Despite the economic downturn due to COVID-19, many Americans are still managing to pay rent. This could be due in part to stimulus money delivered this week.
In a nationwide survey released April 16, 2020, by the National Association of Residential Property Managers (NARPM®), it was found that most renters were current with their April rent payments. The survey was conducted among NARPM’s 6,500 members with 1,094 responses.
Over 40 percent of property managers reported that more than 90 percent of their tenants had paid April’s rent in full and on time. Another 20 percent said that 81-90 percent of their tenants were current with payments.
“It’s early yet, in terms of the wave of unemployment hitting the nation and its impact on rent and other financial obligations,” commented NARPM® President Kellie Tollifson, MPM®, RMP® of Bothell, WA. “Establishing this information from this point moving forward will give us a baseline from which to judge how the downturn will impact property management companies and the clients they serve in the coming months. We’ll be conducting similar studies monthly while the rental moratorium and the COVID-19 crisis remains.”
Property managers were also asked whether, if offered, renters had accepted a payment plan for April rent. Less than five percent indicated renters had accepted such a plan, while many commented that they had not yet felt the need to offer a payment plan.
Most (70 percent) of respondents said their company policy regarding maintenance requests had changed, with some indicating that ‘non-essential’ repairs would be held until local stay-at-home orders were lifted.
Over 78 percent of property managers indicated that they had instituted new policies for handling showings of rental units. Responses varied from self-showings only of vacant units using lockbox access to virtual (online) showings only, while some indicated stricter pre-showing screenings were now in place.
“There are many options today for prospective tenants to view a property,” added Tollifson. “Using technology, renters can do a virtual tour of a home to help them narrow their selections. Lockboxes are often used these days for self-showings, and most property managers offer a variety of technologies that will help keep renters safer whether during a crisis or otherwise.”
Stimulus Payments Help Rent Payments
Avail, the Chicago-based company offering an online platform of education and property management tools for DIY landlords has been studying the effects of COVID-19 on rent payments. The company’s data revealed a 300% increase in scheduled rent payments as of April 15, when compared to March. According to Avail, this was an abnormal increase in schedule payments that directly corresponds to renters paying rent with the stimulus money.
From Laurence Jankelow, Avail Co-Founder and COO:
“We’re closely monitoring trends in rental payments right now. We noticed on April 15 (the day many Americans first received stimulus money) that there was a massive spike in scheduled rent payments through the Avail platform. Comparing April 15 to March 15 showed a 300% increase month-over-month in rent payments. This data comes from about 20,000 rental charges processed by Avail on a monthly basis.
While this is great news for tenants and landlords, it also paints a gloomy picture going forward. If many are just now able to pay rent, what will they do in two weeks when rent is due again? Without being able to get back to work, tenants and landlords will need to find ways to work together to weather this storm unless they receive additional stimulus money.”
The company anticipates the percent of renters who partially pay and who pay late to increase.
Paid Rent in Full 77% 72%
Partially Paid Rent 1% 2.50%
Rent is Unpaid 21% 25%
Rent is Paid Late 47% 22%
Specifically, Avail’s data shows the number of renters who pay late will more than double before the end of April as they receive stimulus checks, tax refunds, or find other methods of paying rent.