COVID-19 alert: 93% of renters in professionally managed multifamily housing paid some or all of their rent, says NMHC

In its second survey of 11.5 million units of professionally managed apartment units across the country, the National Multifamily Housing Council (NMHC) found that 84% of apartment households made a full or partial rent payment by April 12, up 15 percentage points from April 5.

NMHC’s Rent Payment Tracker numbers also examined historical numbers and found that 90% of renters made full or partial payments from April 1-12, 2019, and 91% of renters in March 1-12, 2020. The latest tracker numbers reflect a payment rate of 93% compared to the same time last month. These data encompass a wide variety of market-rate rental properties, which can vary by size, type, and average rental price.  

“It appears that the vast majority of apartment residents who can pay their rent are doing so ... so apartment owners can help residents who legitimately need help,” said President Doug Bibby. “Unfortunately, unemployment levels are continuing to rise and delays have been reported in getting assistance to residents, which could affect May’s rent levels."

Bibby said that, as apartment residents begin receiving the direct payments and enhanced unemployment benefits from the federal government, "we will continue to see improvements in rent payments.” 

CLASS A PROPERTIES DOING BETTER ON RENT PAYMENTS THAN WORKFORCE HOUSING

“Anecdotally, we are hearing that different parts of the industry are experiencing different levels of rent payments,” said David Schwartz, NMHC Chair and CEO Chairman of Chicago-based Waterton. “As you would expect, more expensive Class A properties, whose resident base may be more able to work from home, are reporting much higher percentage of rent payments than operators of more affordable workforce properties whose residents are more likely to have had their incomes disrupted because of the pandemic.”

"History offers us no frame of reference for the truly unprecedented economic situation we find ourselves in,” said Bibby. "With apartment firms stepping up to support their residents by waiving late fees, creating flexible payment plans and offering other creative solutions for residents impacted by COVID-19, we expected more renters to pay later in the month than has historically been the case. The increase in this week’s number over last week’s, however, shows that apartment residents are continuing to pay rent despite the financial challenges facing them.” 

The NMHC Rent Payment Tracker metric provides insight into residents’ financial health over the course of each month, and, as the dataset ages, between months.  However, noteworthy technical issues may make historical comparisons imprecise. For example, factors such as varying days of the week on which data are collected; individual companies’ differing payment collection policies; shelter-in-place orders’ effects on residents’ ability to deliver payments in person or by mail; the closure of leasing offices, which may delay operators’ payment processing; and other factors can affect how and when rent data is processed and recorded. Total unit counts may change as units are leased or vacated and survey methodology is refined. 

HOW NMHC'S PAYMENT TRACKER WORKS

The NMHC Rent Payment Tracker is a cumulative data tool. Every week, the PMS providers submit two data points to NMHC: the percentage of apartment households that paid their rent for a specific time period and the total number of occupied units in their data universe (with certain exclusions). Data is submitted weekly on the following schedule: week one: from the first day of the month through COB on the 5th, week two: from the 1st through COB on the 12th , week three: from the 1st through COB on the 19th and finally from the 1st through the last day of the month, giving a monthly data point for the "percent who paid." To recap, the "percent who paid" number will increase each week, until we reach our final “percent who paid” number for the month.

Partial payments or conversions of security deposits into rent (which some property management firms are allowing) are captured once, when the first partial payment is accepted to avoid having them double counted.  Subsequent partial payments are not captured in the data because the metric is “what percent of renters paid some/all of their rent” in a given month.  Additional payments made by the same resident in the month would increase the total amount of rent paid, but this metric does not measure that.

The NMHC Rent Payment Tracker is powered by Entrata, MRI Software, RealPage, ResMan and Yardi. More information on the NMHC Rent Payment Tracker can be found here.  Additional NMHC resources, data, and materials can be found here.