According to the National Multifamily Housing Council’s third weekly Rent Payment Tracker report, 89% of market-rate multifamily households had made either a full or partial April rent payment by April 19, up 5 percentage points from April 12.
The April data reflects a 95% rent payment rate compared with March’s rate over the same 19-day period. Based on historic data, 93% of multifamily households had made their payments by March 19, 2020, and 93% had made their April 2019 payments by the 19th of that month.
“Despite these hardships and other disincentives, like eviction moratoriums, renters are doing what they can to continue to meet their rent obligations,” says NMHC president Doug Bibby. “… It’s unclear what’s going to happen going forward. How quickly the virus spread can be contained will determine how quickly business can reopen and people can get back to work.”
In this week’s update webinar, the NMHC Rent Payment Tracker’s property management data providers—Entrata, RealPage, MRI, ResMan and Yardi—were joined by Robert Hart, president and CEO of TruAmerica, and Lili Dunn, president of Bell Partners, for insight on their companies’ handling of the COVID-19 crisis.
Brian Zrimsek, industry principal at MRI Software, defines a normal payment rate as 93% and considers current rates only a “few points off” from that normal rate. Chase Harrington, president and chief operating officer of Entrata, has observed that many multifamily organizations are creating aid programs or flexible payment plans for residents who are experiencing difficulty with their payments. The analysts believe payment programs and deferrals may contribute to April’s positive numbers, as well as the disbursement of unemployment and stimulus checks.
Greg Willett, chief economist at RealPage, notes that some geographic areas are more challenging than others as far as rent collections, based both on the spread of the virus and the concentrations of job losses. He points to New York, Las Vegas, and New Orleans as three sore spots in this regard. Certain high-performing regions, including Salt Lake City, Sacramento, Calif., and Raleigh, N.C., are noted as centers of tech or government employment.
TruAmerica’s rent payment rate is “tracking close” to prior months, according to Hart, and has progressed from 60% near the start of the month to 93.1% as of April 19. The organization has worked closely with regional managers to work through resident issues and create payment plans and deferrals. Bell Partners is at just above 95% on its rent collections, and less than 10% of its residents have asked for payment plans. Dunn is “pleasantly surprised” by April’s numbers, but believes May will be “much more revealing,” especially as unemployment continues to rise and benefits are delayed.
The NMHC’s current congressional lobbying priorities include the establishment of emergency assistance funds for renters and property owners, as well as expansion of the SBA paycheck protection program to include multifamily firms.
“It is encouraging that apartment residents continue to meet their rent obligations whether that’s with the support of the federal relief funds, credit cards, and alternative, flexible options provided by the industry’s owners and operators,” Bibby says. “But their financial security is unclear as many may not qualify for federal relief, while others are drawing down savings and facing greater financial challenges, including higher health care costs. For that reason, lawmakers need to act now to enact a direct renter assistance program.”