You've undoubtedly heard of the plight of the nation's youngest congressman, 26-year-old Rep. Maxwell Frost of Florida, who was denied an apartment lease in Washington, D.C., due to his credit. Unfortunately, he isn't alone: Millions of would-be renters across the country can't get approved.
Even though rents have stabilized in some markets, and even dropped a bit in others, many tenants either don't make enough money to pay what landlords are asking or don't meet the credit qualifications.
Conventional wisdom says you shouldn't spend more than 30% of your income to put a roof over your head, including rent (or a mortgage payment) and utilities. Spending more than that classifies you as "housing cost-burdened." According to the National Low Income Housing Coalition, 47% of low-income renter households fall in that category.
Even in such a difficult market, there are ways to improve your chances of finding an apartment. One is to shop when the market is slow. Another is to get your credit in order.
The best time to move is in the winter, says David Bitton, co-founder of DoorLoop, a property management software company headquartered in Miami. Rental rates are lowest between October and April, he reports, with the best deals being offered in January and February.
"Fewer people move during this time of year," Bitton, a property manager himself, told me. "They're busy with the holidays, the weather isn't favorable and schools are still in session. As a result, property owners tend to reduce their rates, and moving companies and storage facilities run promotions."
If you're apartment-hunting right now, you missed that window, but there may still be some deals left. And if you have a longer-term outlook, there's plenty you can do to set yourself up for success next fall.
The first step is the same whether you want to rent or buy: Establish credit and use it wisely. Pay your bills on time and don't use more than 30% of your total available credit. These steps should help you earn a higher credit score, which Bitton says should be at least 650.
If you already have credit, check your record for errors. If you find any, work to have them corrected or removed. This could take several months, so be diligent and forceful; you must be your own advocate.
Next, start your search long before you plan to move, so that when the time comes, you'll know exactly what you want and where to find it.
To begin the process, research rental rates in your area of choice. Doing your homework now will tell you whether you are getting a good deal later. "Knowledge is power if you want to negotiate for the best prices," Bitton says.
Make sure you set a rental budget. You want to be able to live comfortably and enjoy your new place, so try not to exceed the 30% threshold mentioned above.
"Don't make the mistake of overestimating" what you can afford, Bitton says, adding that as a rule of thumb, your monthly income should be at least three times your rent.
A big part of what you'll pay will be determined by the amenities the building or community offers. Obviously, places with pools, workout facilities, covered parking and the like are going to be more expensive. But interior features such as walk-in closets, fancy appliances and hardwood floors will also cost more.
Realize, too, that many landlords these days charge for -- or pass along the costs of -- practically everything. So along with utilities, account for such recurring costs as trash pickup, cable and even pest control in your budget. Some places even charge an administrative fee just to process your rent payments.
When preparing to negotiate a lease, find out what the rents are in comparable properties. You'll strengthen your position considerably when you are armed with this information. Then, tell the landlord why you'll make a great tenant: You pay your bills on time, you have a good credit score and you are fully employed.
The landlord still might not budge on the rent. But if your negotiation is successful, Bitton says it's possible to knock a few hundred bucks off your annual rent -- or even thousands. It all depends on the local market, the property's condition and the landlord's willingness to bargain.
It's a good idea to set a target date for moving in as far in advance as possible. After all, you'll likely need a few days off from work for the move, plus time to arrange for a moving company (or enlist friends to help).
Start looking at places at least 60 days before you want to move, Bitton advises, adding: "I also recommend starting your search on the first weekend of the month. That's when fewer people are looking for apartments, and there's less competition."
When you show up at the rental office, come prepared. Bring your ID, bank statements or pay stubs showing your income, recommendations from previous landlords, credit card bills showing punctual payments and low (or no) balances -- anything that will put you in the best possible light.
Finally, while tattered jeans may be in fashion these days, leave them in your closet. A business suit isn't necessary, but do dress presentably.
"You must make an excellent first impression," Bitton says. "You want them to feel you'll be a reliable and responsible tenant."