The spread of COVID-19 has had a limited economic impact, so far, on the ability of residents to make rent payments in public and affordable housing, according to a new report.
The report, by MRI Software, found payment rates for residents in public housing dropped 2% in May compared to May 2019. Rent payments were down 10% year-over-year during that same time for residents in affordable housing. That was still up 3% from pre-pandemic levels in February.
The report notes the limited impact on payments indicates housing continues to be a priority during the pandemic.
The report also found a significant decline in rental turnover as tenants look to stay in place compared to 2019 trends. Applications, new admissions certifications and move-out certifications were all down year-over-year by nearly 40% for public housing, and 30% to 40% for affordable housing. By comparison, the move-in rate dropped by nearly 21% for market-rate apartments.
"We expected to see a less positive picture in the affordable and public housing sectors than in the conventional sector given the seemingly more acute impact of the pandemic on this population, but the trends are surprisingly similar, said Brian Zrimsek, industry principal for MRI Software. "Like tenants of market-rate units, tenants of affordable and public housing units seem to be staying in place while also prioritizing rent over other expenses."
That could change, though, if Congress doesn't pass a new stimulus package or extend unemployment benefits.
"The labor market heavily influences the real estate market," Zrimsek said. "The real estate industry is facing uncharted waters as a result of the scale of the impact of COVID-19. To date, rental payments and occupancy rates have remained high due to enhanced unemployment benefits and eviction moratoriums. As businesses reopen and safety nets are removed, then we will see where the rocks really are."
The report did find a sustained drop in new work orders as the focus has shifted to emergency maintenance.
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Nate Robson
Nate Robson is the U.S. Supreme Court and regulatory editor. Contact him at [email protected]. On Twitter: @Nate_Robson1.
