The National Multifamily Housing Council’s Rent Payment Tracker shows that 76.6% of households made a full or partial rent payment by Jan. 6, based on a survey of almost 11.3 million professionally managed multifamily units across the country.
This represents a 1.7 percentage point, or 192,613-household, decrease from the share of households who paid rent through Jan. 6, 2020, and compares with the 75.4% of households who paid rent by Dec. 6. By the end of December, 93.8% of renter households had made a full or partial rent payment—a lower share than in December 2019, but relatively unchanged from November 2020.
The NMHC notes that this data includes a variety of market-rate properties across the country, varying by size, type, and average rental price.
“While there is light at the end of the tunnel with the rollout of vaccines, the country and the multifamily industry continue to face steep challenges,” says Doug Bibby, NMHC president. “The recently passed COVID relief package included $25 billion in desperately needed rental assistance as well as expanded unemployment insurance. Now, it is critical that those funds reach those in need as quickly and efficiently as possible. … With the Biden-Harris administration soon to begin, NMHC looks forward to working with them and members of Congress on further support to help struggling households and keep the nation’s apartment sector stable. As we reach the beginning of the end of the pandemic, now is not the time to risk deepening the housing challenges facing the nation.”
As MRI industry principal Brian Zrimsek notes in this month’s Rent Payment Tracker Webinar, full or partial rent payment collections only rose above 95% once in the last six months of 2020. This was in July; since then, rent payment shares have “gradually eroded,” corresponding with the ongoing lack of stimulus funding.
Unemployment is rising again, with total nonfarm payroll employment falling by 140,000 in December. Greg Willett, chief economist at RealPage, notes that properties in expensive coastal markets are experiencing a larger share of missed payments than smaller or suburban markets—not only because stimulus funding goes further in cheaper markets, but because the Sunbelt and Midwest are regaining jobs more quickly.
The recent stimulus bill passage has not only provided $600 in individual aid, but $25 billion in rental assistance. However, the industry has accumulated an estimated $75 billion in deferred payment debt—or three times the amount of aid given in the bill, according to Yardi Matrix vice president Jeff Adler. There is also little indication of how this aid will be distributed.
The vaccine provides some optimism, though the rollout has not proceeded at the predicted pace—according to the CDC, only 5.9 million vaccinations have been administered. The panel’s experts expect a better notion of a “long-term timeline” within the next six weeks to three months.
When asked about the expected permanent changes to the industry as a result of the pandemic, Kevin Owens, executive vice president of operations at CF Real Estate Services, says he anticipates that virtual leasing and self-guided tours would not be going anywhere any time soon. While these services were available before the pandemic, many providers had not adopted them—something the pandemic’s circumstances have sped up. Amenities and space planning are also among the new considerations, with some plans to focus on “experiences as amenities” rather than physical locations.
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