By Dave Schwab

SDUN Reporter

The news is good in the Uptown rental market as rates are down and are likely to remain there for some time to come, area rental agents project.

The outlook is even favorable for those unfortunates suddenly thrust into the rental market due to home foreclosures: Property managers are making allowances, and acting accordingly.

As for finding just the right rental property, the Internet has made it easy. Just go online to Craigslist, they advise, where a nearly inexhaustible selection of available inventory at all price points can be found.

Joan McAdam, a property manager with Golden Management, which handles properties countywide including Uptown, said home foreclosure these days isn’t a big handicap for rental applicants.

“We love those people, take them in a heartbeat,” she said. “In most cases it wasn’t really their fault – it’s happened to everybody. If they have a foreclosure on their credit, we don’t count that against them. We’ve found they make exceptional renters.”

McAdam said the biggest factors weighing on Golden’s decision to rent to a foreclosure client are solid employment and stable credit. “We don’t go by the credit score if they’ve lost their home,” she said.

For those landlords who do look at credit scores, significantly lower tallies have become more acceptable.

“We’re seeing a lot more people out there that have terrible credit – 500 to 550 FICO scores, which range from 400 to 850,” said property manager Tim Cassidy of Cassidy & Associates. “We’re seeing lower scores, dramatically, from a couple of years ago when the average was 675 or 700. With vacancies a little higher and it being a little more difficult to get tenants, market demands are requiring landlords to be a little bit more flexible. Most property managers are having secondary criteria for those people having difficulty with foreclosures, short sales, bankruptcy.”

FICO credit scores are calculated from a number of credit categories including payment history, amounts owed, length of credit history, new credit and types of credit used.

Cassidy said the recession is causing a change in population demographics, exerting downward pressure on rental prices.

“A lot of people are living communally, kids going back to live with their parents, parents going to live with their kids, sisters and brothers living in the same households,” he said. “Households are expanding. People have lost their jobs, their houses, so vacancy is a factor. It takes a little bit longer to find a home or rental.”

Two years ago, Cassidy explained, tenants could almost find their own replacements before moving on. “That’s just not the case now,” he said.

Sue Snowbarger of S&D Property Management agreed economic times are hard for tenants and that’s being “grasped” by landlords. Landlords are more willing now to give prospective renters who’ve fallen on hard times the benefit of the doubt, she said.

But Snowbarger does have one condition that she requires of all prospective tenants. “The first thing they have to do is be honest with me,” she said. “Tell me what happened. It’s not a new story. I understand. If they’ve lost their home but they still have the same income and they’re otherwise debt-free, I’ll rent to them.”

It’s a simple equation, she said: supply and demand. Rental prices are slipping back in these recessionary times because vacancies are rising, largely due to continuing high unemployment. It’s an inversely proportional relationship that landlords can’t ignore.

“It’s trickle down,” Snowbarger said. “People who’ve had jobs for years have lost them, or they’ve had their hours cut. We (property managers) can’t have an empty house just because we’re too stubborn to lower the rent.”

Landlords are making other concessions too.

“First and last month’s rent and moving costs – that’s pretty hard to come up with for a lot of people,” Snowbarger said. “So we’ll help with move-in costs. We’ll let them put half the deposit down, and they can pay the rest of the deposit over a three- or six-month period.”

Cassidy doesn’t expect rental rates in Uptown to change much anytime soon, but when they do, they will increase.

“As far as rentals go, we’re at the bottom,” he concluded. “I think it’s going to stabilize from here and slowly climb.”