Nearly a third of tenants in the United States didn’t pay rent in the first week of April, a landlord group stated.
The National Multifamily Housing Council (NMHC), whose research arm has launched a weekly accounting of rent payments, found a 12 percentage point drop in the share of apartment households that paid rent by April 5, the group stated in a release.
The stark figures were presented as “the first review of the effect of the COVID-19 outbreak on rent payments,” as American families struggle financially during the CCP (Chinese Communist Party) virus pandemic.
Only 69 percent of households paid their rent by April 5, down from 81 percent that paid by March 5, the NMHC found.
“Biggest takeaway: almost 70% of apartment households had paid their rent as of April 5. Those who can are still paying,” Caitlin Sugrue Walter, vice president of research at NMHC, wrote in a Twitter post.
“Will be even higher next week,” Walter added, referring to expectations that some people will likely pay rent at a later date.
“Because most apartment operators have a few days grace period where rents can be collected without penalty, clarity on performance data will be gradual for each month impacted by COVID-19,” she said in a note.
Also, because April 5 was a Sunday, the figures may not have captured rent paid online on that date, which would normally be processed on the next working day.
“The COVID-19 outbreak has resulted in significant health and financial challenges for apartment residents and multifamily owners, operators and employees in communities across the country,” Doug Bibby, NMHC president, wrote in an April 8 statement.
“However, it is important to note that a large number of residents met their obligations despite unparalleled circumstances, and we will see that figure increase over the coming weeks,” he added.
The group’s rent payment tracker is based on data from 13.4 million units nationwide. The council stated that in its calculations, it excludes vacant units, purpose-built student housing, privatized military housing, and subsidized affordable units.
While the percentage of payments is likely to see an uptick, as Bibby predicted, the 12 percent month-over-month drop suggests many renters are struggling to meet financial obligations as businesses shutter and people are asked to stay in their homes in a bid to curb the spread of the COVID-19 outbreak.
“This information is important because it will provide a regular look at how affected the nation’s 40 million apartment residents are by the economic crisis following the spread of COVID-19. It’s also an indicator of the industry’s financial performance, which has far-reaching financial and economic repercussions,” Walter said.
Bruce Brunner, a Minneapolis area landlord, told The New York Times that some two dozen of his 130 tenants told him they lost their jobs or had their hours cut.
“Six weeks ago, you could name your price and you’d have multiple people applying,” said Brunner, who owns and manages 20 duplexes and triplexes across the city. “Now, you’re deferring and working out payment plans, and it’s only going to get worse.”