This week, the National Multifamily Housing Council’s Rent Payment Tracker found that 86.2% of apartment households had made a full or partial rent payment by Sept. 13, based on a survey of 11.4 million units of professionally managed market-rate apartment units across the country.
This marks a 2.4-percentage point decrease from the share of households that paid rent through Sept. 13, 2019, a difference of 279,457 households, and compares with 86.9% of households that had made a full or partial rent payment by Aug. 13, 2020.
“While it remains clear that many apartment residents continue to prioritize their housing obligations and that apartment owners and operators remain committed to meeting them halfway with creative and nuanced approaches, the reality is that the second week of September figures shows ongoing deterioration of rent payment figures—representing hundreds of thousands of households who are increasingly at risk,” says Doug Bibby, NMHC president. “This sadly comes as little surprise given that Congress and the administration have failed to come back to the table and extend the critical protections that supported apartment residents and the nation’s consumer base during the initial months of the pandemic.”
Given last week’s Labor Day holiday, the NMHC and its data partners are examining whether this week’s data is more indicative of September’s overall collections. When asked about long-term collection trends during this week’s NMHC Rent Payment Tracker Webinar, Elizabeth Francisco, president of Res Man, notes that stimulus extensions at the state level may contribute to some stability in rent payments for the near future. Jeff Adler, vice president of Matrix, Yardi Systems, considers the current state of affairs a “slog as opposed to a cliff.” While some jobs are returning, and the unemployment rate currently stands at 8.5%, Adler cautions that employment types that depend on large gatherings will be much slower to recover.
In the U.S. Census Bureau’s recent Household Pulse Survey, 84.7% of renter households—across all rental types, not just professionally managed apartments—reported that they were caught up on their rent households, while 15.3% of households reported that they were not. Slightly more than one-quarter, 27.1%, had no or slight confidence that they would be able to make their rent payment for the next month.
When asked about one or more sources they had used to meet their spending needs over the past seven days, only 60% reported that they had been able to use a regular income source like they had used before the COVID-19 pandemic. One third, 31.8%, had used their stimulus payment, 20% had used unemployment insurance benefit payments, 29.8% had used credit cards or loans, and 30% had used money from savings or sold assets. Only 5.8% had used money saved from deferred or forgiven payments, and 13.6% had used SNAP benefits.
“Instead of being satisfied with a half-baked nationwide eviction moratorium, which does nothing to deal with renters’ real underlying problem—financial distress—lawmakers should instead look to the successful model of the CARES Act,” Bibby says, “and provide economic support to those who need it most—the tens of millions that call an apartment home, revitalizing the recovery at the same time.”
About Real Estate Intelligent Marketing (REIM):
REI Marketing is an innovative Real Estate Marketing Company that offers distinctive real estate services to developers and multifamily investors. We are a vibrant, dedicated team of industry professionals with international experience in marketing and multifamily investment.