> Does this "first tenant" rule not incentivize people to apply immediately, sight unseen

Is that a bad thing? Presumably that means they liked something about your rental. Happened a ton during COVID.

> Or maybe they can even bail before the credit check is done, if they can see all of their candidate apartments in that time

I highly doubt this happens in practice. It can be like $50 per application easy - renters are in general cost conscious. I certainly only put down the fees on apartments I’m serious about (usually two max). Why waste money?