According to the National Multifamily Housing Council’s Rent Payment Tracker, 80.4% of apartment households made a full or partial rent payment by March 6, based on a survey of 11.6 million professionally managed units.
This marks a 4.1 percentage point, or 474,942-household, drop from the share of apartment households who paid rent through March 6, 2020. Last month, 79.2% of households made a full or partial payment by February 6.
“On behalf of the multifamily industry, we are deeply appreciative of how leaders in Congress and the Biden administration worked with us to develop legislation that will deliver direct financial support to those facing distress due to the pandemic,” says Doug Bibby, NMHC president. “… We are especially pleased that the bill includes NMHC-supported provisions that will assist the nation’s apartment residents and housing providers—including rental assistance, direct stimulus checks, and expanded unemployment benefits. Taken together, along with the funds included in the stimulus package passed in late 2020, this represents a truly significant investment in the 40 million Americans who call an apartment home and the nation’s rental housing industry."
With the American Rescue Plan on its way through Congress, the Rent Payment Tracker’s data partners are optimistic about its impact on renters and the multifamily industry, based on upticks in collections performance following the past two stimulus packages.
In this month’s Rent Payment Tracker Webinar, BH Cos. president and CEO Joanna Zabriskie reports that a number of the company’s tenants had paid their rent forward following the CARES Act—something that had not been at all common among its renters before then.
BH Cos. continues to offer payment plans for renters in need and remains proactive in getting in touch with renters who have missed payments in order to educate them on payment programs. According to Zabriskie, of the renters that take on payment plans, 60% to 70% get paid current within a month.
Chase Harrington, chief operating officer at Entrata, notes that while some renters are electing not to pay rent despite the ability to do so, owing to eviction moratoriums, the number is very small. Greg Willett, chief economist at RealPage, adds that collections had been fastest to deteriorate on the West Coast, particularly in Seattle and Portland, and notes a risk of further drop-off as rental assistance fills in unpaid rent gaps.
In response to administrative issues related to rental assistance distribution, Yardi has created a software package to facilitate fund distribution, according to Jeff Adler, vice president of Yardi Matrix. “This is a heavy lift, and it’s not going quickly,” he says.
As far as overall collections, Adler notes that the Midwest has held strong, particularly in Columbus, Ohio, Indianapolis, and Detroit. The exceptions were downtown Chicago and downtown Minneapolis, though performance remained strong in these cities’ suburbs. According to Zabriskie, in the current environment, renters are looking for “what the properties are offering less than for location”—when renters don’t have to commute, a suburban community with larger spaces is more appealing than a Class A high-rise downtown. Concessions are still driving rentals in these asset classes, with some properties are “burying” concessions over the course of longer lease terms.
When asked how close the recovery is, industry experts say that while the suburbs are already doing well, the most expensive urban cores—particularly international gateway cities—still have a two- to three-year road back to recovery, with the greatest pain felt in the smallest properties. Workers returning to offices will be the most important factor in these cities’ performance, as well as the share of workers who ultimately choose to work from home full time.