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A rent-free period refers to a period of time in which tenants can inhabit the premises of the rental property belonging to the landlord without requiring to pay rent.
However, don’t be misled into thinking that it is free accommodation.
The uncollected rent is usually rolled into the next payment due, spread into the following scheduled rental payments, or pushed to the back end of the lease.
As such free-rent periods will be more appropriately called deferred rental.
While tenants are seldom fools who really think that they are leasing a place for free for a certain period of time, the free-rent period helps those who are experiencing cash flow problems.
This can be a common occurrence when tenants are new to the area and relocated just to find job opportunities in the city. Thus, don’t have a lot of cash savings.
Consider that a new tenant has to pay for the security deposit, rental for the first month, stamp duties, and even basic furnishing.