question for landlords

[cranberry]

I live in a house that I own outright, but would like to sell it because the upkeep is too much for me.

My plan is to sell the house and then rent an apartment for a year or two before I commit to buying a condo. I just want to be sure that the area I'm targeting is really the right area for me before I buy.

My concerns are that I have been working part time for the past five years (2 years taking care of an elderly relative with dementia and 3 years working on the house that I plan to sell) and I am an independent contractor (I'm a freelance writer). I can prove that I have clients, $60k in savings now (which will increase after I sell the house), and my credit score is 850. I have no debt.

But my month-to-month income - and yearly income - has not been stellar over the last few years because I've been working part time. Once I sell the house, my plan is to go full time.

How difficult do you think it will be for me to rent an apartment? Should I offer to pay 6 months of rent in advance?

Many thanks!

[Gardening Grandma]

Speaking as a landlord here, offering 6 months of rent in advance would not appeal to me much. I would expect first/last/deposit up front.

If you were to explain to me your erratic income and offer to show me your credit score and bank balance, I would probably conclude that you could afford the rent. (That's just one opinion, fwiw)

[phil5185]

Long time landlord. Agree with GG. I would rent to you based on your Net Worth, a proof of last 2 years income (tax returns), and your story of your plan. But your offer to pay 6 months rent might scare me off, I would feel that you were hiding something - I would wonder who all was going to be sneaked in as 'visitors'. etc.

[debtheaven]

Interesting question. I'm a landlord too and it would probably worry me too.

This said, I had a friend in this situation a few years ago. Her daughter was entering prep school to get into vet school (I'm in France, different educational system here.) The parents wanted to rent a studio for their DD near her school so she didn't have to commute from the suburbs. The mom worked VERY PT (ie three hours a week), the dad had retired very young and was working as a consultant at that point, so his income was not stable.

Nobody would rent to their daughter because they had no stable income. They finally found somebody to rent to their daughter: turns out it was a man from the dad's alma mater. So he accepted a years' rent, plus the security deposit (I'm in France so that's what's required here). They did it again for a second year. It worked out very well.

So you may find somebody willing to do it, but I'm not sure most people would be. Good luck!

[cranberry]

Thanks very much! There's a lot to think about here.

I wonder if I would be better off waiting to sell the house and getting back to full time income first. I want to sell because I feel it will help me move forward in my life, but maybe it doesn't make financial sense at the moment.

Hmmm...

[Deleted]

While I prefer to rent to folks with W2 income I did rent to a woman who was in a similar situation. Great credit, $500k in the bank but a consultant with erratic income. She did offer to pay a year's rent in advance but I didn't want all that extra income at the end of the year ($24k in December).

I rented to her. Part of the reason was that we weren't having very much luck (house was vacant for about 3 months as we had moved overseas) and her banking references were great,. She's turned out o.k. At first she was a pain because I think she's OCD and kept coming up with lists of things that needed to be done around the house. But she settled down after a while. I do have to say that she's kept our house cleaner than I ever did.

I like Phil's recommendation.

One idea I've tried before is to beef up the deposit to say 2X (keep in mind different states have different limits CA is 2X for an unfurnished unit). That way the LL will feel that s/he will have enough time and reserves for legal action if you stop paying your rent.

Keep in mind that Phil, GG and I all rent out SFH. You might want to call around to a couple of apartment complexes and ask them for their requirements and whether they would consider renting to someone in your situation.

[Gardening Grandma]

Another option (I'm assuming that you are single, and have no pets) might be to check out craigslist (or ask around) for a roommate situation for a few months.... Someone who wants to rent out a room or part of their house.

[Mad Dawg Wiccan]

Have you considered renting the house out instead of selling it, at least until you are ready to buy a condo?

[TheOtherMe]

I have found that large, corporate owned apartment complexes go only by your credit score. Since yours is 850, you might do just fine.

[cranberry]

Many, many thanks for all the helpful info and ideas!

I've since called a few apartment complexes and they require that rent not exceed 30% of your income. That's reasonable, but it doesn't work for my situation.

In the meantime, I've been driving by different areas that interest me and I'm not 100% sure that this area will be for me. I'm starting to think more about staying in my current town and just going from house to condo. I just have to figure out how to make it happen financially.

I don't think I have the temperament to be a landlord. And I do have a cat, which makes the roommate idea a little more difficult.

Well, I'll figure it out. Thanks again!

[Mad Dawg Wiccan]

If you don't like the idea of being a landlord, there's also the option of having a property management company doing it. Not as profitable, but also fewer headaches.

[zibazinski]

I have had no income for almost 4 years from a job. I have never had an apt complex refuse me. I show them my credit score and my account balances and my rental income. No problem. Go and talk to a rental complex. They will work with you.

[cranberry]

Thanks, folks. I'm feeling better now!