A new national survey of multifamily residents predicts rent collection of 84.3 percent by June 10, up about 5 percent from the same time in May. J Turner Research found that 74.6 percent said they expected to pay rent on time with 9.6 percent responding it would be paid by the 10th. Another 6.0 percent said they expected to pay by the end of the month, bringing the expected total to 90.3 percent. Only 9.6 percent said they did not expect to make their rent payment for June.
In May, the research firm predicted rent collection early in the month would be about 80.8 percent, which came within a percentage point of actual rent receipt of 80.2 percent as of May 6, according to the National Multifamily Housing Council’s Rent Payment Tracker. By May 13, NMHC’s Rent Payment Tracker reported 87.7 percent of tenants had paid full or partial rent. NMHC pulls its data from 11.4 million professionally managed rental units.
“If our numbers are as on target as last month, rent receipts will be stronger than May, which bodes well for the industry,” said Joseph Batdorf, president of J Turner Research, which provides research and data to multifamily property owners and managers.
The firm’s June rent estimate survey was conducted from May 22 through May 31 and had more than 2,200 respondents, according to Batdorf.
Batdorf told Multi-Housing News the firm began the survey in April, the second month of the shutdowns across much of the U.S. due to the spread of the COVID-19 virus. He said the idea for the rent expectation survey came during discussions with property owners and managers.
“We thought if we could give them information about predictions for the upcoming month, that would be very useful,” Batdorf said.
For example, the percentage of respondents who said they would be able to pay their rent on time in June (74.7 percent) was up from 70 percent who anticipated paying their May rent on time. The number or residents who said they might be unable to make the June rent payment at all was 9.6 percent compared to 14 percent last month.
The research firm also asked respondents about their employment status, future personal expenses and opinions on re-opening the economy. Key findings included:
More than 9 percent reported they have been furloughed due to the COVID-19 crisis with an additional 5 percent indicating they were self-employed and saw their business revenues significantly impacted. Of those who said they were furloughed or laid off, 51 percent said they expected to pay the June rent on time. The survey found 21 percent of respondents were employed but working from home during the pandemic and 25 percent were employed and going to work.
Future Personal Expenses
The survey found rent payments were the priority for residents over car payments, utilities and even groceries. Forty-seven percent of those surveyed in late May said they were concerned about making the June rent payment. Asked about making their vehicle payments on time, 70.9 percent of respondents said they expected to make those payments on time compared to 13.7 percent who said they might not be able to make the June payments on their vehicles.
Opening Up the Economy
Researchers found a cautious outlook from respondents with 49 percent preferring to opening the economy in phases compared to 16 percent who said “open it immediately.” Nearly 35 percent answered “better to be safe than sorry” in May compared to 54 percent in April, indicating a bit more optimism than the previous month.