House rent payments continued their downward trend in August. However, the industry's eyes are on September as states seek to bridge the gap between the CARES bill's expired unemployment benefit.
The number of households paying rent through August 27 was 92.1%, down from 93.3% in July and 94.2% in June, according to the National Multifamily Housing Council Rent Payment Tracker. The rate declined by 1.9 percentage points compared to the previous year from 94% in August 2019.
August marked the first month that unemployed Americans waived the additional $ 600 per week provided by the CARES Act of March 2020. President Trump has authorized states to pay out $ 300 a week from the Federal Emergency Management Agency and asked states to bring in another $ 100.
However, by August 31, only six states – Arizona, Louisiana, Missouri, Montana, Tennessee, and Texas – are said to have started providing this aid. Although more states are expected to go online soon, analytics firm RealPage Inc., one of the council's data providers, is already forecast that more households will miss payments in September.
NMHC President Doug Bibby said it was important for Congress and the administration to get back to the negotiating table and pass comprehensive laws to combat unemployment. "The industry remains encouraged by the degree to which residents have prioritized their housing obligations, but each day means more stress for individuals and families and a higher risk for the country's housing sector," Bibby said in prepared remarks. "If policymakers want to prevent a health and economic crisis from quickly turning into a real estate crisis, they should act quickly to provide financial assistance to tenants."
NMHC collects information from five technology companies on 11.4 million units of professionally managed homes across the country of varying sizes and rental rates.
According to RealPage, defaults were most common in cheaper Class C properties.
According to RealPage, payment rates were best among the country's largest metropolitan areas in Salt Lake City, Tampa, Providence, Sacramento, and Oakland. More than 97% of tenants in professionally managed properties paid their August rent at these locations.
The biggest year-over-year declines were in Las Vegas, Los Angeles, Milwaukee, and New Orleans, according to RealPage.