contracts and CCRC contracts with refundability from 50-100%. The individuals without heirs preferred the 50% contract with a lower monthly fee.

    Thank you. Maureen
    By Maureen M. Smallwood

  4. LinkedIn Licensed Nursing Home Administrators of America

    As the national average for senior living occupancy hovers around 88 percent, providers are seeking creative options for bumping up rates, says an article from the Assisted Living Federation of America.

    According to the piece, offering discounts to prospective residents is one approach providers are pursuing to “boost move-ins.” The most popular discount has been “reducing or waiving the move-in fee,” per the article, a savings of $2500 to $5000.

    Other financial incentives include moving allowances and tiered discounts, all with the goal of moving seniors and their families more quickly through the decision and transition process.

    The fragile state of the housing market has certainly prompted the offering of such incentives, and as the economy continues to recover, providers may have to continue these cost-reduction opportunities to increase their occupancy numbers.

    Financial challenges like these will be part of the senior living operators’ landscape for several years or more. Yet the fact remains: there is a need for different types of senior housing, and this reinvention and evolution is a natural part of the growth process for this still young industry.

    Your turn: Would a senior living discount be the difference between yes and no for your family?
    By Uzma Qureshi

  5. Linked In Senior Living Executives

    I concur with the cautions contained within the article. As always, Diane has raised an issue of importance that needs appropriate review, financial analysis and impact feasibility, etc. My experience is that each time this is considered, it becomes a unique set of circumstances that requires intense thought, particularly on a regional and timely basis. Sometimes it is necessary, for a whole variety of reasons, but I have found that it should be short term, something “special” for a specific set of reasons and timing, and certainly the needs and reactions of the existing residents need to be considered. All members of the management team and sales/marketing effort need to be on board, with the same message. I concur with the goal of “Zero Lost Revenue Days” over the long term but achieving that goal is unique to each setting.
    By Michael Coler

  6. LinkedIn National Senior Living Providers Network

    Create a “Welcome” package that includes 12 free guest meals so that the new resident may invite 12 friends to visit…one per week over the first three months. It’s an ideal way to get new leads. Include a salon visit or a basket of hair care products provided by your supply company or salon. Can you offer the use of a space for a “Complimentary Party Room” for use by the family. If the budget permits, you might supply complimentary coffee, balloons from the Activity dept., paper products,. If not, the space can be used by a resident or family for a special event. Can your staff assist with the moving process? Can you work with outside companies that help seniors to downsize so that the resident and family are not as overwhelmed with the process of preparing for a move? Do you have a staff person who can help to measure furniture, develop a fit plan using your floor plans from the sales materials? Do you have packing materials or help to assist with packing? Do you offer the use of your model suite or an empty suite for family members from out of town who may be assisting on move day? Do you offer to help with change of address, notifying family, friends and contacts re the new address? Does your maintenance department have the ability to help set up computers and tech equipment for a new resident? Can you print new return address labels, send out postcards (with the community picture on them of course), etc. to help communicate the move to X Community? Can you permit the new resident to host a small “Open House” for former neighbors, friends, clergy to visit them in their new home? What a great lead generator. Serve light refreshments and offer tours of course. Do what you can with the resources you already have in place. Be creative.
    By Carolyn Lookabill

  7. I think you have to know first which of the two, use incentive or not, can give you most benefit. But I still believe it all boils down to how well the overall service of the facility. If a facility is really good, people will choose it with or without any incentive.

  8. What are everyone’s thoughts on paying nursing home Social Services Directors and hospital Discharge Planners/Case Managers referral fees to refer to assisted living facilities, board & care homes and non-skilled caregiver companies? Are there laws against it? Can they get into trouble at their facilities?


  1. 9 Links to Kick off March « Senior Industry Blog – New LifeStyles - [...] Deciding To Use Incentives Or Not In Senior Living? [...]