Author Topic: Early retiree: Is it challenging to qualify to rent an apartment?  (Read 8329 times)

BigMoneyJim

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I retired four months ago at the age of 49.5. I'm planning to sell my house (in Irving, TX) and rent an apartment in the Puget Sound WA area (probably Bremerton or elsewhere in Kitsap County). And I'm open to moving around during retirement, maybe moving several times in a few years.

I'm concerned about applying for apartments and them being ok with renting to me without income. I'm eligible for a pension in about 5 years and SS in 12 years, but otherwise I'm drawing on my assets for expenses.

My FICO score is 844, so that's not a problem, but I have no income. I've already had a challenge opening a new savings (!) account with Wings Credit Union; they asked for verification of retirement income after dragging my application out two weeks. I don't know if that's typical or if they're just weird. But it just seems like the world is set up for people with income and credit scores.

So, is there a problem or a trick to renting as an early retiree with no income to show?

Edit: My biggest fear here is that I'll get the house under contract and then be forced to live in a weekly hotel indefinitely.

Padonak

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #1 on: February 04, 2020, 10:33:17 AM »
Ptf

ShastaFire

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #2 on: February 04, 2020, 10:36:53 AM »
Puget Sound sounds wonderful, BigMoneyJim.

Noticed some great ideas in this thread:

https://forum.mrmoneymustache.com/post-fire/how-to-rent-an-apartment-when-you're-fi/


Paul der Krake

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #3 on: February 04, 2020, 10:46:10 AM »
Just did this a few months ago, two young adults but zero jobs.

It's more awkward than challenging. As I'm touring the place I work into the conversation that we don't have jobs right now, and ask if proof of savings would be sufficient. Watch their reaction closely and go from there. Based on that conversation, choose how much you're willing to reveal. I'm sure some will be fine with just a couple months' rent in a savings account, and that the other end of the spectrum some nosy landlord will want to see brokerage statements going back to the Reagan administration. This is also a good indicator of how chill they're going to be in general.

I chose to show about 10 years' worth of rent in a boring brokerage account and that was sufficient. We signed a lease 3 days later.

MoneyTree

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #4 on: February 04, 2020, 08:14:36 PM »
Very interested in this topic as well. We are close to FIRE for our current expenses, but with a growing family it’s very possible that we will need to rent a bigger place sometime in the future. Possible, but not certain.

I don’t want to delay FIRE too much for uncertain potential expenses that may or may not ever come.

But I don’t want to just upsize now while I still have regular W2 income because then I’d be throwing away money for extra space that I don’t need right now.

Buying a home in my area is prohibitively expensive.

Ideally we stay where we are right now, I retire this year on schedule, and then we rent a bigger place when we need it, a few years into retirement. The problem is I’m not sure that many people will be willing to rent to an under-40-year-old with a family and no earned income.

dblaace

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #5 on: February 05, 2020, 05:49:44 AM »
I retired four months ago at the age of 49.5. I'm planning to sell my house (in Irving, TX) and rent an apartment in the Puget Sound WA area (probably Bremerton or elsewhere in Kitsap County). And I'm open to moving around during retirement, maybe moving several times in a few years.

I'm concerned about applying for apartments and them being ok with renting to me without income. I'm eligible for a pension in about 5 years and SS in 12 years, but otherwise I'm drawing on my assets for expenses.

My FICO score is 844, so that's not a problem, but I have no income. I've already had a challenge opening a new savings (!) account with Wings Credit Union; they asked for verification of retirement income after dragging my application out two weeks. I don't know if that's typical or if they're just weird. But it just seems like the world is set up for people with income and credit scores.

So, is there a problem or a trick to renting as an early retiree with no income to show?

Edit: My biggest fear here is that I'll get the house under contract and then be forced to live in a weekly hotel indefinitely.

Hey neighbor I'm in Grand Prairie.

EndlessJourney

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #6 on: February 05, 2020, 09:09:49 AM »
I think your problem is not that you are an early retiree, it's that you have a lack of references.

We've been funemployed for eight years, but in that time, we've built up a healthy record of long-term stays where we can always count on stellar references from our previous landlords.

In my experience, multiple positive references and a credit check seem to trump income. You can be making six figures, but if most of that income is going towards obligations like car payments, daycare, paying the monthly minimum on maxed credit cards, then skimping on the rent might be more of an attractive option than a retiree with no debt.

Just a thought: can you put down a deposit of an extra month's rent? Refundable after a year of timely payments?
« Last Edit: February 05, 2020, 09:37:48 AM by EndlessJourney »

Dr Kidstache

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #7 on: February 05, 2020, 09:01:13 PM »
I haven't had any trouble renting. Maybe just lucky so far? I'm not ER but I'm in a similar situation because I'm disabled and unable to work. All I've needed is a good credit score and I've shown a copy of my bank statement to demonstrate that I can afford the rent fine.

mcluhan

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #8 on: February 06, 2020, 12:20:45 PM »
Won't landlords accept copies of past tax returns and bank statements as proof of income?

BigMoneyJim

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #9 on: February 06, 2020, 12:58:02 PM »
Thanks all! I feel more at ease about not getting "stuck" in weekly/monthly hotels.

@spartana You seem to be an outlier. My best uneducated guess is that a combination of credit score and income is the trick, and if you lack both you might be in trouble? Or maybe it's where you live? I'm guessing for the greater Puget Sound area, for example, that there is a difference in renting downtown Seattle from a big apartment chain corporation and renting an hour or two away from downtown.

But I don't really know which would be "harder" for an early self-funded retiree. Are the corporations more easy going, or are the smaller/individual landlords more accepting?

Paul der Krake

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #10 on: February 06, 2020, 01:08:36 PM »
Ex Seattle BigApartments dweller here. I can tell you from experience that the big corporations are very amenable to taking your money and will bend over backwards to get their occupancy numbers up. Their target demographic is BigTech employees who aren't price-sensitive, so they are used to seeing affluent renters with weird employment status, or who are new to the state/country, or both. I feel confident in saying that you could walk in to a leasing office at 10am and have a signed lease by EOD. Whether or not you're paying a good price is a different story and completely independent of your financials.

@Dr Kidstache any landlord worth their salt is going to be treading veeeeery carefully when someone with a disability shows up to rent a unit. The last thing they want is a discrimination lawsuit.

MrThatsDifferent

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #11 on: February 06, 2020, 02:08:01 PM »
This doesn’t address your issue, but what about house-sitting or Airbnb for long stays? Otherwise that’s a sucky problem to have that I never thought about. Another option might by sharing a place. Since you want to move around a bit, maybe the travel light, move freely method would work for you until you’re ready to settle? I sure you could offer a year’s rent in advance and some would go for it.

BigMoneyJim

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #12 on: February 06, 2020, 03:24:49 PM »
I have a cat, so I feel a bit limited in considering lots of moving for another few years, but it's in the back of my mind after kitty is gone. I've also been in this house for 9 years and used to be a minor pack rat, so the next move is also a bit of a trial in downsizing, but I think I could get pretty minimal with today's technology and my waned interest in hobbies and activities that require lots of "stuff".

So for the moment I have a yearly lease in mind, but there's no absolutes here.

BigMoneyJim

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #13 on: February 06, 2020, 03:33:22 PM »
^That's what I ended up doing - renting monthly furnished vacation rentals - and that was very easy. Give them a CC, sign a form and you are good to go. If done somewhere during the low or off season for a mo th or longer it can be very inexpensive and usually fully furnished and all utilities included. Think Puget Sound in winter. Also a great way to check out an area during the "bad" season before making a costly perm move there.

There*is* a particular Airbnb I'm absolutely head over heels in love with, and they*do* have a monthly discount. It would be more than I figured on paying, but as priced it includes utilities. Haven't checked if pets are OK, but I had planned on checking with them on longer terms. Also have to see if fees and taxes would make things untenable if considering Airbnb terms.

It started me on a cost vs want thought train. The more I think of it, the more I want it. I'm just not sure how wise it is financially, but I know the experience would be very much enjoyed.

Dr Kidstache

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #14 on: February 06, 2020, 06:42:33 PM »

@Dr Kidstache any landlord worth their salt is going to be treading veeeeery carefully when someone with a disability shows up to rent a unit. The last thing they want is a discrimination lawsuit.

Hmmm, maybe that's why I've not an issue. I have a service dog, though, and I suspect that the alternative would be more likely - deny rental for financial reasons as a cover to not have to accept a dog. The only two places I've rented since becoming disabled were both from landlords who only own one rental property and live nearby. They both ran a credit check and just took my word that I have disability income.

Goldielocks

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #15 on: February 08, 2020, 09:57:29 PM »
@spartana
Re: income needed for rent.  When I was investigating being a landlord in CA, I found out that rejecting candidates based on income and credit were the only two reliable, legal, non-discriminatory ways allowed to reject candidates, so rental managers are advised to STRONGLY require 3x rent prooved in income.

And if you reject 2 people for that reason, you can't accept the third person with all the assets and no income and not be looked at as discriminating for other reasons.

There, I don't think landlords were really supposed to take 10 months of rent upfront (I forget why, something quasi legal about overcharging for first and last months rent).

And asset rich people who don't own homes are quite rare, so none of the Property Management paperwork and standard legal advice allowed for that scenario. 

Gronnie

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #16 on: February 08, 2020, 10:42:35 PM »
I think a big problem is that a lot of the anti discrimination in housing laws end up discriminating against people in non standard situations.

They put in place rules about minimum credit score, minimum income, etc and are unable to work in logic to non-standard situations (and I can’t really blame them in our litigious society) because they don’t want to open themselves up to lawsuits.

TomTX

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #17 on: February 09, 2020, 12:03:10 PM »
Seems pretty plausible to me to show brokerage records with dividends, and call the dividends your reliable income stream.

Paul der Krake

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #18 on: February 09, 2020, 12:09:30 PM »
Seems pretty plausible to me to show brokerage records with dividends, and call the dividends your reliable income stream.
If you have a massive brokerage account sure. In my case the yearly dividend stream amounts to less than 1/3 of the yearly rent, so I'm glad they considered other things.

Mr. Green

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #19 on: February 09, 2020, 01:14:23 PM »
This is something I'm starting to pay more attention to myself. My wife and I are coming up on 2 years now with no real job income. We may want to relocate in the future and renting is a possibility but I'm concerned about our appeal. We've only ever owned a house until 3 years ago and then we moved in with friends so probably not a great landlord reference since it isn't a formal lease arrangement.

Padonak

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #20 on: February 09, 2020, 03:55:31 PM »
This is something I'm starting to pay more attention to myself. My wife and I are coming up on 2 years now with no real job income. We may want to relocate in the future and renting is a possibility but I'm concerned about our appeal. We've only ever owned a house until 3 years ago and then we moved in with friends so probably not a great landlord reference since it isn't a formal lease arrangement.

Do landlords now require references AND formal lease agreements from previous addresses these days? Nobody has ever asked me for a formal lease when they checked my references as a tenant.

I mean just the fact that landlords ask for your references but you can't really ask for their references is infuriating enough. If somebody has the nerve to ask for my previous leases too, I can say hey, you show me yours i'll show you mine. Show me how much you charged previous tenants for the same apartment.
« Last Edit: February 09, 2020, 03:57:39 PM by Padonak »

BigMoneyJim

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #21 on: February 09, 2020, 07:33:57 PM »
I'll be sure to update the thread when I start talking to apartments, make an application, and move.

I think I've decided to target large complexes with leasing offices that have daily staff.

My reasoning has several factors. First, it's what I'm familiar with from the past. So their policies and attitudes should be somewhat predictable and normalized compared to lower-turnover buildings. And I'll be just another occupancy number to them instead of a significant portion of their cash flow. And since I'm newly retired, moving to a new area, and going through major life changes already, keeping to a familiar, consistently-run complex with enough turnover to nearly always have vacancies takes a lot of the unfamiliar/unknown away from my first move in retirement.

I haven't done a ton of research yet, but the first apartment complex I looked at has their acceptance policy posted, and for retirees/self-employed/etc. they want the past two years' tax returns and current bank statements. That should be an easy enough bar for me to clear as I made plenty the past two years as I only retired in October 2019.

So by the time my income days are far behind me I'll have recent rental references built up again.

Goldielocks

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #22 on: February 12, 2020, 02:07:58 PM »
I'll be sure to update the thread when I start talking to apartments, make an application, and move.

I think I've decided to target large complexes with leasing offices that have daily staff.

My reasoning has several factors. First, it's what I'm familiar with from the past. So their policies and attitudes should be somewhat predictable and normalized compared to lower-turnover buildings. And I'll be just another occupancy number to them instead of a significant portion of their cash flow. And since I'm newly retired, moving to a new area, and going through major life changes already, keeping to a familiar, consistently-run complex with enough turnover to nearly always have vacancies takes a lot of the unfamiliar/unknown away from my first move in retirement.

I haven't done a ton of research yet, but the first apartment complex I looked at has their acceptance policy posted, and for retirees/self-employed/etc. they want the past two years' tax returns and current bank statements. That should be an easy enough bar for me to clear as I made plenty the past two years as I only retired in October 2019.

So by the time my income days are far behind me I'll have recent rental references built up again.

Those large complexes are also easy ways to build up your Landlord references, as they have a system in place for that.

Missy B

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #23 on: February 17, 2020, 04:33:44 PM »
Wow. I'm a landlord, and all this blows me away. I'd be perfectly happy to rent to someone whose finances enabled them to stop working.

Paul der Krake

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #24 on: February 20, 2020, 04:50:04 PM »
Most private landlords are accidental landlords who try their best to not get taken to the cleaners. That's all you need to know to understand why some gentle education is needed.

EndlessJourney

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #25 on: March 28, 2020, 10:29:17 AM »
Not to brag, but I just submitted a tenant application with no verifiable income stream.

The landlord did a search on our names, found our blog, spent the morning reading it and called to let us know he approved us. Pretty much based on the fact that we've accounted for and was able to explain our bizarre lifestyle quite thoroughly in print and pictures.

That was neat.

moneytaichi

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #26 on: March 28, 2020, 05:52:35 PM »
When we FIREd 2 years ago, we sold our house and leave the cash sitting in the bank. We also didn't have rental history for the previous 14 years. We just told the agent that we are in a fortunate place that we don't have to work. We showed our bank statement and had excellent credit scores, along with local references. They approved it right away. Since then, we moved and rented another place directly from the owner. No issues there. I'd agree with others that we are in a better financial place than many people because we don't depend on jobs. In short, you want to project a sense of confidence, not a sense of lacking. Hope it makes sense :-)

Reader

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #27 on: March 28, 2020, 07:17:50 PM »
do you want to consider renting out your home and using that income to rent other places?

BigMoneyJim

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #28 on: March 29, 2020, 04:38:48 PM »
(OP here) I did scout out some apartment complexes in late February and pretty much settled on one in particular.

I was psyching up to try to make the move in April, but the current pandemic erupted (in USA, anyway) about the time I was flying back. I was planning to try iBuyers or an investor for a quick sale to let someone else deal with the hassles of getting the house prettied up, but real estate in general is in a huge moment of uncertainty and iBuying in particular seems to have shut down hard.

In addition, dealing with people for home sale, moving, apartment acquisition, etc. is not social distancing.

Now I'm figuring on staying put at least another month and more likely 2-3 or more. Given that I'm retired and have a cash cushion, and that presumably contractors have less business, I'm considering getting the house fixed up myself. (Well, paying others to do it.)

I have a vague worry about whether apartment complexes may run into troubles during these times, but there's nothing I can do about it, so I have to just sit and wait and watch on that front. The complex I chose in particular has a building or two vacant right now as they're converting 3-bedroom units to two 1-bedroom units. They were to become available in April.

do you want to consider renting out your home and using that income to rent other places?

Not sure who that was aimed at, but I've repeatedly decided I don't want the bother of being a landlord. I keep getting tempted because my mortgage is much lower than rent would be, and my house is well-located for all sorts of working families in a more or less recession-proof area, but I just don't want the hassle, especially since I'm moving 2200 miles away.

I'd much rather have the equity (tax-free in my situation!) in my pocket investment accounts.

firebrand

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #29 on: March 30, 2020, 07:42:07 AM »
I sold my last home and rented a condo a couple years before retirement. The rental reference, and prior years tax statements made it easy enough to rent another condo in my new hometown. Anxious to relocate, I left my old hometown with two and a half paid months remaining in my lease. Thinking there wouldn't be any problem for the property management company to find new tenants I was looking forward to getting two months of paid rent in addition to my rental deposit returned to me. Out of curiosity I looked up the property last night to see what rate the property company was advertising and discovered the condo is not on the market for lease but instead being offered for sale. I'm no longer optimistic about getting two months rent returned to me. Oh well, win some, lose some.


EndlessJourney

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #30 on: March 30, 2020, 12:46:39 PM »
I was wondering what you guys were doing now that we are all suppose to be hunkering down at "home".

Yes, "home" becoming less of an abstract concept and more of a matter of passport/citizenry now that all the borders have closed. We've settled for the time being in Western Canada, seems to be much nicer than the east. We also just signed a 12-month lease - the longest stretch we've ever stayed in one place over the last 8 years.

But it's looking like it's more prudent to have a bunker instead of a room or AirBnB for the next little while.

Hope you are doing well down south.
Stay safe and healthy.
« Last Edit: March 30, 2020, 12:54:09 PM by EndlessJourney »

Linea_Norway

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #31 on: April 29, 2020, 09:13:38 AM »
We have just signed a rental contract for a house. There were two houses where we said to the owner that we were seriously considering it, the second time even that we wanted to rent it. In both cases, I showed our tax reports, just to show what we had on our accounts at the end of the tax year and that was a lot compared to what "normal" people have. And we showed the brochure of the house we just sold, with the clown price and the impressive view.
At the first house, the owner told us soon after that she very much wanted us as renters. Even though she had various others who were interested in viewing the house, she gave us a few days to decide.
At the second house, the owner still had an appointment with another couple to view after us, but told us the same day, she wanted to rent to us. She also appreciated that I showed the tax forms at my own initiative. After the viewing she googled us to see if nothing weird showed up. They both appreciated that we seemed quiet people with outdoor hobbies. In both cases they didn't want smokers and animals.
We obviously made a good and secure first impression on both. Our ages are 49 and 46, man and woman. We are foreigners who speak the language very well after 20 years.

BigMoneyJim

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #32 on: May 04, 2020, 07:19:33 PM »
Self-quoting:
I was psyching up to try to make the move in April, but the current pandemic [...]

Now I'm figuring on staying put at least another month and more likely 2-3 or more.

Hahahahahaha!

Ha ha ha.

Heh.

I have evolved my outlook and am now figuring on not moving for two years. (My own choice on how to deal with the pandemic, and I'm aware we don't all agree on that.)

So it looks like I'll be renting after having had two years of no income, so that could get interesting.

Also, in reimagining the next two years of my life it occurred to me I could pay off the house. I'm currently analyzing the ups and downs of that, but if I did it would mean in addition to 2 years of no income I'd have two years of no credit balances.

BigMoneyJim

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #33 on: August 22, 2020, 06:49:36 PM »
OP back again. I am once again considering moving, but for various reasons, the Seattle area is now "too far" during a pandemic. So my jam the past couple of days is to move from Dallas to Colorado as a compromise between the life I really wanted and the various personal & family safety factors affected by the pandemic.

I'm also now entertaining seriously the idea of becoming nomadic in the short term. This was suggested before, but I wasn't ok with that then.

So my new question: does a series of short-term rentals help build "rental history" for future long-term rental landlords?

Greenstache

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #34 on: August 22, 2020, 07:30:49 PM »
Depends on the criteria used by the landlord you eventually wish to rent from on a long-term basis.  References from short-term rental owners would probably be sufficient to demonstrate that you were able to keep the unit in good condition and pay rent on time, but might not speak to factors such as your reliability over a longer period of time (some landlords may care, and some will not).

As landlords, we are very careful to follow our set rental policies because we don't ever want to be accused of discrimination.  We would not have a problem renting to you, as long as you had good credit and could demonstrate ability to pay (proof of investments should do).  A number of people have pointed out that having relatively low passive income seems to have created a barrier for them.  Sounds like this may mean that the landlords evaluating their applications don't understand how a portfolio structured for growth rather than income functions, which is unfortunate.  If I were a prospective tenant in your shoes, I'd be prepared to do a little financial education - the keys being to show that they wouldn't be discriminating by renting to you (while turning down the applicant with no savings and no job), and to show how your portfolio has been set up to cover living expenses.  Good luck!

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #35 on: August 22, 2020, 09:42:57 PM »
I recently successfully rented a place, in similar shoes. Technically, I have a very part-time profession and business I could point to, but the income from that is very low, so I created a spreadsheet to show landlords that added up my various income sources, including my brokerage investments at a 2% yield. Between that, a high FICO score and my respectable, educated, friendly demeanor, it worked - I was offered 2 places, and took one. I wasn’t looking at corporate-type places however.

Joeko

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Re: Early retiree: Is it challenging to qualify to rent an apartment?
« Reply #36 on: August 24, 2020, 12:45:17 PM »
Just recently rented an apartment in the PNW with no income from a large management company.  They only needed a copy from a brokerage account or bank statement that demonstrated no issues with paying rent plus living expense for the term of the lease