A Denver start-up is trying to make the home rental market work better for both landlords and tenants.
PJ O’Neil co-founded Nomad after seeing the struggles that small landlords face when trying to cover the mortgage on vacant properties.
“I’ve been a landlord for a long time and it’s hard to make ends meet when you’ve got multiple properties that are vacant or you don’t have enough rent coming in,” O’Neil said.
O’Neil is trying to do for landlords what direct buying services like Zillow Offers and Opendoor did for home sellers.
With Nomad, property owners sign up for a one-, two-, or three-year contract, and Nomad guarantees rent every month for the duration of the contract. Nomad charges a fee to cover their own risk.
Unlike an individual landlord, O’Neil said Nomad can spread its risk over multiple properties. That can be helpful in an unpredictable market. During the pandemic, for example, demand for urban condos declined as renters sought more space in the suburbs.
“Single-family homes in our portfolio have been flying off the shelf and the condos are having a little more trouble,” O’Neil said.
Nomad also hopes to provide a smoother transition for tenants. Nomad renters can move between Nomad properties with no penalty for breaking a lease. O’Neil said the option is great for a growing population of “digital nomads” who may not need to stay in one place for work. But with guaranteed rent, Nomad provides stability for landlords.
“There are sometimes negative connotations with the word, nomad, but for us there are only positive connotations,” O’Neil said.